Jordan government to raise public sector wages next year

Jordan's Prime Minster Omar Razzaz said the government took the decision to increase the country's public sector wages. (AFP)
Updated 05 December 2019

Jordan government to raise public sector wages next year

  • Jordan raises public sector salaries to pre-empt civil unrest
  • Wage increases put more pressure on government finances

AMMAN: Jordan agreed on Thursday to public sector wage rises, a move that will increase government spending at a time of rising public debt but is crucial to stave off social instability, officials said.
Prime Minister Omar Al-Razzaz said the government took the decision, which covers 700,000 state employees including army personnel and civilian and military retirees, even though the country’s finances were stretched.
“The economic situation and the exceptional circumstances that Jordan is going through in the region necessitates improving living conditions,” Razzaz told an audience of officials and prominent figures.
The government, which has said it will not resort to new taxes, is mindful of protests in neighboring countries, including Lebanon and Iraq, in the past month over eroding living standards and corruption.
Tax rises pushed by the IMF last year sparked some of the biggest demonstrations in years and were also blamed by economists and politicians for a contraction in business activity.
The last significant public sector pay rises in 2010 and 2011 were part of billions of dollars in extra social spending to curb protests inspired by regional uprisings.
The public sector has over the last two decades expanded rapidly as successive governments sought to appease citizens with state jobs to maintain stability.
The runaway spending contributed to a soaring $40 billion public debt, equivalent to 94% of gross domestic product which Jordan has been struggling to rein in under a three-year IMF program that ended this year.
The latest wage increase, which starts next year, will give state workers from bureaucrats to drivers pay increases ranging from 15 to 20 percent along with other substantial rises to army pensioners and civil servants.
They will add at least half a billion dinars ($700 million) to salaries and pensions that already consume the bulk of state expenditure in the 9.8 billion dinars ($14 billion) 2020 draft budget.
The spectre of bigger spending has already alarmed the IMF mission that came in November and will return in January to hold talks over a reform program, officials say.
Jordan wants the new program to focus on raising growth that has been stagnant at around 2 percent in the last decade and reduce record unemployment, which has risen sharply in the last two years to 19 percent, they added.
Jordan would resist any push by the IMF to adopt more austerity measures that risked increasing stability and civil unrest, officials say.
The government hopes higher revenues in revived economic activity in a country that has been hit by regional turmoil would help offset the wage bill hikes.
“We hope it will push growth and raise revenues and move the wheels of the economy,” Finance Minister Mohammad Al Ississ said.


Israeli Cabinet postpones vote on West Bank annexation

Updated 22 sec ago

Israeli Cabinet postpones vote on West Bank annexation

  • A Cabinet vote on annexing territories on Sunday was not technically feasible because of various preparations
  • Hard-line Israeli nationalists have called for the immediate annexation of West Bank settlements
JERUSALEM: A senior Israeli minister said on Wednesday that a Cabinet vote to endorse annexation of parts of the West Bank will not take place early next week, despite Prime Minister Benjamin Netanyahu’s pledge a day earlier to act quickly after the US released a peace plan rejected by the Palestinians.
Netanyahu said he would ask the Cabinet to advance the extension of Israeli sovereignty over most Jewish settlements and the strategic Jordan Valley, a move that would likely spark international outrage and complicate the White House’s efforts to build support for the plan.
Tourism Minister Yariv Levin told Israel Radio that a Cabinet vote on annexing territories on Sunday was not technically feasible because of various preparations, including “bringing the proposal before the attorney general and letting him consider the matter.”
Hard-line Israeli nationalists have called for the immediate annexation of West Bank settlements ahead of the country’s third parliamentary elections in under a year, scheduled for March 2.
They have eagerly embraced the part of President Donald Trump’s peace plan that would allow Israel to annex territory but have rejected its call for a Palestinian state in parts of the occupied West Bank.
The Palestinians angrily rejected the Trump plan which largely adopts the Israeli position on all the thorniest issues of the decades-old conflict, from borders and the status of Jerusalem to security measures and the fate of Palestinian refugees.
Levin, a senior member of Netanyahu’s Likud party, said the Palestinian state envisioned by the Trump peace plan is “roughly the same Palestinian Authority that exists today, with authority to manage civil affairs,” but lacking “substantive powers” like border control or a military.
Jordan, which has a peace treaty with Israel, has warned against any Israeli “annexation of Palestinian lands,” reaffirming its commitment to an independent Palestinian state formed on the basis of the pre-1967 lines with east Jerusalem as its capital.
The Palestinians seek the West Bank and annexed east Jerusalem, which Israel captured in the 1967 Mideast war, as part of a future independent state. Most of the international community considers Israel’s West Bank settlements illegal under international law.
Israeli Defense Minister Naftali Bennett tweeted Wednesday that “that which is postponed to after the elections will never happen.”
“If we postpone or reduce the extension of sovereignty (in the West Bank), then the opportunity of the century will turn into the loss of the century,” said Bennett, a hawkish Netanyahu ally with the New Right party.
Nahum Barnea, a veteran Israeli columnist, stridently criticized the Trump plan in Wednesday’s Hebrew daily Yedioth Ahronoth, saying it would create a Palestinian state “more meager than Andorra, more fractured than the Virgin Islands.”
He cautioned that annexation would lead to “a reality of two legal systems for two populations in the same territory — one ruling, the second occupied. In other words, an Apartheid state.”