By: Staff Writer
August 26, 2022
Nigel Clarke, minister for finance and the public service in Jamaica, said public sector compensation is “too complicated” because there are just so many pay scales on top of the 185 allowances for roughly 110,000 civil servants.
Mr Clarke, speaking on a podcast, said: “We have 325 pay scales in a public sector and that means invariably, that we end up with iniquitous positions, because no one can manage 325 pay scales.”
He brought up a comparison with the United Kingdom, which Jamaica and all of the Commonwealth Caribbean countries inherited their legal system and bureaucratic system from and with a much larger population size and many more branches of government has only seven pay scales.
The reason why the pay scale problem is so huge in Jamaica is because there are multiple pay scales across different departments that perform the same job function, just with different titles.
Mr Clarke also said: “Another challenge is that we have a multiplicity of allowances. We have over 185 allowances across the public sector and this introduces a number of problems. One problem it introduces is that we have inequity across the system, because different persons in the public sector sometimes have a dramatic difference in the composition of their compensation.”
Allowances can represent up to 60 percent of compensation for some public sector workers whereas for others on the lower end it can represent as low as 20 percent.
The inequitable allowances system skews retirement packages because some people would be classified as a lower tiered civil servant, but with allowances can be bumped up to several times their actual net pay and end up retiring with a retirement accrual rate at the top tier.
With 110,000 public servants on the payroll, this can become problematic when it comes time for the ministry of finance to find monies to fulfil its pension liabilities. Luckily for Jamaica they have a contributory scheme which payment of pensions, gratuities and other allowances are to be paid in respect of the service of pensionable officers, and to provide for other related matters. This means that their pension system would not be at risk of imminent collapse due to the weight of their public pension system.
Mr Clarke noted, however: “We also want to make a best effort attempt to make compensation such that we can attract and retain the talent we need in a public service… To run a more modern bureaucracy, you need people with skills, you need people with talent, you need people to experience and the skills that you need today are very different.”
Mr Clarke did admit that there is a retinue of consultants tasked with finding solutions to this public sector boondoggle, but obviously there is no easy fix and his ministry just has to continue to chip away at the pay scales and put the allowances in line with their proper place over time.