While trade unions remain in the dark about how many public sector workers have gone home, the International Monetary Fund (IMF) says Government indicated that, up to two weeks ago, 1,800 of the 3,000 had already gone on the breadline.
IMF’s mission chief to Barbados Nicole Laframboise said Government had recently updated the Fund on the retrenchment programme.
“We have been informed by the authorities that approximately 1,800 people were let go and, received formally, that notice by January 31, and that the remaining 1,200 would occur by March 31. A lot of these are coming from the public enterprises, not only from the central government,” she said during a conference call with journalists yesterday.
“They also expect, over five years to pursue attrition and they estimated another 500 for this calendar year, so that is a total of 3,500 which is about 10 per cent the size of the public service, which is not insignificant.”
Laframboise noted that the cash flow impact in the very near term is not likely to be felt from the next fiscal year since “there is a delay and a severance package which will affect the wage bill for this year.”
“So we are not expecting to see as much as we had originally hoped in this year, but [the layoffs] is an important element of the government’s current strategy,” she maintained.
However, in a separate interview economist Ryan Straughn told Barbados TODAY he was not impressed.
In fact, Straughn maintained that the retrenchment was perhaps a little too late. He said the private sector was now struggling and confidence in the government and local economy had already waned.
“Even though at this late stage the Government has seemingly identified what needs to be done and acknowledged the problem you really can’t take them at their word because they have not, up until now, done anything, and even though they have belatedly started to address a part of the problem by the latest retrenchment I think it is at a stage where, like I said, at the end of December the current account deficit was $500 million so the few people you sent home now pale in comparison with that figure,” said Straughn.