Head of Government, Youssef Chahed has announced that Ministers’ salaries are to be cut by 30 percent ahead of the likely introduction of his anticipated austerity program.
According to the government press agency, TAP ministerial salaries for the 40 ministers and junior ministers, who earn around $1,800 a month, will be reduced by about $500. Reporting upon the reduction in salaries, Reuters quoted a government official as saying the next step would likely be to reduce bonuses for senior officials in the public sector.
early indications of a potential austerity program came last week, with the axing of some 1,000 jobs from the country’s national carrier, Tunisiair. Tunisiair, together with many of the country’s state owned enterprises, such as the troubled phosphate mining company, Compagnie des phosphates de Gafsa, produced collective losses last year of some $1.5 billion. Chahed has warned that more dramatic cuts will be inevitable if Tunisia does not overhaul the way many of the country’s state-run enterprises are operated.
According to the African Development Bank, public sector salaries in Tunisia represented 38% of last year’s budget and 13% of the country’s overall GDP, one of the highest proportional spends in the world. Under an austerity program, all government expenditure would be cut dramatically. According to the same source, much of the increase in wage costs can be traced back to the years immediately following the revolution, when public sector recruitment increased by 75 percent.
However, the country’s trade unions and opposition groups have opposed any potential job cuts, saying that lay offs in the public sector run counter to the Carthage Agreement, (the plan agreed by a number of Tunisia’s parties to steer the country through its current crisis) and unduly punish workers for decisions taken by government. Speaking to Tunisia Live last week, Constitutional law professor and member of the Popular Front, Ahmed Safi said that lowering people’s salaries and decreasing the number of employees in the workforce were initiatives ordered by the International Monetary Fund (IMF) and the World Bank rather than genuine Tunisian policy.
“Chahed has warned that he will resort to an austerity program if he feels he needs to.” Safi said, “However, the Tunisian General Labor Union (UGTT) will definitely oppose this decision. We shouldn’t let go of our institutions easily. We shouldn’t submit to the IMF or the World Bank.”