GOVT BREACHES PROMOTIONS POLICY

MANZINI – Is government going against its own rule, that of freezing promotions?

Despite having suspended recruitment and promotions, the Ministry of Public Service is promoting civil servants to higher posts that are bloating the already high wage bill.

In recent months, the ministry has been promoting senior human resources officers to be principal human resources officers and other personnel within the civil service. 

By default, the promotions have created vacant posts which in turn demand recruitment of personnel into the civil service much against the hiring freeze imposed by the 10th Parliament. This publication has gathered that there are nine senior posts that have been made vacant by the promotions conducted by the Ministry of Public Service. 

The Principal Secretary in the Ministry of Public Service, Sipho Tsabedze, confirmed the promotions. He further acknowledged that there was a suspension of promotions; however, these in particular, were old.

Process 

“These are old and were not initiated after the cost-of-living adjustment (CoLA); but have been in the process for some time. They were actually approved by Cabinet a long time ago, in March,” Tsabedze said.

Having said that, the PS further noted that Circular No.3 of 2018 stated that critical positions would have to be filled through the approval of Cabinet.  Tsabedze said the promotions were necessary as stalling them would render the government machinery dysfunctional. He made an example of how a school would fail to operate if the head teacher had retired. 

However, when introducing the hiring freeze, through Circular No.3 of 2018, titled ‘Freezing of vacant posts and creation of new posts in all government ministries and departments’, principal secretaries (PSs) and heads of department were informed that Cabinet had directed that all vacant posts, including creation of new ones and promotions across government, be frozen.

Situation 

The Cabinet relayed this through retired PS in the Ministry of Public Service Evart Madlopha, who through the circular said: “This state of affairs has been necessitated by the current financial situation in the country and the cash-flow problems faced by government.”

Since the exit of the 10th Parliament, the incumbent Executive embraced this stance and has stood by it, stating that the wage bill was still bloated and needed to be dealt with through the hiring freeze. 

The circular informed PSs and heads of department that the Ministry of Public Service would not consider any requests from ministries or departments seeking approval for the filling of vacant posts whether through appointments or promotions. 

“All service commissions and other designated appointing authorities are therefore urged to heed this directive and ensure that no appointments and promotions are made against any vacant post,” read the circular.

Upon assuming office, the incumbent administration is said to have saved about E30 million following the suspension of new recruitments, replacements and promotions in the civil service.

Implement 

With the bloated wage bill in the country, this seemed to be a positive move as it sought to implement the reasoning of the Minister of Finance, Neal Rijkenberg – who in his maiden budget speech, said government had to shift from being the employer of choice by involving the private sector.

Yesterday, Rijkenberg informed this publication that government did not have money to fund the promotions. He said the same was the case for the recruitment of health personnel who were employed to bolster the sector following the crisis brought about by the coronavirus pandemic. “I cannot recall the promotions but what I know is government approved the recruitment of health personnel and about 20 other civil servants. However, if they were approved by Cabinet, then that is fine,” he said.

The minister further emphasised that government had a challenge in dealing with the wage bill and the hiring freeze was means to deal with it.

He said where circumstances called for the replacement of personnel in critical positions, government had to make a plan, not that money was there. 

Rijkenberg, when delivering his maiden budget speech, said in the last decade, the wage bill had grown by 125 per cent.

“In contrast, volatile SACU receipts have made government’s fiscal position untenable, in the medium term, SACU receipts are expected to decline due to South Africa’s worsening economic position,” the minister had said.

However, for a decade, government has failed to do one thing and one thing only, to reduce the wage bill. According to global lender, the International Monetary Fund (IMF), Eswatini ranked second highest spender on civil servants among the 53 captured countries. Currently, estimates of the wage bill are said to be E8.44 billion, which corresponds to 37 per cent of government’s expenditure. This figure, despite the advice of the IMF, has been escalating over the years. Since the 2010/11 fiscal crunch in the kingdom, the IMF gave pointers on what government had to do in order to deal with the bloated civil service’s salaries.

Instead, whatever means are implemented seem to have been countered by their execution and or flipping on them immediately there was an extra Lilangeni to spare. For the 2012/13 financial year budget, government, with the assistance of the African Development Bank (AfDB), developed a fiscal adjustment road map (FAR) which aimed at addressing both the fiscal and structural challenges. Through implementation of the FAR, government planned to reduce the civil service by 7 000 workers by 2015 and this was set to put the wage bill on a more sustainable path. However, according to the IMF, given the political sensitivities surrounding the civil service reform, the authorities adopted a more cautious approach, which sought to foster a buy-in from key stakeholders.

The retrenchments never took place as that would have thrusted upon government socio-economic challenges. However, during this period, government had to cut the wage bill by E300 million (1¼ per cent of GDP) on an annual basis, while protecting pro-poor spending, as a first step towards restoring fiscal sustainability.

Government, at the time, claimed to prefer a more gradual approach, based on reducing the civil service through an audit of the civil service roster, attrition, a reduction in the retirement age, and possibly a revised voluntary retirement scheme. In 2017, government released a report citing that there were no ghost employees contrary to reports and allegations made by those who were in the civil service.  

This was just a year after hefty increments were awarded to the civil servants, including politicians. 

The increments saw politicians, judges, and senior bureaucrats being awarded as high as 32 per cent. The salaries of low-paying occupations were increased by between 15 and 18 per cent. This was viewed to be imprudent in keeping the wage bill in check. But there is more to the compensation costs than meets the eye. 

Meanwhile, in 2017, the IMF reported that its directors underscored that steps to contain the public wage bill, prioritise capital outlays, reduce transfers to extra-budgetary entities, and boost tax revenues, would be critical to the adjustment effort.

The IMF encouraged government to improve budget formulation and expenditure controls, and strengthen the governance of extra-budgetary entities to ensure the credibility of consolidation plans. The IMF reported that for the 2016/17 financial year, the public wage costs for central government employees peaked to 13.8 per cent of the gross domestic product (GDP).

Revenue 

This was a 2.5 per cent growth from the 2012/13 financial year as it was 11.3 per cent of the GDP and it amounted to 99 per cent of domestic revenue (45 per cent of domestic primary spending).

While already on a rising path, in the 2016/17 financial year, the wage bill sharply increased as a review of public sector salaries reformed, among others, the pay structure and resulted in about two per cent of GDP in additional wage expenses.

It was then projected that the public wage-to - GDP ratio was expected, under current policies, to increase further and exceed 17–18 per cent of GDP (about 49 per cent of domestic primary spending) by 2021/22, largely above domestic revenue collection.

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