TABLE OF CONTENTS Page 1 INTRODUCTION 7 1.1 “Pay” Defined 7 1.2 Pay is a Key Public Service Issue 8 1.3 Diverse Interests and Policy Objectives Complicate Pay Decisions 12 1.3.1 Pay policy may be used to pursue egalitarian and equity goals 13 1.3.2 Labour unions and vested groups in the public service often ignore labour market prices 14 1.3.3 Raising pay is difficult when budgetary allocations to operational and maintenance (O&M) costs are low 15 1.3.4 Significant improvement in service delivery entails expansion of the workforce 15 1.3.5 Pay operates in conjunction with other organisational and managerial systems 16 1.4 Politics is Inherent in Public Service Pay Decisions 17 1.5 Study Objectives and Hypothesis 18 1.6 Study Approach and Methodologies 19 1.7 Scope of the Study 19 1.8 Problems, Constraints and Implications 20 1.9 Structure and Content of the Study Report 21 2 A COMPARATIVE OVERVIEW OF PAY TRENDS AND STRUCTURES 22 2.1 Introduction 22 2.2 Pay Trends 22 2.3 Wage Bill Levels 27 2.4 Pay Structures 29 2.5 Summary Observations 30 3 TACTICS, TECHNIQUES, MODELS AND SEQUENCING 32 3.1 Introduction 32 3.2 Public Service Pay Tactics, Techniques and Models 33 3.3 Corporatism Model 34 3.4 Salary Indexation Model 36 3.5 Wage Bill and Employment Model 37 3.6 Pressure-Driven cum Patronage Model 37 3.7 Cost of Living cum Egalitarian Model 38 3.8 Job Evaluation and Salary Regrading Model 40 3.9 Market Benchmarking Model 41 3.10 Performance Related Pay Model 41 3.11 Dominant Policy Orientations of the Decision-Making Models 42 3.12 Scanty Evidence of Sequencing Decisions 44 4 PAY REFORM AND POLITICS 47 4.1 Introduction 47 4.2 Theoretical Perspective 49 4.3 Political and Related Variables in Pay Reform 51 4.3.1 Pay Reform as a Problematique in Resource Allocation 51 4.3.2 Political System and Stability Variables 58 4.3.3 Civil Society and Public Service Variables 66 4.4 Economic Variables 70 4.5 Conclusion 72 5 TOWARDS A POLITICALLY RESPONSIVE STRATEGY TO PAY REFORM 74 5.1 Introduction 74 5.2 The shift from political to rational models 74 5.3 The Way Forward 77 6 BENIN 82 6.1 Introduction 82 6.2 The Pay System 84 6.3 Techniques and Tactics 85 6.4 Political Systems and Actors over the years 89 6.5 Past Public Service Reforms and their legacy (1960-1989) 91 6.6 Politics and political process of pay reform (1990-2002) 93 6.7 Politics of pay reform 1990-1997 95 6.8 Politics of pay reform: 1997 to the present 97 6.9 Political steps imperative for pay reform in Benin 98 7 BOTSWANA 100 7.1 Introduction 100 7.2 The Pay System: Structure and Trends 100 7.3 Techniques, Tactics and Sequencing 103 7.3.1 Pay Reform Sequencing and Characteristics 106 7.4 The Political Context 107 7.4.1 The Dominance of the Executive Branch 107 7.4.2 Civil Society and Labour Movement 108 7.4.3 Political Parties 110 7.5 Pay Reform and Politics 112 7.6 Conclusion 115 8 BURKINA FASO 116 8.1 Introduction 116 8.2 Pay Trends and Structure 117 8.3 Tactics, Techniques and Sequencing 119 8.4 Politics 121 8.4.1 Political systems and actors over the years 121 8.4.2 Past public service reforms and their legacy in Burkina Faso 123 8.4.3 The politics and political process of pay reform (1990-2002) 127 8.4.4 Susceptibility of Burkina Faso to political pressure in the public service pay reform process: The political forces 