The salary review promised to the 85,000 civil servants after the publication of the Pay Research Bureau (PRB) report is expected to take effect as from today, April 1.
The government will have to invest from around Rs 2 billion to Rs 3 billion to finance this exercise.
This increase in salary will not, however, result in an increase in inflation, according to economist Swadicq Nuthay, a statement reported by l’Express.mu.
Meanwhile, the budget deficit estimated at 3.5% for the fiscal year ending on June 30 2016 might deepen. The government might even have to let go of certain developmental projects to accommodate for the changes pertaining to the salary review.
On the other hand, the government might have an alternative method. L’Express.mu reports that one of the solutions might be to have recourse to the Consolidated Fund that includes “windfall gains” from the sales of petroleum products; this could provide for hundreds of millions of rupees to finance part of the PRB report implementation.
The government might also increase the price of fuel on international markets for consumers in order to obtain the additional money, reports l’Express.mu.