Guinea-Bissau’s ever-increasing civil service payroll is ‘the biggest cancer’

Guinea-Bissau’s finance minister, Ilidio Te, said on Monday that the permanent increase in civil service payroll is “the biggest cancer” in the country and that the government must “take its responsibility.”

“The biggest cancer we have is the constant increase in the wage bill, and the government must take its responsibility, must bet on the reduction,” said Ilidio Te.

The Minister of Finance spoke at a press conference following the completion of a technical mission from the International Monetary Fund (IMF) to evaluate the extended loan program.

In the assessment, the IMF again recommends “temporarily suspending the hiring of civil servants and better managing the payroll based on a new census of civil servants.”

About 80% of the revenues of the general state budget are used to pay salaries to civil servants.

“Citizens cannot simply pay taxes to pay wages. They will have to adopt mechanisms, unpopular measures necessary for the well-being of the country,” the minister said.

Ilidio Te also announced a “new census” in public administration.

“We know that there are people who have been outside the country for many years and continue to receive a salary, it is necessary to monitor more regularly and start applying the performance assessment that is in the law. Reform should not be friends, cousins ​​and family members. The reform must be carried out for everyone so that schools and hospitals can be built,” the minister stressed.

When asked about inflation, which was 8.5% in February, the minister stressed that it was “a global economic problem.”

“I think that every country is what it is and should adopt appropriate mechanisms to reduce it. The government took measures in 2022 to mitigate inflation, and we suffered consequences at the level of the State Treasury, and we lost revenue,” he said.

According to Ilidio Te, Guinea-Bissau is included in the “global context”, and the executive branch will take measures to reduce its impact on the population.

As to whether the government intends to privatize more companies, in addition to the already announced privatization of Guinea Telecom, the minister said the situation is being analyzed.

“We observe. We have a situation with EAGB. [Eletricidade e Águas da Guiné-Bissau] which is a huge headache for us and for the fund, and all partners consider EAGB to be a chronic fiscal risk,” he stressed.

“We are going to analyze what is the best solution because companies need to be sustainable and profitable, and when it comes to an electricity and water company, we cannot allow a company to be in constant financial instability,” he said.

This Monday, the IMF recommended limiting budgetary transfers to the utility, which “sorely lacks decisive action to address its ongoing operating losses and poses a significant fiscal risk.”