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Sri Lanka spends 54% percent of tax revenue on government jobs; unemployment down to 6.5%
Tuesday, 17 April 2007 - 7:25 PM SL Time
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Sri Lanka has spent 54 cents out of every tax rupee collected last year on government jobs and pensions, while plans are afoot to hire 20,000 more people into the already bloated public sector.
Official data has revealed that last year the government spent 233 billion rupees on government salaries, wages and pensions, which is 54 percent of the total tax revenues of 428.3 billion rupees.
From 2004 the government had hired more than 40,000 unemployed graduates into the public service, fulfilling an election promise to give state jobs to all unemployed graduates who either lack the skills or the willingness to work in tough private sector jobs where the hours are long and their salaries are taxed.
Biggest Item:
`Expenditure on salaries and wages increased by 26.3 per cent to 175 rupees billion mainly due to the increase of public sector salaries in 2006, correction of salary anomalies, introduction of a monthly cost of living allowance for public servants, new recruitment of nurses, clerical staff, technical staff and home guards and the full impact of recruitment of over 40,000 graduates to the public service,` Sri Lanka`s Central Bank said in its annual report.
`It was the highest single expenditure item, which accounted for 32 per cent of the total recurrent expenditure. Correction of pension anomalies and the increase granted in 2006 were attributed for the increase in pension payments by 24 per cent to 58 billion rupees.`
According to the last budget speech, government wages and pensions are expected to cost 264.9 billion in 2007, compared to projected tax revenues of 540 billion rupees for 2007 or 49 cents out of every tax rupee collected.
But analysts say the number may worsen because revenues usually undershoot targets while expenditures overshoot.
Government officials receive largely tax free salaries and pensions, while private sector workers and corporation employees` salaries are taxed and their pension fund, the Employee`s Provident Fund (EPF), is also taxed.
EPF Tax:
Last year, the EPF, which collects the pensions contributions of some two million private sector and corporation workers each year, had to pay 2.7 billion rupees in income taxes, while its returns fell far below inflation because it invested the proceeds at low rates in government securities in an environment of financial repression.
Sri Lanka is believed to have over one million government sector workers though the exact number has not been made public.
Director General of Statistics Suranjana Vidyaratne said the exact number could not be revealed because the military strength was a state secret, but unemployment had fallen to 6.5 percent in 2006.
Deputy finance minister Ranjith Siyambalapitiya said last month that some 18,000 vacancies had been identified in the public service.
`The government hopes to give employment to 20,000 graduates this year,` he told a news conference. `So there`s no need for anyone to agitate.`
He was referring to demonstrations by unemployed graduates who are demanding jobs in the state sector.
Free Jobs:
The graduates have been egged on by Sri Lanka`s Marxist-nationalist Janatha Vimukthi Peramuna, which has a strong base in state universities where tertiary education is given free of charge.
Clashes and politically-led strike action in the universities result in frequent closures and delays in graduations.
The island`s public service is large seen by a long-suffering citizenry as over-staffed by under-performing officials who enjoy government pensions without contributing to a pension fund.
Siyambalapitiya also said the government had already hired 1,000 graduates into the Inland Revenue Department, a key government organisation that had suffered staff shortages.
The government is reforming the department in an effort to improve the efficiency of tax collection and increase government revenue.
Last year, the department collected 80.4 billion rupees in income taxes and 165.5 billion in value-added taxes totaling 245.9 billion rupees which was enough to meet the salary and pension bill of 233 billion rupees..
The government has also announced that 20,000 cars would be offered to government servants at a fraction of the duty paid by private citizens who have to cough up over 200 percent in taxes to buy a car.
In late 2004 the government raised taxes on cars to discourage imports after a money printing binge precipitated a balance of payments crisis.
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ajan
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17 Apr 2007 12:46:42 GMT Report for Abuse
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Lee Kuan Yew, 1998
Lee Kuan Yew: the Man and His Ideas is the title of a book published in Singapore in 1998. Written by three Straits Times journalists Han Fook Kwang Warren Fernandez and Sumiko Tan, the book carries fresh interviews with Lee Kuan Yew on the events that shaped his life and the way he governed Singapore.
