Who makes more money?

One of my favorite movie is Up in the Air with George Clooney, in which he flies around the country firing employees, in compliance with corporate decisions.

While we can understand that a business wishes to reposition, or downsize, when it comes to the individual that is being sacked it is a personal drama, and the movie reflects on the cruelty of the system, when loyal workers get the boot, by remote.

We can see how deflated and discouraged people get when the trust in their workplace is gone, and what a mess, mass firing can create, on a personal level.

In Aruba we’ve been hearing that GOA must downsize, and help 2,000 to 3,000 of its people relocate and find employment elsewhere.

But how do you do that?

You need a plan.

But so far nothing. We just recently reported that Bashi Premie was paid out, despite the dire economic overview.

The following is what a sitting member of parliament told me when I said that under the circumstances the payment was unreasonable, a mistake.

“I agree with you.” he said, “the minister has to show us yet, where and how she made this possible, in the financial budget, this will take place in March, due to the delay.”

Meaning, Bashi Premie was paid, without parliamentary blessing, probably out of the approved Bubali Plas maintenance budget.

 

One of my readers, writers: Last week, I was thinking about the lavish salaries GOA and their minions give themselves. I was curious about how the average pay in the public sector compares to the private sector. I took a quick look at CBS Aruba, Central Bureau of Statistics website, but could not find an instant answer. Then, my life sucked me back in, and I forgot about my quest.

But, this morning I found out what the gap is, and it is even published on GOA’s own website.

It is a staggering 40%.

Let me repeat: Public servants, on average, get paid 40% more than people working in the private sector. Forty percent!

In principle, the way it ordinarily works, we are not here to serve GOA. Public servants are here to provide services to us, the people. We should pay them a reasonable salary, but not more than that. And their remuneration should reflect the quality of service they provide.

Based on my findings, we should not cut public salaries by 12.6 percent, but by 40. Now GOA, do your job and tell that to the Labor Union leaders, and make it happen, without further disruption of the society and/or the economy.

 

This is what GOA published, and archived, in December of 2019:

Preliminary study by the IMF on government personnel costs

ORANJESTAD – Recently the Minister of Economic Affairs, Finance and Culture Xiomara Ruiz-Maduro informed that during two weeks the experts of the International Monetary Fund (IMF) did an investigation on GOA personnel costs.

Public wages and interest costs are the two biggest components of GOA’s budget expenses. The reason for this investigation is for GOA to get a good picture of the wage costs when making decisions. Wage costs cannot continue to increase and GOA has to contemplate lowering it to reach a manageable and sustainable public finance.

In its investigation, the IMF made a comparison between the personnel cost in the public and private sector and made a comparison between Aruba and the countries of similar size.

The result indicates that GOA personnel costs, the public sector, are substantially higher than in the private sector. Wage costs in the public sector include GOA’s employees and persons treated as such, gelijkgestelden, whose salaries are subsidized by the government. If we compare these two groups, GOA’s workers earn 40% more than the one working in the private sector, whereas the gelijkgestelden earn 20% more than workers in the private sector.

In regards to the age component, the age of public sector employees is increasing. This means that eventually, a great number of government employees will reach retirement age. This presents a challenge, and retirement age must be increased.

If one compares the wage cost of the public sector in Aruba with other Caribbean and Latin American countries, GOA’s wage cost is higher. Compared to other countries, GOA also has more employees in its service.

Overtime costs are also one of the components that increase personnel costs. The overtime component comprises 5% of total personnel costs. To reach this percentage, the IMF experts used 2018 figures.  The budget of the Department of Justice had higher overtime costs. Overtime pay represented 17% of the budget. Further investigation is required to analyze the reason for overtime.

My reader concludes: Don’t you think it is strange when servants get paid more than the masters?

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January 17, 2022
Rona Coster