Government to freeze hiring of workers

by Linda Straker

• Freeze on hiring of new workers to Public Service
• Recovery Plan will be tabled for Parliamentary approval next week
• Over 20 Statutory bodies expected to aggressively contain unnecessary spending

Government’s Recovery Plan to return the country to pre Covid-19 economic growth and development includes a freeze on the hiring of workers, continued implementation of the attrition policy and rationalising subventions to statutory bodies.

“Measures to restrict growth in discretionary recurrent expenditure and improve the strategic prioritisation of capital expenditure. The Government will put a freeze on the hiring of new workers to the Public Service and continue the implementation of the attrition policy,” said the Recovery Plan which will be tabled for Parliamentary approval next week.

Section 10 (4) and (5) of the FRL states, “Where the Minister has suspended any fiscal rule, target or corrective measure established under section 7 or 8, the Minister shall immediately prepare and lay before the Houses of Parliament for approval, a recovery plan memorandum.

The recovery plan memorandum according to the subsection of the legislation shall set out the measures proposed to secure compliance with the fiscal rule, target or corrective measure at the expiration of the period for which Parliament approves the suspension of a fiscal rule, target or corrective measure established under section 7 or 8, including the size and nature of the revenue and expenditure measures.”

The recovery plan states there will be no new taxes or increases, but a number of measures will be adopted to reduce expenditure and at the same time increase revenue.

“Expenditure on discretionary Goods & Services will be curbed to limit the ratio to GDP to less than 3.5% by 2023. Current Transfers are another area where strict expenditure controls will be implemented,” said the plan which was mandatory because of the Government’s decision to suspend sections of the Fiscal Responsibility Act in 2020 after a state of emergency was declared and the acknowledgement that the fiscal position will contract because of Covid-19 control measures.

“Grants and subventions to Statutory Bodies and other organisations will be rationalised. It is assumed that Covid-19- related transfers will decline over the medium term as negative socioeconomic effects of the pandemic subside.” The plan is scheduled to be debated during the 2 March 2021 sitting of the Lower House of Parliament.

The more than 20 Statutory Bodies which include the Spicemas Corporation, Child Protection Authority, Grenada Tourism Authority and the Grenada Airports Authority are expected to aggressively contain unnecessary spending.

“Recurrent primary expenditure is projected to decline from $552.5 million in 2021 to $483.4 million in 2023.” The plan will be debated in the Senate or Upper House after receiving approval from the Lower House.