Crisis-hit Sri Lanka finally strives to deal with bloated public sector
By: Staff Writer
Colombo (LNW): Sri Lanka is now undergoing unprecedented structural economic reforms with regard to revenue generation and cost cutting and pruning of bloated public sector workforce on the directions of President Wickremesinghe who rescued the country from possible economic collapse.
Undertaking economic reforms that would streamline the economy has been a long term desire on the part of the president and seen during his past stints as prime minister, official sources aid.
His radical measures have been widely criticized by the opposition political parties who created a ‘Goni billa’ ,a scary man for Sri Lankans compelling to oust the then Premier Wickremasinghe who suffered defeat at the elections that followed.
Typically, the reform measures he presents is based on the ‘trickle down’ theory which was miss interpreted by selfish politicians in highly corrupt politics like in Sri Lanka ,brainwashing minds of the who had to be satisfied with the scraps falling off the table, economic analysts said
Once again, he is taking up the challenge of implementing unpopular economic measures such as cutting subsidies, downsising public sector workforce, increasing taxes and privatising state owned enterprises. They added.
Sri Lanka is looking at ways to trim the public sector by allowing state workers to go on leave for other jobs both locally and abroad as a worsening economic crisis compels the island nation to reduce government expenditure.
Sri Lanka has more than 1.5 million public sector employees at present, the size having doubled over the past 15 years, according to official data. Efficiency in the public service is lower compared to that of Sri Lanka’s peers in Asia, despite there being a public servant for every 14 citizens.
At present the public service has shrinked by 135,000 to 1.393 million by the end of 2022 from 1.528 million in 2020 by removing some of them from service or allowing to vacate their posts or voluntary retirements.
According to the State Minister of Finance Ranjith Siyambalapitiya, the government has spent Rs 956 billion on State sector salaries, while Rs. 701 billion is estimated for salary payments in 2023.
As of 2023, the defence sector is estimated to claim nearly half (48%) of state salaries tri forces 32 percent ,health 17 percent and education 9 percent.
A special “conception paper” issued by the Manpower and Employment Ministry recently has suggested extensive public sector expenditure and job cuts claiming that that more than 50 percent of government income was being used to pay salaries and allowances to 1.7 million public sector employees at that time.
This warrants the government to cut more than 850,000 public employees to increase the productivity in the public service.
Other job curtailment and budget cutting plans, which will push a large numbers public sector workers and their dependents into poverty and starvation, are currently being discussed by the cabinet of ministers.