By Ernie Seon
Dr Kenny Anthony, Prime Minister of St. Lucia
The St Lucia government seemed headed for a confrontation with public service unions after they rejected its proposals Friday and Prime Minister Dr. Kenny Anthony immediately signaled that all options, including the retrenchment of public servants, were now major possibilities.
The government’s six point proposal included a five percent wage cut for all public servants in Grades 4 to 21 in addition to a wage freeze for the next triennium.
But speaking to reporters at the end of the talks on Friday, a disappointed Anthony said that in light of the total rejection, his administration will now have to go back to the drawing board and put all options on the table.
Prime Minister Anthony has previously ruled out retrenchment as the way of reducing the EC$76 million (one EC dollar = US$0.37 cents) deficit, saying it was not his intention to send any public servants home. But he observed that with the rejection of the proposal, government had no choice but to consider all options.
“Going back to the drawing board means that all things are on the table, for example we have been talking about reduction in wages, retrenchment, additional taxes, all of those things will have to come back on board,” he noted.
Anthony, who is also Finance Minister, also indicated reluctantly the possibility of introducing Value Added Tax (VAT) on water and electricity, but admitted that the measure was a last resort as it would have significant implications for the poor and would deal a death blow to certain sectors.
Anthony who has been asked by the main opposition United Workers Party (UWP) to resign over his “mismanagement of the economy” maintains that the entire region is facing very challenging times, and difficult decisions are the sad reality facing many governments of the region.
“We have had a number of countries that have gone through IMF (International Monetary Fund) adjustments, we started off with Dominica, then it extended to Antigua, then on to St Kitts, now Grenada is about to enter into an agreement with the IMF, and of course we are trying to deal with our own problems, by making the appropriate adjustments,” he said.
Three of the unions, including the Civil Service Association (CSA), the Fire Service Association, and the Police Welfare Association did not attend Friday’s talks, while those that did – the Nurses Association, the Teachers Union and the National Workers Union – did not entertain any cut in wages, or a wage freeze outside of the established parameters.
CSA president Mary Issac had earlier indicated that workers had lost confidence and trust in Prime Minister Anthony, following his unilateral decision to legislate a five percent wage cut even before holding talks with the affected associations.
“So to call us to the table only to tell us what you have already done, without consultation, doesn’t give us any reason to believe, you will act in the interest of public servants, even after possibly agreeing to do so,” she said.
In making his case for a wage cut and a wage freeze, Prime Minister Anthony said that wages and salaries account for 48 percent of recurrent expenditure and government could not afford to continue to borrow to meet that commitment.
He said salaries and wages represent 13 percent of gross domestic product (GDP) and that’s well above the Eastern Caribbean Central Bank’s (ECCB) prudential target of nine to 10 per cent of GDP.
He said this issue could no longer be ignored and any successful attempts to reduce recurrent expenditure must target the wage bill.
“Our government has repeatedly made a point that we want to preserve employment. Therefore, we do not want to go the route of Barbados with the retrenchment of public servants.
“We do not want to send any public officers home. However, to do that, to keep the current level of employment in the Public Service, some sacrifices must be endured by all public officers.
“The government’s preferred approach is dialogue, discussion and consensus. However, should it be impossible to arrive at consensus then the Government will have to act in the best interest of the country,” Anthony said.
