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In an attempt to ease the burdens on citizens, public sector workers resumed their duties, but all they received were promises to improve their financial conditions by adjusting their salaries by an amount equivalent to fifty percent of their value in 2019.
The employees gave the government a few days to complete its study on the required increases, while expressing clear concern about the possibility of these promises remaining just talk, especially with talk of the International Monetary Fund’s strict conditions for any increases in employee wages.
Aside from the political wrangling and warnings against imposing new taxes to finance any increase, Dr. Patrick Mardini, head of the Institute for Market Studies, believes that any step aimed at increasing the budget deficit in the absence of clear sources of income to finance salary increases may herald a repetition of the financial crisis that the treasury previously faced, when the series of ranks and salaries for the public sector was approved in 2017.
Regarding the difference in current conditions compared to 2017, Dr. Mardini reveals that the situation today is much worse than it was previously when the series was approved based on false estimates that were marketed as financingable, as the cost was estimated at about $866 million, and the government then resorted to imposing new taxes, which led to a decline in revenues instead of an increase due to tax evasion, which accelerated the collapse.
Mardini confirms that the government today is incapable of borrowing and increasing revenues, as well as imposing new taxes, and there are no deposits that can be used to cover the treasury deficit, meaning that the promises are not achievable.
Regarding the next step, especially since employees are threatening to go back on strike while the government faces successive crises, the latest of which was dealing with hundreds of cracked buildings in Tripoli that are threatened with collapse, as happened last Sunday, Mardini stresses that the reserve amount that the government allocated in the budget for emergency expenses, amounting to $300 million, was distributed during the budget discussion session among the ministries and the Southern Council, and no representative demanded that this money be allocated to employees, despite their subsequent populist positions on the eve of the crisis. Parliamentary elections.
Therefore, regarding the proposed solutions, Mardini does not see any solution on the horizon except through radical reform of the public sector, followed by approving fair increases.
