In 2009, the Central Bank in a special report warned the government’s fiscal operations was in a ‘precarious position’, urging the government to desist from bloating the public sector unless such appointments were accompanied by improvements in productivity.
That year, the government created 44,532 new vacancies. The budget deficit, which was supposed to be less than eight percent of GDP that year, ballooned to 9.9 percent.
The government seemed to heed the Central Bank’s warning. In 2010 new vacancies created amounted to 5,302. In 2011, the number of new vacancies created improved further to 3,950, recent data released by the Ministry of Finance and Planning showed.
However, according to the Treasury the creation of new vacancies surged to 25,470 during the first eight months of this year alone, a bulk of these were created at ministries to absorb 18,128 graduates.
Salaries and wages paid during the first eight months of 2011 amounted to Rs. 222.3 billion, and has increased by Rs. 6.5 billion to Rs. 228.8 this year accounting for 29.3 percent of total recurrent expenditure of the government which amounted to Rs. 780.9 billion.
The overall budget deficit during the first eight months of this year amounted to Rs. 454.6 billion, a 30 percent increase from a year earlier, which was 6 percent of GDP. The full year deficit target is 6.2 percent.
Earlier this month, the Economic Development Ministry said the Government has decided to give 51, 420 graduates currently undergoing training in the state sector permanent appointments next year in accordance with regulations pertaining to Development Service Officers. "This is the first time that a government is absorbing the highest number of graduates to the State Sector with the objective of strengthening the public service by obtaining their services to meet people’s needs at national and regional levels for accelerated development," the ministry announced.