Public sector workers are to enjoy a 12.5 per cent increase in their base pay with effect from January 2017, the Minister of Employment and Labour Relations, Mr Haruna Iddrisu, has said.
An agreement to that effect was reached at the Public Service Joint Negotiating Committee (PSJNC) meeting in Accra yesterday.
The meeting was attended by the Minister of Finance, Mr Seth Terkper; Mr Iddrisu, officials of the Fair Wages and Salaries Commission (FWSC), as well as the social partners of the government, led by organised labour, leaders of public sector workers unions, the Ghana Prisons Service and the Ghana Police Service.
Mr Iddrisu described the agreement as historic and a major breakthrough on wage negotiations that would allow the Minister of Finance to effectively plan and incorporate the base pay in the 2017 budget.
The announcement of the base pay came at a time when teachers of colleges of education and public sector pharmacists have embarked on a strike over salary issues.
The base pay is the initial rate of compensation an employee receives in exchange for services. It excludes extra lump sum compensation such as bonuses or overtime pay, as well as benefits.
An employee’s base pay can be expressed as an hourly rate or as a weekly, monthly or annual salary.
Last week, the government and its social partners, comprising the Ghana Employers Association and organised labour, announced a 10 per cent increase in the national daily minimum wage largely for the private sector.
The minister said the enforcement of the minimum daily wage which largely affected the private sector was the bane of salary administration in the country and warned of severe sanctions against entities that would pay below the minimum wage.
Mr Iddrisu explained that the determination of the base pay of 12.5 per cent, slightly higher than the 10 per cent minimum wage, was to help ensure equity in the salary structure within the public sector under the Single Spine Pay Policy (SSPP).
He hinted that the government would cede 30 per cent of internally generated funds (IGFs) of the Judiciary for use by that organ of government to address its financial challenges.
He declared the willingness of the government to deal head-on with the housing challenges facing public sector workers and said it was ready to provide land banks for the development of a public sector housing scheme for workers to save them from the huge rents they had been paying.
That scheme, Mr Iddrisu said, would be executed in partnership with the private sector and urged the public sector to collaborate with the government and the private sector for its implementation.
For his part, Mr Terkper explained the state of the economy to the participants at the meeting and the implications of labour’s demand for higher pay increases for the economy.
He said the ability to pay, the low revenue from the oil sector and the low production of the oil sector were some of the challenges confronting the economy.