Ghana will give public-sector workers a 13 percent pay rise this year, the first increase since 2013, when the government froze annual increments as part of its efforts to cut spending, the finance ministry said on Tuesday.
The West African nation, which produces gold, cocoa and oil, is in talks with the International Monetary Fund on an assistance package to fix its fiscal problems, which include a wide budget deficit partly caused by government salaries.
As part of its stabilization plan, the government froze annual wage increases in 2013. Since then, it has paid an annual 10 percent ‘cost of living allowance’ but left wages flat.
Read also: The return of public investment
Deputy Finance Minister Cassiel Ato Forson told Reuters the salary increase was agreed after talks with labour unions and will be based on basic pay in 2013. The increase will come into effect this month and employees would not be paid any arrears, he said.
“We believe (the IMF) will have no problem because we are still within the budget limit discussed with them,” Forson said.
Finance Minister Seth Terkper said last week that a final policy document was be completed for submission to the IMF board for approval and he hopes Ghana could have a program in place in the first quarter of 2015.