Vice President Bharrat Jagdeo believes the eight per cent pay increase to public sector workers is sufficient.
Attempting to justify the much ridiculed pay increase, the VP said contrary to the belief of many that the government has received a lot of money from oil and gas, the sum is “modest that will grow to fairly large sums in future years.” The comments were made at a State House event Friday evening.
Guyana is ranked the world’s fastest growing economy. This year Guyana will haul in US $1.1 Billion in oil and gas revenue. This is revenue never before seen.
Further, according to the VP, the pay out is enough because Guyana still has a large fiscal deficit and the People’s Progressive Party/Civic (PPP) government has reversed some of the tax measures implemented by the A Partnership of National Unity and Alliance For Change (APNU+AFC) government.
A commentator told Village Voice the government is not concerned about managing debt evident by its spending to satisfy a certain section of society, even if at the detriment of the masses. “Fiscal deficit and removal of tax measures become the convenient smokescreen not to pay public servants a decent wage.”
The commentator further said the government ignores fiscal deficit when it comes to injecting billions of dollars into the beleaguered Guyana Sugar Corporation (GuySuCo).
It is also Jagdeo’s view were the APNU+AFC tax measures not reversed Guyana would have been harder hit with the high cost of living relative to other countries.
The International Monetary Fund (IMF) forecast global inflation would rise to 8.8 per cent in 2022. Per the IMF elibrary ‘Outlook and Risks’ for Guyana “[i]nflation is expected to rise to 9.4 percent at year-end 2022 and decline thereafter.”
Last September, Minister Ashni Singh, who has responsibility for Finance, projected inflation at 5.8 per cent for 2022. Singh also reported the economy defied shock to record an overall real Gross Domestic Product (GDP) growth of 36.4 per cent in the first half of the year, with the non-oil economy growing by 8.3 per cent.
In the same month, an IMF report stated the “overall real GDP growth rate is projected to be 57.8 per cent in 2022.”
The cost of living in Guyana is exceedingly high for the average person. People are spending more for less. A pound of sugar, in one year, moved from $80.00 to $240.00; a 20-pound cylinder of cooking gas from $3200.00 to $5,000; a pound of milk increased from $400.00 to $800.00; a 10kg bag of rice from $1500.00 to $2500.00. Cost of living has eaten into wages/salary. On average, prices for essential items have increased about 90 per cent.
An October World Bank Report on Guyana stated whilst the economy is expanding at an extraordinary rate, poverty is increasing. According to the Bank, 48 per cent of the population, per head count, is living below US$5.5 a day which ranks Guyana among the highest in poverty in the Latin America and Caribbean region.
The APNU+AFC president and minister received a one-off increase in 2015 and none thereafter, even as yearly increases were paid to public sector workers, President Ali and his ministers made no adjustment on their pay. In 2015 when salaries were increased for coalition ministers, Jagdeo not only condemned the increase but said the PPP will revert the pay when they get into government. They did not. Further, President Irfaan Ali and his ministers have paid themselves the seven per cent in 2021 and eight per cent in 2022. Their salaries are non-taxable. The ordinary public sector workers’ retroactive pay increase and wages/salaries are taxable.
