Sri Lanka Treasury is now having an up hill task to find additional revenue to pay public sector salaries as 1.5 million employees going to receive a wage hike shortly, official sources said.
The country’s recurrent expenditure on public sector salaries and pensions will account for 45 percent of the government’s revenue this year.
The 2019 budget has allocated Rs.40 billion to pay the increased amount between Rs. 2500 and Rs. 10,000 from the lowest to higher grades of public sector employees with effect from January as the last tranche of Rs.10,000 salary hike granted in 2016.
Additional revenue is needed to meet the expenditure in paying Rs. 2500 allowance granted to public sector from 2019 budget starting July 1, an official said adding that it has become extreme difficult to find money for this purpose .
The Government has to pay Rs.1 trillion of Rs.1.5 trillion recurrent expenditure this year as public sector salaries and pensions.
The Treasury has to manage the annual state expenditure of Rs.4.5 with the targeted revenue of Rs. 2.4 billion; he said pointing out the payment of public sector salaries will become a daunting task within the next three months.
The government expenditure on public sector salaries is to further increase as plans are underway to recruit more unemployed graduates in addition to 20,000 unemployed graduates already recruited to the state sector.