Time to cut Government jobs?

Government might have to take the axe to its own workforce in a bid to rein in spiralling national debt.

Around 1,000 new jobs have been added in the civil service since 2005 —one of the main reasons for big rise in Government spending over that period.

PLP leadership hopeful Terry Lister acknowledged that current staffing levels — which tipped the 6,000 mark in 2009 — were not sustainable.

But he says cuts can be made without redundancies by offering generous early retirement packages and phasing out some positions.

“We are still at the point where we can make this work without the need to do anything drastic,” he said.

But Mr. Lister accepted that something would have to be done to cut Government’s wage bill — which makes up more than half of its billion-dollar budget.

Economist Bob Stewart — a vocal critic of the PLP Government — said current civil service staffing levels were “absurd”.

He said adding Government jobs was a vote-winning tactic that hadn’t enhanced efficiency or improved service.

And he insisted a large number of the posts were for “doing nothing” and could be cut without anyone noticing.

 “Say for example you have a $50,000-a-year job counting the fish that go under the bridge at Flatts Village. I couldn’t say you are unemployed but if you are not doing anything of particular use then it’s effectively welfare. It is just a disguised handout.”

Government staff levels have risen steadily since 2005 — when 4,860 people were employed.

Latest figures show 6,006 people were working for Government in 2008/2009 though this is projected to decrease slightly to 5,858 by 2011.

Craig Simmons, an economist at Bermuda College, believes further inroads will have to be made as Government trims its budget to satisfy creditors.

“Cuts in spending will invariably involve a reduction in the size of the civil service: salaries make up over 50 per cent of current spending. 

“Because debt has increased so dramatically of late, the new government will not have much wriggle room. The ability to borrow and tax has been comprised. That leaves cuts in spending as the only medium term option.”

No one from Government was prepared to comment. Paula Cox, the current favourite to succeed Dr. Ewart Brown as Premier did not respond to a request for comment.

Mr. Lister, her main rival in the leadership battle, acknowledged that action would have to be taken.

But he said axing jobs in the midst of a recession was not a sensible option. “We are where we are and we have to look at how we turn this whole thing around. The short cut that says ‘you’ve got to let all these people go’ is not the way to go. We aren’t going to want to do that at this time.”

He added: “What we have to do is be willing to consider attractive early retirement packages for people who are willing to retire – we have to look at reorganizing various areas of the civil service.”

Ed Ball Jnr., general secretary of the Bermuda Public Service Union, agreed that Government needed to “get its spending in order” and ensure “the best bang for its dollar”.

But he said consultants and outside agencies should be first to go if cutbacks were made.

He added: “Any attempts to cut the civil service would have to involve discussion with us.

“Yes, the service has grown but there is an important need for delivery of service and productivity.”

Others have questioned the wisdom of allowing unchecked growth in Government employment — even as private sector jobs declined.

From 2007 to 2009, the Private Sector lost 1,243 jobs; going down from 34,788 to 33,514  —  a 3.3% drop.

Over the same time period, the civil service grew by 912 people from 5,094 to 6,006 — a 17.9% increase.

Political commentator Larry Burchall said: “Given that about 95 per cent of the pay for the civil service is drawn from taxes provided by the private sector, I found it alarming that when the private sector started shrinking the civil service seemed to surge.

“I find that strange as well as difficult to explain or justify. It also leads to inevitable financial consequences.”