Teachers’ salary increase demands “unrealistic”; 10% percent per year plus non-salary benefits more realistic

Last Updated on Monday, 27 August 2018, 11:31 by Denis Chabrol

Even as government-employed teachers were Monday due to embark on an indefinite strike for increased salaries, Economics Professor Tarron Khemraj believes the 40 percent demand is too exorbitant and the educators should settle for 10 percent pay hike due to the state of the economy.

“The salary demands of the teachers’ union are obviously unrealistic at this time, but non-salary benefits and a 10% increase per year until 2020 are doable,” he said.

Khemraj disagreed with Political Science Professor, David Hinds’ suggestion that government should advances on its oil revenues to pay the teachers. The Economist instead recommended that government spends more on non-salary benefits such as free university education for all teachers.

“10% salary increase per year until 2020 seems reasonable to me. They have to make the teaching profession attractive again. I find it disappointing that government (PPP and APNU) is failing to consider non-salary benefits as part of payment,” Khemraj told Demerara Waves Online News.

According to the 2018 National Budget, GY$375, 010 million have been set aside for wages and salaries for nursery education; GY$898,072 million for primary education wages and salaries; GY$1,564,191 billion for secondary education wages and salaries and GY$598,547 million or post-secondary/ tertiary education wages and salaries.

The strike call was issued from August 27-the pre-opening week during which registration, orientation and other preparations are made ahead of the start of the academic year- after negotiations broke down for a 2016 to 2020 multi-year package starting at 40 percent and increasing by five percent annually.

However, the United States-based Economist said the increase being demanded by the 7,000 public school teachers is not feasible, but at the same time government could find some of the cash by transferring many of the contract workers to the public service.  “Well, its the job of the teachers to demand these dramatic increases, albeit unrealistic given present fiscal deficit. But ultimately government  has to reach them somewhere. What the government should do is redirect those contract employees in public service (or stop them completely) and direct the wages to teachers. The government can also redirect some non-capital spending to teachers’ wages,” he recommended.

He said government has to muster the “political will” to remove the many contract workers ” who are not doing important things” but have been employed in positions that have been “created for  political party supporters.”

Professor Khemraj said non-salary benefits could include free Bachelor’s Degrees with a condition that those who could not achieve a minimum Grade Point Average of 2.8 must be asked to leave the teaching profession,but if they complete their degrees to set standard, they should also be given free house lots.

“Teachers must know their subject area very well to be effective teachers who can inspire students….They can offer even higher non-salary rewards to those willing to pursue and teach more technical fields. That CPCE (Cyril Potter College of Education)  teachers’ certificate is not enough. People have got to know their subject to teach it,” he added.

Professor Hinds highlighted the importance of paying teachers livable salaries and in turn putting government in a position to in demand better standards in the delivery of education. “Why must teachers beg for a living wage in a country that would be flush with money starting two years from now? If the government does not have the money, then it must rearrange its priorities to find the money. Or as a last resort, borrow the money against the expected oil revenues. If the government can borrow to fix sugar estates to sell them, then surely it can borrow to fix education,” Hinds has said.

However, Economics Professor Khemraj said borrowing against future earnings would require concrete estimates by the Guyana Teachers Union and government on what the projected oil revenues would be.

“Well, first the union and government need to come up with some reliable bootstrapped estimates of what the expected oil revenues will be. I have seen nothing coming from government or union. Finance and Econ 101 says you can only borrow against future earnings if you have reliable estimates of what the future earnings will be in the probabilistic sense…I am not seeing estimates from the locals. And when they do bring consultants, those don’t seem to know what they are talking about either. The terms of the loans will be based on the expected revenues,” he said.

Khemraj recommended that government reduce the fiscal deficit by cutting government spending on wasteful projects, raise taxes or expand the tax base or increase the  growth in Gross Domestic Product (GDP).

In its 2018 mid-year report tabled in the National Assembly recently, the Ministry of Finance said the economy grew by 4.5 percent, comparing favourably with the revised growth rate of 2.5 percent  for the first half of 2017. The report states that tax revenue collections during the first half of 2018 represented 92.2 percent of the 109.2 billion dollars. Internal revenue accounted for GY$48.3 billion during the first half of 2018.

Customs and trade tax collections grew by GY$1.7 billion to GY$9.8 billion and Value Added Tax increased by GY$3.4 billion to GY$22.7 billion during January to June, 2018.