Finance Minister, Dr. Peter Phillips, says the government does not intend to undertake a major job cutting exercise in the public sector next year.
Last week the IMF said that given the new public sector wage agreement, the Government will face “undesirable options” of more taxation or a reduction in the size of the public sector, in order to meet its target of bringing the wage to GDP ratio, down to 9-percent.
Opposition Leader Andrew Holness and his spokesman on Finance, Audley Shaw, have described the IMF’s warning as ominous.
On page nine of its 80-page country report on Jamaica, the IMF said its staff and the Jamaican authorities have agreed to accelerate efforts to constrain the size and remuneration of the public service.
In Parliament today, Opposition Spokesman on Finance, Audley Shaw, asked Dr. Phillips to address concerns that job cuts are coming next year.
The IMF has noted that the wage bill for the current financial year is projected to reach 10-point-1 percent of GDP, exceeding the agreed target of 9-percent.
Dr. Phillips told the House of Representatives today that options are now being contemplated to contain the wage bill.
Dr. Phillips also told parliament that in light of the 7-percent wage increase being given to public sector workers, adjustments will have to be made to the budget for the current fiscal year.