Managing public sector wage bill: Wages must match productivity - Fair Wages CEO

The public sector wage bill must be reformed to match productivity to performance of workers, the Chief Executive Officer of the Fair Wages and Salaries Commission (FWSC), Benjamin Arthur, has advocated.

Such a move, he said, would ensure that workers were adequately rewarded based on their productivity, which would be a form of motivation, while helping the country to efficiently manage the public sector wage bill.

Mr Arthur was speaking in an exclusive interview with the Daily Graphic.

While stating that the Single Spine Salary Structure (SSSS) had helped to manage discrepancies and disparities in public sector wages, he said, it was time for the country to focus more on the output of workers, instead of just the input.

National conversation

Mr Arthur disclosed that the FWSC, acting on a directive from the government, was already implementing an initiative to link salaries and wages in the public sector with performance and productivity to promote an efficient wage system.

That, he said, was besides the mandate of the commission to develop and implement salary and job performance structures in the public sector.

Mr Arthur said such efforts must develop into a national conversation and policy reforms proposals to manage the wage bill, with emphasis on how workers’ productivity contributed to national development and growth.

“We need to really get to know the productivity levels, so we index them to our national growth. In this regard, we will know that if we are not growing the economy by this much, or if inflation has not gone up to a certain level, then salary increment should not be above a certain threshold,” he said.

“For instance, a worker has been asked to push a table, and when he pushed the table, it never moved.

Now, if that worker is stronger than another worker, who was asked to push the same table, and the second worker pushed the table, who has really done the work? It is the one who pushed it, and he should be rewarded,” he added.

To achieve such a feat of linking pay to productivity and performance, Mr Arthur said, the productivity levels should be data-driven to indicate the contribution of workers in each sector to national development.

“It should not be the case that because we have the desire that we can pay only two cedis that is what must happen, or our demand is 70 per cent pay rise and that should be the case.

We have to index it to our national productivity in terms of our GDP (gross domestic product), and know how much or what percentage of our GDP should be for public sector workers,” Mr Arthur added.

The FWSC boss said the design of the SSSS was mainly premised on the commitment of workers, which was normally measured in inputs without any strong indexes on performance.

“A portion of the pay should be the input because sometimes some of the input might be genuine, and the output may be affected by the lack of logistics. But once we have done the job evaluation and placed you on pay, your continuous stay on it and advancement must be informed by performance.

“That is the next level that we need to achieve so that people do not just get hired into positions and just by the passage of time, they are promoted,” he said.

Huge wage bill  

Implementation of the SSSS began in 2010 with the purpose of streamlining all public sector wages, with the exception of Article 71 of the 1992 Constitution office holders, whose wages are set in line with the Constitution.

The SSSS was meant to remove disparities in wages by placing public sector workers on one vertical salary structure, and ensure that jobs within the same job-value range are paid for within the same pay range.

One of the objectives of the SSSS was to enable the government to efficiently manage the public sector wage bill.

However, while the policy has drastically reduced the disparities in public sector wages, it has — together with wages paid to Article 71 office holders such as the President, Members of Parliament and judges — ballooned the public sector wage bill over the years, making it more difficult for the government to free up resources for developmental projects.

Currently, it is estimated that the country spends around 28 per cent of the national budget on salaries and wages.

Competitiveness

Asked whether his suggestion would make it difficult for the public sector to hire the best talents and be competitive, Mr Arthur said it would rather enhance competitiveness.

He stressed that if public sector wages were based on performance and productivity, best talents would be encouraged to join as they would know that their efforts would be adequately rewarded.

“So there is a need for us to really dovetail pay with performance and productivity. Then, at the end of the day, we can say a worker is worth what we have paid him or her,” he explained.

That, Mr Arthur said, also had the potential of helping people to develop themselves and “to be able to say that when I put in more, I will get more”.

Writer’s email:emma.hawkson@graphic.com.gh