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HONIARA, Solomon Islands (SIBC, Jan. 8) - The single biggest cost in the Solomon Islands 2004 recurrent budget is the government payroll, which accounts for more than $188.8 million.

This accounts to over 52 percent of the domestic sourced revenue in 2004, which government considers too high.

Prime Minister Sir Allan Kemakeza said because of this, the Ministry of Finance had embarked on a full payroll cleansing exercise as part of government's broader economic reform measures.

Kemakeza’s remarks come as public workers in the Solomons threaten to strike over requested pay raises.

Kemakeza said the ability of the government to fund the payroll is dependent on the private sector and overall economic recovery.

Sir Allan pointed out that a stronger private sector that ensures a rise in tax revenue would be a necessary pre-requisite for a public sector pay rise.

Sir Allan said a substantial pay increase to public servants in the current environment would reflect one of the worst policy errors that Solomon Islands could possibly make.

January 8, 2004

Solomon Islands Broadcasting Corp.:


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