26 May 2009

Tonga Public Service Commission says pay rise could boost economy

9:04 pm on 26 May 2009

The Public Service Commission in Tonga says a 10 percent pay rise for public servants could boost the country's economy.

The government has approved a 10 percent pay increase for public servants, which the Commission says will be paid for by productivity gains achieved by reducing entitlements to sick leave and annual leave.

Tonga's leading pro-democracy MP, Akilisi Pohiva, says now is not the right time for a pay rise because the country's economy is going down the drain.

But the chairperson of the Public Service Commission, Mishka Tuifua, says the pay boost could help the economy

"The Ministry of Finance are of the view that the salary adjustment will not cause inflationary pressures and in fact may assist the local business markets, from perhaps the expected improved pay rates of public servants and local consumption."

Mishka Tuifua says funding the pay rise from outside of the payroll budget was never considered.

But Akilisi Pohiva and the Public Servants Association say they've heard government ministries will have to cut services to pay for the salary boost.