CALL TO INCREASE COLA JUSTIFIABLE

MBABANE – The call by civil servants to increase the Cost-of-Living Adjustment (CoLA) above three percent threshold ceiling by the Government of Eswatini could be justifiable in the spectrum of high cost of living.

This was mentioned by Southern African Research Foundation for Economic Development (SARFED) regional coordinator and Economist Dr George Choongwa in a statement issued yesterday. Dr Choongwa stated that the high cost of living was induced by both indo and exogenous factors the economy of Eswatini has been subjected in the past decade. The economist said, however, the deadlock between two bodies in reaching a strategic conscious within an ideal time frame could have a double-sided ripple effect causing fiscal disparities at the expense of the entire socioeconomic spectrum of the country, as the economy would slide into a stagflation mode. He said in spite of the fact that Eswatini public sector has had a record of having a largest wage bill in the sub-Sahara Africa for the past two decades, government has had achieved to reduce it to considerable levels.

Bill

He noted that according to the Ministry of Public Service Annual Performance Report for the financial year 2021/22, government’s wage bill decreased to considerable levels by E47.4 million in a space of three months, causing a boast in the country’s fiscal space. Dr Choongwa said, however, austerity measures were taken at the expense of high unemployment rate as hiring free was introduced as well as other re-current public sector performance activities caused by reduction in the Government Computer Services (GCS). He said amid the increase in the cost of living, the country’s income per capita has been sluggish with a growth rate of about 1.8 per cent per year on average since 2012. Dr Choongwa added that the reactive increase in disposable income as a measure to curb inflationary effect on aggregate spending by the civil servants as demanded by the trade union through the CoLA would not have a sustainable effect on economic stability and growth unless government and the trade unions establish smart partnership pathways that would bring about collective benefits using a transitory economic growth modalities for both monetary and fiscal policy stability as measures to avoid stagflation.

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