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Gov’t talks options to slash costs while keeping workers

OMB Executive Director Carlos Rivas

OMB Executive Director Carlos Rivas

Gov. Alejandro García-Padilla’s administration is contemplating a number of austerity measures to scale back government expenses, including proposing an across-the-board $600 Christmas bonus for all public employees and eliminating payments of excess or unused sick days.

During a sit-down with members of the media, Office of Management and Budget Executive Director Carlos Rivas outlined the strategy that would save the government $1.35 billion, while pushing it toward a “more efficient” operation. The administration is proposing a $9.64 billion budget.

Among the cutbacks are freezing automatic increases in the budget formulas for municipalities, the Judiciary branch and the University of Puerto Rico that represent $132 million.

The government is also looking to reduce the budgets for all government branches and autonomous operations by the same 8 percent that will be applied to cut back general budget expenses. The administration also proposes to reduce special assignments for programs or entities that are not considered “priority.”

On the human resources side, Rivas said the administration is looking to sit down with labor groups to renegotiate collective bargaining agreements to find savings per employee.

“Labor groups have already expressed their disposition to talk. Other jurisdictions in similar situations have managed to get labor groups to sit down with the government and start a dialogue because they all see the same reality. We have to find a way to reach the numbers we need,” Rivas said.

Meanwhile, Rivas said the administration will propose establishing a uniform $600 Christmas bonus for all public employees — a measure that would shave off $75 million in expenses, but which could face opposition from labor groups whose members receive significantly more than that at the end of the year.

The proposed budget also calls for reducing the government’s payroll by eliminating excess sick pay, which would save $19 million, reducing positions of trust by 10 percent — which would save $10 million — and limiting incremental individual wage benefits.

The austerity plan does not contemplate eliminating public-sector jobs, Rivas said.

Along with the proposed budget, the García-Padilla administration is also submitting to the Legislature a bill to declare a fiscal emergency, which would pave the way for the cutbacks.

Author Details
Author Details
Business reporter with 29 years of experience writing for weekly and daily newspapers, as well as trade publications in Puerto Rico. My list of former employers includes Caribbean Business, The San Juan Star, and the Puerto Rico Daily Sun, among others. My areas of expertise include telecommunications, technology, retail, agriculture, tourism, banking and most other segments of Puerto Rico’s economy.

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