Brouhaha over pay hikes

Monday 04th March, 2024

The Central Bank of Sri Lanka (CBSL) is drawing heavy flak for having granted its workers generous pay hikes amidst a crippling economic crisis. Its critics are arguing that such salary increases, allegedly ranging from 29% to 70%, should not have been given at a time when the government is asking other state employees as well as the public to tighten their belts; their argument has struck a responsive chord with the irate public, as evident from a reader’s letter published in this newspaper today.

Some critics of the CBSL have gone to the extent of blaming the pay hikes at issue on the Central Bank of Sri Lanka Act, No. 16 of 2023., which was introduced to ensure the independence of the CBSL, which has disputed their contention by pointing out that the salary increases were worked out according to a collective agreement, which came into being during President Chandrika Bandaranaike’s tenure in 2000, and had nothing to do with the CBSL Act.

The CBSL says it was left with no alternative but to abide by the 24-year-old collective agreement which a group of trade unions, including those representing the UNP, the SLPP and the JVP, is also a party to, as regards the triennial pay revision; its workers will not receive salary increments until 2027, the CBSL has said. The violation of a collective agreement is a justiciable offence, and if the CBSL had refused to grant pay hikes in keeping with the pact, the trade unions would have resorted to legal action against it, triggering a labour dispute at the bank of banks, which should be free from such trouble at this juncture.

Parliament has granted the CBSL’s request for a meeting to present its side of the story. This is something overdue. That meeting should have taken place much earlier. It has been reported that a CBSL delegation is scheduled to appear before the Committee on Public Finance (COPF) tomorrow. The CBSL should make available to the public and Parliament all information about the pay hikes granted to its employees in the past and the percentages thereof, under successive governments, and reveal if the current pay hikes are unusually higher than the previous ones.

It is hoped that the COPF will ask all necessary questions anent the CBSL salary revision issue when it meets the CBSL top brass. It ought to find out the percentages that the CBSL workers’ pay hikes average per annum and compare them with what the professionals in other sectors are entitled to, besides revealing the selection criteria governing the CBSL recruitments, and the educational and professional qualifications of the CBSL officials.

Now that Parliament has undertaken to probe the CBSL pay hike issue, it should grasp the nettle; it ought to address the root cause thereof. If it thinks the CBSL workers do not deserve the salary increases or the pay revision should be postponed in view of the current economic situation, it ought to explore ways and means of amending or abolishing the collective agreement at issue. There is no other way out. If there are labour laws preventing Parliament from dealing with the issue, let them be amended or done away with forthwith.

Much is being spoken about parliamentary sovereignty, which, according to the Westminster tradition, means that Parliament can create or end any law in a constitutionally prescribed manner. So, the current Parliament of Sri Lanka should be able to do away with the collective agreement pertaining to the CBSL pay revisions if it so desires. The SLPP, the UNP and the JVP leaders ought to pressure their trade unions that are signatories to the collective agreement between the CBSL workers and their management to be considerate enough to heed the country’s pecuniary woes and agree to lower pay increases. However, Parliament will have to take responsibility for the consequences of such a course of action; the CBSL says it has already lost a large number of experts, who have migrated and joined international financial institutions. What will happen to the ongoing economic recovery efforts if more CBSL personnel vote with their feet in a huff in the event of being deprived of pay hikes? This problem however will not arise in respect of the CBSL drivers and peons!

The legislators who have taken moral high ground should also reveal whether there have been increases in their own salaries and/or allowances over the past two years or so. Above all, they should tell the public whether compensation has been paid for damages that the SLPP MPs’ properties suffered at the hands of violent protesters in 2022, how much was spent, and whether the victims had declared those assets officially and disclosed how funds were raised for their acquisition.

Public funds must not be used to pay compensation for damages to ill-gotten assets of politicians. Let the MPs also be urged to disclose how much parliamentary sittings cost the public a day, and how they propose to tackle the problem of absenteeism among them and the resultant inquorate sessions which amount to an utter waste of public funds. Besides, the public has a right to know the educational and professional qualifications of the MPs they maintain, or at least the ministers, who draw much bigger salaries than most bankers.

One can only hope that the legislators will get to the bottom of the CBSL pay hike issue, and sort it out once and for all, instead of bellowing rhetoric and, above all, respect the people’s right to information in respect of the remuneration and perks of the MPs, most of whom are notorious for dereliction of duty, inefficiency, misconduct, and various malpractices.