129 8.5 Political steps imperative for pay reform in Burkina Faso 130 9 GHANA 132 9.1 Introduction 132 9.2 Pay Trends and Structure 133 9.3 Politics 136 9.4 The Politics of Disrupted Reform, 1957 - 1981 136 9.4.1 State of the Economy 136 9.4.2 The Policy Context 137 9.4.3 The Basic Features of the Period 141 9.5 The Politics of Sustained Reform, 1982 - 1992 143 9.5.1 Politics of the Reform Programme, 1981-1983 143 9.5.2 Outcomes of the Economic Recovery Programme 144 9.5.3 The Public Sector Pay and Employment Reform, 1986-92 146 9.5.4 Reform Strategies, Tactics and Sequencing 148 9.6 Reform under Democratization, 1993 - 2000 149 9.6.1 The Policy Context 149 9.6.2 Liberalized Politics and Declining Economy 150 9.6.3 The Political Explanation 152 9.7 Reform Prospects in the Post-Rawlings’ Era: 2001 Onwards 154 9.7.1 Economic Position by 2000 154 9.7.2 The Pay Reform Policy Context 156 10 SENEGAL 159 10.1 Introduction 159 10.2 Pay Trends and Structure 160 10.3 Tactics and Techniques 160 10.4 A Political History of Senegal 164 10.5 Party System and Elections 164 10.6 The Politics of Public Service Pay 167 10.7 Conclusion 169 11 TANZANIA 171 11.1 Introduction 171 11.2 Pay Reform in Tanzania 172 11.3 Tanzania’s Politics and Policy Process 176 11.3.1 One-Party Hegemony 176 11.3.2 Egalitarianism 184 11.3.3 Civic Peace, Unity and Stability 186 11.3.4 Bureaucratic Autonomy in Policy Making 186 11.4 The Politics of Pay Reform 188 11.5 Concluding Observations 193 12 UGANDA 194 12.1 Introduction 194 12.2 Pay Trends and Structure 196 12.3 Techniques, Tactics and Sequencing 198 12.3.1 Pay reform and the public service reform 205 12.3.2 Pay as an incentive system 206 12.4 Politics 209 12.4.1 Trade Unionism 211 12.4.2 Political Priority in Resource Allocation 214 12.4.3 The Role of Donors 215 12.4.4 Remuneration Comparison between Civil Servants and Politicians 215 12.4.5 The Pension Scheme 216 12.5 Summary Observations 217 13 ZAMBIA 219 13.1 Introduction 219 13.2 Pay Trends and Structure 219 13.3 Political History of Zambia 221 13.3.1 Party Politics 221 13.3.2 Organized Labor and the State 224 13.3.3 The MMD: Unstable Coalition 227 13.3.4 The Politics of Pay Reform 228 13.3.5 Elections and Public Service Pay Increases 229 13.3.6 Trade Unions and Pay Reform 232 13.4 Concluding Observation 234 14 BIBLIOGRAPHY 235 14.1 Chapter 4 235 14.2 Benin 235 14.3 Botswana 236 14.4 Burkina Faso 237 14.5 Ghana 237 14.6 Tanzania 238 14.7 Others 238 14.8 Uganda 238 14.9 Zambia 239 TABLES, FIGURES AND BOXES TABLES Page Table 1.1: Comparison of Major Demographic, Economic and Fiscal Indicators for 11 the Study Countries: 1990 – 2000 Table 2.1: Comparison (in dollar parity terms) of Top and Bottom Salary Levels for 26 the Study Countries, 1992 – 2001 Table 3.1: Models, Tactics and Techniques 33 Table 3.2: Three Dominant Policy Orientations of Public Service Pay Decision- 42 Making Models Table 4.1: Strength and Orientation of the Main Actors 53 Table 4.2(a): Pay Reform, Ideology and Political Organization 59 Table 4.2(b): Political System and Stability Variables 60 Table 4.3: Civil Society Variables: Strength of Civil Society Generally, Trade 67 Unions, Media and Opposition Parties Specifically Table 4.4: Public Service Variables 69 Table 4.5: Economic Variables, 1990-2000 Averages 71 Table 4.6 Political