BOSS move

The island’s largest public sector union has backed the Barbados Optional Savings Scheme (BOSS).

President of the National Union of Public Workers (NUPW) Akanni McDowall reported today that 500 members voted “yes” to the plan at a two-and-half-hour general meeting via Zoom last night.

He explained that while the entire membership is between 8,000 and 9,000, the NUPW’s constitution requires only 50 people at a general meeting to make a decision that is representative of the entire body.

“We had an overwhelming majority of the members supporting the BOSS plan that was presented to us by the Government,” McDowell told Barbados TODAY.

“So, at this point we can say that the union is supportive of the BOSS proposal, recognizing that public servants can make an individual decision.”

He also disclosed that the union had now met with all of its internal committees – the executive committee, national council, shop stewards and, finally, the general membership – to get approval at all levels for the scheme that allows public workers to take a portion of their salaries in four-year bonds at a five per cent interest rate.

With the green light given for the BOSS, McDowall said the NUPW will continue its discussions with Government at the level of the Social Partnership, on implementation of the plan.

The main tenet of the proposal is to redirect funds now earmarked for public expenditure on wages and salaries to generate as much economic activity as possible within the country by shifting them to capital expenditure.

This would allow the Government to finance an expansion of its capital works programme to create more jobs and complete urgent construction works without further impacting the fiscal targets, and to put as many people back to work as possible, thereby easing the burden on the Government’s responsibility to finance unemployment benefits claims.

Government has likened the BOSS to a “meeting turn”, except that an individual earns an attractive rate of interest on the money saved every six months and then gets back those savings after four years.

It is therefore designed to provide an opportunity for public servants to optimize on the savings/investment opportunity, given the current market conditions for interest rates whilst allowing the Government to temporarily shift a portion of its wage bill to capital expenditure.

The idea is to pay workers a portion of their salary in cash (the majority) and the remainder (about ten per cent on average) in a bond. By doing so, only the portion paid in cash is recorded as an item of expenditure on the Government’s books but not the portion paid as a bond – which is recorded as debt.

The worker still gets his/her full salary but a portion of the salary is paid in a bond, which can be easily and seamlessly converted into cash if needed, once the public officer exercises that option.

To compensate the worker for freeing up a significant amount of cash that the Government will then use to finance its critical capital works projects, the Mia Mottley administration is offering an interest rate on the bonds of five per cent. emmanueljoseph@barbadostoday.bb