Public sector wages: Adopt performance index approach - Andah urges govt

The Managing Director of the Bank of Africa, Kobby Andah has advised government to match public sector wages to personnel productivity.

This, he believes will bring about value for money in the payment of salaries for government workers.

Despite the huge money spent on paying personnel in the government sector, the public sector has been marred by low levels of productivity.

Managing Director of the Bank of Africa, Kobby Andah says government should adopt a performance index pay approach towards public sector wages.

“The situation where government spends a large percentage of the GDP on salaries is even worse than was thought of because it is known to be around forty percent but the special advisor to the Finance Minister through a presentation has displayed that it is worse.

If you take out the earmarked funds and see what is left, he said about eighty percent goes into salaries. What it means is that we actually borrow to pay salaries, and it is not sustainable.

There are structural problems and if we don’t do anything about it, they will be with us twenty years from now,” he told Citi News.

He believes the performance index approach in the private sector could be incorporated in the public sector.

“The proposal is that just like most modern organisations that have a performance index pay — if you don’t deliver the results, you don’t get the pay– I think these kinds of reforms should come into the public sector.”

Governments over the years have strived to sanitize and improve the level of productivity in the sector considering its importance to the growth and development of the country.

On the average, about forty percent of Ghana’s total revenue is used to pay salaries of government sector workers.

In 2019, government spent a little over GH¢22 billion on employee compensation, the figure in 2020 jumped to GHS28 billion representing a 27% increase.

Total revenue for 2021 is projected to rise to GH¢72.4 billion. A huge chunk of this figure will once again be used to pay public sector workers.

This, he believes will bring about value for money in the payment of salaries for government workers.

Despite the huge money spent on paying personnel in the government sector, the public sector has been marred by low levels of productivity.