Dear Editor,
Pension reform is crucial to the success of not only Jamaica’ s economic reform programme, but also the country overall fiscal health. It is not prudent for the Government to be operating a scheme in which civil servants do not contribute to their own well-being.
Critics ought to appreciate that the inability to create a modern pension system will only saddle future generations with debt. Audley Shaw understood this, hence his reason for castigating the present Administration for delaying pension reform. During his budget presentation in 2013, he noted that if the Government failed to undertake pension reform before the end of the present public sector wage agreement in 2016, the consequences could be dire. However, now that Dr Phillips has signalled that, come April, civil servants will be contributing to their pensions, Shaw is trying to score cheap political points.
According to Shaw, pension reform will demotivate employees of the State because it is not accompanied by a higher salary that would have made their contributions more bearable. The problem with this argument is that it does not taken into account the limited fiscal space available to the Goverenment.
Being the Opposition spokesperson on finance allows Shaw to make wild promises, but it is evident that the International Monetary Fund dictates policy. If Shaw were in the position of Peter Phillips he would not do differently. He is just playing to the civil servants because an election is in the near future. But he must learn from history, because during his stint as the minister of finance, he granted increases which contributed to the derailment of the then economic reform programme.
It must also be noted that despite his populist policies his party did not win the last general election. Shaw could better serve his party and country by ensuring that the present Administration examines best practices before seeking to modernise the pension system. Several people may not be happy with the present Administration, but the Jamaica Labour Party will not win the next election unless it proposes credible solutions.
Lipton Matthews
lo_matthews@yahoo.com
Pension reform is crucial to the success of not only Jamaica’ s economic reform programme, but also the country overall fiscal health. It is not prudent for the Government to be operating a scheme in which civil servants do not contribute to their own well-being.
Critics ought to appreciate that the inability to create a modern pension system will only saddle future generations with debt. Audley Shaw understood this, hence his reason for castigating the present Administration for delaying pension reform. During his budget presentation in 2013, he noted that if the Government failed to undertake pension reform before the end of the present public sector wage agreement in 2016, the consequences could be dire. However, now that Dr Phillips has signalled that, come April, civil servants will be contributing to their pensions, Shaw is trying to score cheap political points.
According to Shaw, pension reform will demotivate employees of the State because it is not accompanied by a higher salary that would have made their contributions more bearable. The problem with this argument is that it does not taken into account the limited fiscal space available to the Goverenment.
Being the Opposition spokesperson on finance allows Shaw to make wild promises, but it is evident that the International Monetary Fund dictates policy. If Shaw were in the position of Peter Phillips he would not do differently. He is just playing to the civil servants because an election is in the near future. But he must learn from history, because during his stint as the minister of finance, he granted increases which contributed to the derailment of the then economic reform programme.
It must also be noted that despite his populist policies his party did not win the last general election. Shaw could better serve his party and country by ensuring that the present Administration examines best practices before seeking to modernise the pension system. Several people may not be happy with the present Administration, but the Jamaica Labour Party will not win the next election unless it proposes credible solutions.
Lipton Matthews
lo_matthews@yahoo.com