‘Cut 20,000 jobs’
Trevor Hamilton reckons that the Government can cut 20,000 jobs and create three times as many in the private sector in one go.
The international management consultant suggests that a voluntary redundacy exercise be undertaken, along with the privatisation of 150 support services and developmental approval.
Ultimately, he figures those actions could lead to 6.7 per cent annual economic growth and a 19 per cent reduction in government housekeeping expenses.
“Over the last years we hear about public sector reform, public sector transformation, modernisation, rationalisation, and none of them have produced anything,” he said, suggesting that while culling the public sector workforce would cost $20 billion in redundancy payments, around three-quarters of the departing workers would reinvest in business.
“Of 20,000, 15,000 may want to invest,” he said. “They in turn will each create two additional jobs.”
But Hamilton goes further to recommend that certain services could be divested.
He figures that converting 150 economic support services into 150 enterprises could add another 10,500 jobs.
“The government has a whole set of undercapitalised economic support services,” said the management consultant. “We pay somebody to do it, for example, the post office… People don’t use the postal services. Would you put money to move things through the post office, they don’t have the technology there is lack of technology; we should get rid of them.”
Additionally, privatising developmental approval process would not only free up the construction industry, which creates jobs quickly, but would create additional opportunites for some 6,000 professionals.
“It can take three years to get a plan approved,” said Hamilton. “When there’s construction going on, everybody makes money.
“I’m saying, take away the government approvals, give the professionals — the architects, the civil engineers, etc — give them a licence so they can approve the plan,” he added. “This will help move along the process. And if they do hanky panky charge them $10 million and take away their licence.”
Another 6,000 jobs could also be created by implement a land leasing programme targeting about 200 strategic projects.
Hamilton was speaking on means by which Jamaica can capitalise on an International Monetary Fund (IMF) programme, two weeks ago.
The high public sector wage bill is one of the key areas the multilateral lending agency wants to be addressed.
But for close to a decade, the Government has been delaying job cuts, in favour of a wage freeze agreement.
“Wage freeze and demand management are not helpful solutions,” said Hamilton. “You should not manage demand, while wage freeze will only buy you time and time is running out.”
He added: “Jamaica has to find credible solutions and execute. IMF can only be successful if we execute a good recovery programme.”