Gov’t to outline position on public sector wage increase

[Dr.Dudd]

Gov’t to outline position on public sector wage increase
Thursday, 13 August 2009
The Government is moving decisively to quash any lingering misconceptions regarding its inability to pay the 7% increase due to other groups of public sector workers.

RJR News understands that the Finance Ministry will on Friday issue letters to trade union heads outlining in detail its final position on the issue of the public sector wage freeze.

It is expected that the Ministry will state in clear terms that it is not in a position to increase the wage bill due to severe financial constraints.

Our news centre understands that members of the Public Sector Memorandum of Understanding were informed of the Finance Ministry's intent when they met on Tuesday.

The Government has insisted that it cannot pay improved salaries at this time due to the sharp fall off in revenue and the need to reduce the fiscal deficit.

Up to the end of June, inflows into the Government's coffers were nearly $8 billion below projection.


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[Dr.Dudd]

Re: Gov’t to outline position on public sector wage increase

this is the part of economics that the fools who are promoting the shrinkage of the economy does not understand. The elasticity of government revenue. If the largest employer cuts back the whole economy will be cut back as much as 7 times the cut made by what was cut. It is called the multiplier effect. That is what the economic charlatans don't understand. you cant' cut your way out of an economic blight. Running a country is very different from running a business. countries have fixed expenses that is inelastic where you cannot cut it and not lose up to 10 times that which you thought you would have gained. they increase taxes rates beyond the market capacity, and tax volume suffers by a greater percentage than existed. where are the ones that are supposed to be informed about this? yes I know they are not listened to. the puppeteers are only willing to listen to yes mean and women..

[Amberal37]

Re: Gov’t to outline position on public sector wage increase

The government being the biggest employer, by them not increasing salaries by their previously proposed 7%, then will be evident to the retailers out there that they can't push up their prices and expect those workers to be able to afford to pay.

Conversely, also if the governmen HAD proceeded with the planned increase - those dealing with teachers, nurses, policemen, etc. (as customers), would catch on that these folks CAN afford to pay more - therefore might lead into their psychy to increase cost of products to these groups, which invariably will feed into inflation.

I will stretch it a little and say - let us hope instead that these retails are squeezed to reduce their prices - plenty of them have been milking it for years! (wishful thinking on my part I think)