If there is one thing we doggedly refuse to learn from past experience is the need to keep the public payroll under control. We have very quickly forgotten what happened in 2012/13 when the state, having lost access to the markets, had to borrow money from a semi-governmental organisation to pay public employees their 13th salaries. The situation eventually became manageable by imposing pay and pension cuts which were all eventually lifted.
It is not only the generous pay and pensions that have been restored, the government has also reverted to the continual hiring of public employees, oblivious to the risks this poses. The number of employees in the broad public sector increased by 2.3 per cent in the first quarter of 2020, compared to the corresponding period of last year. This represented 1,527 more workers, which might not seem a very big number if the public sector were not already overstaffed.
When it was hiring all these people, the government did not know there would be a pandemic, that the economy would be shut down for three months and that public finances would require very careful management, with the public debt to hit 11 per cent of GDP from 98 per cent. Then again, the good economic performance of the last few years should not have been seen as a licence to keep hiring public employees because the state could afford it. Conditions can change for the worse in no time, as we have seen, and the state has to juggle public finances because it is lumbered with a payroll it cannot afford.
A prudent government after the crisis of 2013 would have reorganised the public service, transferring workers from over-staffed and underworked departments to those that were understaffed. This is what sound management of human resources dictated, but the all-powerful Pasydy union still refuses to agree to transfer of staff to a different ministry. For years, governments have unsuccessfully tried to secure Pasydy’s consent.
Digitalisation of the public service is the other thing that should have been pursued, but past efforts had not got very far because the government was not very committed to it and Pasydy did not support it. Now, with the establishment of the deputy ministry for digitalisation, big steps forward have been made in the last few months, but there is still a long way to go before we can talk about e-government, without just referring to a few services.
Digitalisation is what the government should focus its efforts on, especially now the recession will hit public finances. If it is done properly and staff transfers are permitted by Pasydy, there should not be any need for new appointments in the public service for at least the next two years. We hope the government can see this.