What caught our attention this morning is a daily newspaper headline “Living off Debts: Loan Sharks Strike deep into public servants’ pay packets.”
It was reported that about 94,000 public servants (who account for 70 percent of the total work force) have bank accounts attached to loans or additional loans from the informal sector.
The Public Service Minister, Joseph Sungi is considering ways to curb it to manageable and responsible levels. We agree with him on this.
Despite the fact that the failure by successive governments also contributes to the problem, we believe that the ‘loan’ life of the public servants is based on individual mindsets and decisions.
Of course, our critics may think that the public service legacy issues (public service housing, Consumer Price Index and other incentives) have forced them to resorting to loans.
In business terms, loans are secured to supplement cashflow, sustain operations and for further investments where there are good return. The principle is the same for public servants should they wish to experience economic freedom, live a stress-free life and enjoy high standard of living.
We discourage public servants from getting loans for entertainment and social obligations (bride price, Mokas etc…). There is no return on these should one consider them as ‘investments’ for pleasure and ‘big name’.’
We have observed that the ‘loan-ridden’ public servants at work places show poor attendance which leads to low productivity, their living standards have been declining, engage in private works during paid hours to supplement disposable income and seek commissions (lunch money) in contracts or when the general public want to access the very services that they (public servants) are already paid for by the State. These are bad public service cultures that are contributing to the nation’s regressing.
In order to create a public service machinery that the country can be proud of, these issues highlighted must be addressed. The National Government should make accommodation a condition for public service employment or subsidize rentals for its workers. Regulating the growing real estate market is not viable at the moment. Work places should provide relief measures (i.e. advance school fees) or financial literacy trainings for staff. Public servants should involve in after-hour side hustles to supplement their disposable incomes.
Our position is we want Minister Sungi to legislate loans which are limited to homes and school fees only. We must encourage public servants to nurture saving culture to meet unbudgeted items in future. In-house counseling on loans should help them too.
More than K4 billion of the annual National budget caters for personal emoluments of 133,803 public servants nationwide. Taxpayers would like to see professional and service-oriented public servants who are committed and dedicated to their jobs from 7:45am to 4:06pm on week days. In the long-term, we also agree with Sir Julius Chan’s call for outsourcing the public service should the problems remain impeding PNG’s development.