MEFMI ATTENDS SEMINAR ON MANAGEMENT OF WAGE BILL

The International Monetary Fund Afritac South (AFS) organised a four (4) day seminar from 20-23 June 2015 in Ebene, Mauritius.  The objective of the seminar was for AFS countries to share practical experiences on approaches to wage bill management, and to explore potential options for institutional strengthening and improved monitoring and information systems as a means to address this pressing challenge.

The seminar was attended by Budget Directors, senior technical staff of Budget Departments, Macro-Fiscal Units and Public Service Agencies from AFS member countries. MEFMI was invited as part of the move to further strengthen the collaborative relationship with AFS, and was represented by Mr. Sayed Timuno – Programme Manager, Macroeconomic Management Programme.

Resource Persons at the Seminar were Ms. Teresa Curristine (IMF Fiscal Affairs Department); Mr. Franck Mordacq (IMF Short-Term Expert); Mr. Søren Langhoff; Ms. Anam Shahab (IMF Short-Term Expert) and Mr. Imran Aziz (AFS).  The MEFMI Programme Manager also gave a short presentation on wage bill challenges in the region.

The seminar content was drawn from empirical research that was undertaken by the IMF as part of a Board Paper on “Wage Bill Management”. The seminar used a mix of teaching methods and participant interaction modalities, including lectures, case studies, working sessions and plenary discussions.

During the seminar, countries were requested to share their experiences on managing the wage bill. Botswana and Madagascar presented on the key challenges in fiscal management of the wage bill for their respective countries. Lesotho gave a presentation on key challenges and experience in data management and system issues. Mozambique, South Africa and Zambia presented on the measures that have been undertaken in their respective countries to promote competitive compensation, efficiency and flexibility.

Zimbabwe presented on the key reform measures that could be adopted in the region to manage the wage bill, while the MEFMI Programme Manager was requested to give a regional perspective on key challenges in fiscal management of the wage bill.

The Programme Manager highlighted some of the challenges as including trade union pressures and reforms. In this regard, he pointed out that strong trade unions may typically demand more than what is budgeted for, and thus their pressures could result in the need for Governments to identify savings to fund the additional requirements. He explained that reforms typically could lead to increases in the wage bill. The Programme Manager went further and briefed the seminar on the requirements of a good reform Program. He pointed out that the requirements included discipline; accountability and transparency, all of which require political will. He proposed that in order to manage the wage bill, countries could consider harmonization of their various systems (e.g. payroll, human resources and the budget), instill controls and ensure availability of the required data for reforms.