Institutionalization and Political Competition 72 Table 4.7 Political System and Reform Performance Competition 73 Table 6.1: Benin - A Schedule of Public/Civil service Pay Decisions, 1980 to the 86 Present Table 6.2: Real Wage per Civil Servant (Index 1990 = 100) 88 Table 7.1: Difference between Minimum Wage and Highest Wage in Public Service 103 Table 7.2: Botswana - A Schedule of Major Public/Civil Service Pay Decisions, 1990 104 to Present Table 7.3: BDP Parliamentary Seats 1965-1999 110 TABLES, FIGURES AND BOXES Table 8.1: Salary Structure by Qualifications and Experience 118 Table 8.2: Burkina Faso - A Schedule of Public/Civil Service Pay Decisions, 1989 to 119 Present Table 9.1: Ghana - A Schedule of Public/Civil Service Pay Decisions, 1991 to 135 Present Table 9.2: Changes in Nominal Daily Minimum Wage, 1970s-2001 in Cedis 138 Table 9.3: Reasons for 54 Pay Increase Decisions for the Civil Service and other 154 Public Services, 1992 – 2002 Table 10.1: Senegal – Table of Major Pay Decisions: 1980 – 2003 161 Table 10.2: Senegal: Government Wage Bill and Number of Civil Servants, 1994 – 162 2000 Tabl2 10.3: Electoral Results 165 Table 11.1: Tanzania - A Schedule of Public/Civil Service Pay Decisions, 1989 to 177 Present Table 11.2: The 1995 and 2000 Parliamentary Elections 184 Table 11.3: The 1995 and 2000 Presidential Elections 184 Table 12.1: Tax Revenue Collection, 1988/89 – 1995/96 194 Table 12.2: Uganda - A Schedule of Public/Civil Service Pay Decisions, 1989 to 200 Present Table 13.1: Zambia – Major Public/Civil Service Pay Decisions, 1990 to Present 222 FIGURES Figure 2.1(a): Comparative Trends in Median Salary Levels (in dollar parity terms) for 23 the Study Countries: 1992 – 2001 Figure 2.1(b): Comparative Trends in median salary levels (in dollar parity terms) for the 24 study countries: 1992 – 2001 – (Botswana excluded) Figure 2.2: Comparative Nominal Wage Bill to GDP Ratio (%): 1992 – 2000 28 (excluding Botswana) Figure 2.3: Nominal Salary decompression ratio: 1992 – 2001 30 Figure 3.1: Study Countries’ Choice of Pay Models through Five Political-Economy 46 Epochs, from 1960s to around 2000 Figure 4.1: The Main Actors in the Politics of Resource Mobilization and Allocation 53 Figure 5.1: Institutionalization – Competition 80 Figure 6.1: Benin Salary Levels in 2000 and 2001 88 Figure 7.1: Trends in Top, Median and Bottom Salary Levels in Botswana at Constant 101 Prices, 1990 to Present Figure 8.1: Burkina Faso – Trends in Top, Median and Bottom Salary Levels at 118 Constant Prices, 1992 to the Present Figure 9.1: Trends in Top, Median and Bottom Salary Levels in Ghana at Constant 133 Prices, 1990 to Present - 1995=100 Figure 10.1: Treads in Top, Median and Bottom Salary Levels in Senegal at Constant 161 Prices (1995 = 100) 1992 to 2000 Figure 11.1: Tanzania salary levels at constant prices: 1995=100 174 Figure 12.1: Uganda salary levels at constant prices 1995=100 198 Figure 13.1: Zambia salary levels at constant prices: 1995=100 220 TABLES, FIGURES AND BOXES BOXES Box 1.1: Use of Non-Salary Allowances and Benefits as a Tactic in Public Service 8 Pay Policy Box 3.1: Salary Review Commission Tactic to Public Service Pay Decisions 35 ACKNOWLEDGEMENT To successfully carry out this study, we have benefited greatly from many organizations and individuals.