That other contract scandal

Ram & McRae in their Focus on the 2010 Budget drew attention to a section of their 2009 Budget Focus which examined the explosion of the number of ministries between 1992 and then. In addition to including a table and commentary listing the ministries, the firm noted that a number of ministries, including the Ministry of Finance, have two ministers and some even have parliamentary secretaries as well. It pointed out that masking these numbers was a vast battery of consultants, contract employees and advisors, particularly in the Office of the President, where several former ministers are guaranteed a position, often more sinecure than substantive, and apparently indefinitely. In the Ministry of Local Government, there are two former ministers who are now employed as consultants, reportedly on the same terms and conditions they enjoyed as ministers.

Hard hearing, poor sight
The firm opined that given the country’s economic conditions and needs, the compensation paid to these persons, all of them on contract, and therefore outside the terms, conditions and low salaries of the public service, placed too great a burden on the taxpayers. It called for a major reorganisation and rethink of the public sector. As expected, the recommendation fell on deaf ears. In fact, the situation has gone well beyond poor management and now seems reckless, even as the donor community and the multilateral financial agencies turn a blind eye as they hand over additional billions into the bottomless treasury.

Yet, the Ministry of Finance, which has moved from 20 contract employees in 2008 to 80 in 2010, a 300% increase, seems unwilling and/or unable to engage in even the most elementary analysis of the billions which the Minister Dr Ashni Singh, loves to rattle off in his Budget speech. If the ministry would even do a cursory examination, it would realise from publicly available data on employment cost and revenue expenditure, that employment cost as a percentage of expenditure rose from 13% in 1992 to 32% in 2009. It would have realised too, that except for the significant increases awarded by the Armstrong Arbitration Tribunal at the end of the nineties, the increases have largely been as a result of a substantial spike in the number of contract employees across the central government, and the huge sums some of these people are paid.

As a result of this 300 % increase in the Finance Ministry, the wages and salaries for contract employees moved from $33 million in 2008 to a budget of $92 million in 2010 under Programme 31, Ministry Administration! The Minister is, regrettably to me, truly following in the footsteps of the President, both as a technician and a politician.

Whereas in 2004, the percentage which the wages and salaries of contracted employees bore to the total wages and salaries of all employees was 8.9%, that percentage is budgeted to jump to 21.5%, with 5% of this coming in 2010 alone.

Wages and salaries costs for contract employees will rise in 2010 by 36.7% over 2009. By contrast, the wages and salaries for 21,154 persons in all the other categories of public servants – teachers, nurses, police, soldiers, clerks, etc. – rises by a mere 4.8%. That does not seem equitable or just, but the unions representing the public workers have been emasculated – either by their leaders or the employers. Of course, not every contract employee gets seven figure packages and the perks that go with them. Like the Orwellian Animal Farm, and our own private sector, some contract employees are more equal than others.

The bigger culprits
The table below showed the employment information in some of the principal agencies at the end of 2009 and 2010.

Source: Public Sector 2010 Estimates

Can’t beat OP
The Ministry of Finance is fast catching up on the worst offender, the Office of the President, where the number of contracted employees for 2010 has increased from 82 in 2008, 85 in 2009 to 106 in 2010. But while the increase in 2009 may appear insignificant, the cost is not. Line item 6116 under Programme 11 Administrative Services shows that of an approved wages and salaries budget of $21 million for 2009, actual spending was $42 million, a 100% increase. Dr Singh should explain what constituted the increase and the source of the financing, and whether this was financed from any of the Minister’s supplementaries. Programme 12, Presidential Advisory, which cannot even house the number of advisors and contract employees the President surrounds himself with, will increase that number by another 17 in 2010, at an additional cost of fifty million dollars.

Programme 12 includes former members of the government whose performance as ministers was, at best, mediocre; party apparatchiks and their relatives; those who use public resources to engage in personal and private business or run sports events, or who cannot find an office and work from their homes, or who seem unable to understand their functions and duties.

We have in the Office of the President an Advisor on Governance, but bills passed by the National Assembly lapse for want of presidential assent. Ironically, the holder of that post, Ms Gail Teixeira is also a key member of the Parliamentary Management Committee that should oversee the business of the National Assembly and the effecting of the laws passed.

But the Ministry of Health, whose senior minister has his own views on the need to comply with laws and systems of procurement and indeed most other things, must surely warrant attention with the number of contract employees fast approaching one thousand, even as the exodus of nurses continues unabated. Agriculture is not half as bad but the annual increase in this ministry and the education ministry needs to be watched, particularly in some of their programmes.

Sporting exit
In the Ministry of Culture Youth and Sport, all thirteen of the employees in Sports, are contract employees. The Department of Sport has not been constituted for more than two years and its audits are several years in arrears. Yet, the National Assembly will soon be giving it another hundred million dollars. I sincerely hope that the ministry will address and arrest this situation, sooner rather than later.

The Public Service Ministry also has a significant number of contract employees. This ministry is responsible for ensuring that the public service is properly organised and has a pool of persons on the fixed establishment to ensure that institutional memory survives any personnel changes. This practice, of which the Office of the President is at the centre, effectively subverts Article 201 of the Constitution that envisages the role of the Public Service Commission as being principally responsible for the employment of public officers.

A more recent convert to the syndrome are the regions, and it is perhaps not without significance that Region Six, the cradle of the ruling party, has both the highest number of employees among the regions and is doubling its number of contract employees in 2010. But so too are Regions 3, Essequibo Islands/West Demerara; Region 2: Pomeroon/Supernaam; and Region 5: Mahaica Berbice. In a year of regional elections and one year before the national elections, such a situation has to be viewed with skepticism and concern. This copying of a bad practice was called by ol’ people: “monkey see, monkey do.”

I called the Public Service Commission for an input on this issue but when the Chairman, Mr Ganga Persaud realised I was on the phone, he had suddenly “stepped out,” prompting me to ask his secretary whether he had a secret exit.

This other ‘contract’ phenomenon allows the ministers and the politicians, many of whom with no business experience or expertise have the freedom to create as many job positions as they wish, unhindered by any strictures of the Public Service Commission, or any principles of proper human resource administration. Contract employees are not eligible to join the Public Service Union but receive a generous gratuity every six months. The more senior contract employees enjoy generous tax and duty concessions, even as they also benefit from state-owned vehicles, chauffeurs and other staff that mask the true value of the cost of such employees.

Hopefully, the National Assembly will seek some sensible answers to this rapidly developing abuse that has effectively made the public service, once again, subject to party paramountcy.

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