Now in his graying years - he is 74 now - the founding father of Singapore is regarded as virtually a national institution at home. In transforming a busy ramshackle port city on a resourceless island into a prosperous multi-lingual nation, he created a model for other developing countries. He left the premiership in 1990 and assumed the role of, senior minister, but wields as much prestige and influence today as he did while holding office, a distinction rarely earned by any politician in any other country.
In talking of Sri Lanka, this is what Lee Kuan Yew says: -
'We have got to live with the consequences of our actions and we are responsible for our own people and we take the right decisions for them. You look at the old Philippines. The old Ceylon. The old East Pakistan and several others. I have been to these countries and places. When 1 went to Colombo for the first time in 1956 it was a better city than Singapore because Singapore had three and a half years of Japanese occupation and Colombo was the centre or HQ of Mountbatten's Southeast Asia command.
And they had sterling reserves. They had two Universities. Before the war, a thick layer of educated talent So if you believe what American liberals or British liberals used to say, then it ought to have flourished. But it didn't.
One-man one-vote led to the domination of the Sinhalese majority over the minority Tamils who were the active and intelligent fellows who worked hard and got themselves penalised. And English was out. They were educated in English. Sinhalese was in. They got quotas in two universities and now they have become fanatical Tigers. And the country will never be put together again.
Somebody should have told them - change the system, loosen up, or break off. And looking back, I think the Tunku was wise. (The reference is to Tunku Abdul Rahman the Malaysian Prime Minister under whose rule Singapore separated from Malaysia).
I offered a loosening up of the system. He said: 'Clean cut, go your way'. Had we stayed in, and I look at Colombo and Ceylon, I mean changing names, sometimes maybe you deceive the gods, but I don't think you are deceiving the people who live in them. It makes no great difference to the tragedy that is being enacted.
They failed because they had weak or wrong leaders '. |
Pera
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17 Apr 2007 13:00:09 GMT Report for Abuse
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Rohanlingam and his LTTE bathroomslipper licking friends seemd to be dead scared of JVP!!
Pawenda.
PERA |
LionGr
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17 Apr 2007 13:09:35 GMT Report for Abuse
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There are these set of people who are born to look at there lives negalively... so i think we should ignore them..
even if there is a harmful aspect we should try to get the positive points from it.. but these guys try even down the good aspects....
when will they ever learn to come up in life...
thats one reason why Sri Lanka is like this...
dont you agree Pera Bro....??? |
Saint
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17 Apr 2007 13:13:42 GMT Report for Abuse
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Sri Lanka spends 54% percent of tax revenue on government jobs;
Huge numerical picture to deal with eh, but they are spending 54% from tax money and that means other government incomes are excluded for this spending.
unemployment down to 6.5%
Excellent, this is one of the positives when you have a small country on your hands.
;-D |
Sritharan
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17 Apr 2007 13:22:48 GMT Report for Abuse
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Ajan, that is a wonderful article.
These people have been sucked into 6.5% unemployment rate statistic. The sad thing is that many educated talents and also many Sinhalese women leave the country for good employment.
Yes, you can come to the magic figure by subtracting (or I could say hiding) the fact. |
Pera
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17 Apr 2007 13:23:55 GMT Report for Abuse
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Rohanlingam,
There is a two tamil sayings.
There is two Tamil sayings or There are two Tamil sayings?
I thought Tamil languege has more than two sayings!!
One is that who has patience will rule the world.
Tamils are going to Rule the world! Good. I am sure Mr Bushlingam is a Tamil.
The other is that the tiger hides only to strike.
and SLA is going to have the Tiger hide soon..by skinning the tiger ALIVE!!
Shout as much as you want. The next tamil new year will be celeberated in an independent eelam.
AKA Hell
No wonder you too want to dildo worship.
I am going to be a pagan...thats why I took in to Dildoism.
May almighty goat bless you.
PERA
666 |
groovygirl
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17 Apr 2007 13:25:17 GMT Report for Abuse
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Government officials receive largely tax free salaries and pensions, while private sector workers and corporation employees' salaries are taxed and their pension fund, the Employee's Provident Fund (EPF), is also taxed.
No wonder you get a better service from government officials :)))
gg |
Maitreya
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17 Apr 2007 13:31:29 GMT Report for Abuse
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Is that includes military personnel salaries?
Or it is treated as National security expence? |
groovygirl
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17 Apr 2007 13:33:26 GMT Report for Abuse
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Saint:
I am fine, thank you, how are you? Too bad we lost the game :((
gg |
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