Serbia - Right-Sizing the Government Wage Bill

World Bank

dc.creator	World Bank
dc.date	2012-03-19T10:24:52Z
dc.date	2012-03-19T10:24:52Z
dc.date	2010-10-12
dc.date.accessioned	2023-02-17T20:44:05Z
dc.date.available	2023-02-17T20:44:05Z
dc.identifier	http://www-wds.worldbank.org/external/default/main?menuPK=64187510&pagePK=64193027&piPK=64187937&theSitePK=523679&menuPK=64187510&searchMenuPK=64187283&siteName=WDS&entityID=000334955_20101104023105
dc.identifier	http://hdl.handle.net/10986/2923
dc.identifier.uri	http://localhost:8080/xmlui/handle/CUHPOERS/243278
dc.description	Serbia's public sector wage bill constitutes a significant share of total government expenditure. At present, it is significantly higher than in most neighboring European Union (EU) member countries. This is largely due to higher average levels of compensation, rather than higher levels of staffing. While wage spending has fallen recently this is not the occasion to be sanguine about the Government's wage and employment policies. There are two reasons. First, continuing control over the wage bill is a key part of the Government's overall deficit reduction strategy. Given the Government's reluctance to raise taxes and the difficulty it confronts in reducing other major categories of expenditures (particularly pensions), restraining the wage bill is critical to fiscal sustainability. In connection with its standby arrangement with the International Monetary Fund (IMF), the government is committed to enacting fiscal responsibility legislation which would cap wage bill spending at eight percent of gross domestic product (GDP) over the medium term. To date, the Government has been relying on blunt instruments to achieve this target; most importantly a freeze on nominal wages and a partial freeze on the creation of new positions, both introduced in 2009. As the current recession eases, pressures to increase wages are mounting. The wage freeze is becoming politically unsustainable. More nuanced methods of restraining the wage bill are required. Second, over the longer term, the present policy of continuous wage and position freezes would undermine the quality of public administration. Persistent wage freezes would make it difficult to attract and retain competent staff. Persistent position freezes would lock in existing patterns of over- and under staffing. On the other hand, a reversion to the former system of ad hoc adjustments in staffing and wages could set the stage for unsustainable wage bill growth in the future. Structural reforms are therefore required.
dc.language	English
dc.publisher	World Bank
dc.rights	CC BY 3.0 IGO
dc.rights	http://creativecommons.org/licenses/by/3.0/igo/
dc.rights	World Bank
dc.subject	ACCOUNTABILITY
dc.subject	ACCOUNTING
dc.subject	ADVERSE SELECTION
dc.subject	ATTRITION
dc.subject	AVERAGE WAGE
dc.subject	AVERAGE WAGES
dc.subject	BUDGET EXECUTION
dc.subject	BUDGET PROCESS
dc.subject	CIVIL SERVANT
dc.subject	CIVIL SERVANTS
dc.subject	CLERKS
dc.subject	COLLECTIVE BARGAINING
dc.subject	COMPETITIVE PRESSURES
dc.subject	CRIME
dc.subject	DISMISSAL
dc.subject	EARNING
dc.subject	ECONOMIC CONDITIONS
dc.subject	EMPLOYEE
dc.subject	EMPLOYER CONTRIBUTIONS
dc.subject	EMPLOYMENT POLICIES
dc.subject	EMPLOYMENT SERVICES
dc.subject	EQUAL PAY
dc.subject	EQUALIZATION
dc.subject	FEDERAL GOVERNMENT
dc.subject	FINANCIAL INCENTIVES
dc.subject	FISCAL RESPONSIBILITY
dc.subject	GOVERNMENT EMPLOYEES
dc.subject	GOVERNMENT OFFICIALS
dc.subject	GOVERNMENT SPENDING
dc.subject	GROSS WAGES
dc.subject	HEALTH INSURANCE
dc.subject	HOUSING
dc.subject	HUMAN RESOURCE
dc.subject	HUMAN RESOURCES
dc.subject	INCOME
dc.subject	INCOME TAXES
dc.subject	INFLATION
dc.subject	INFORMAL SECTOR
dc.subject	INSURANCE
dc.subject	JOB SECURITY
dc.subject	JOBS
dc.subject	JUDICIARY
dc.subject	LABOR FORCE
dc.subject	LABOR LAW
dc.subject	LABOR MARKET
dc.subject	LABOR RELATIONS
dc.subject	LAWS
dc.subject	LAWYERS
dc.subject	LOCAL BUDGETS
dc.subject	LOCAL FINANCE
dc.subject	LOCAL GOVERNMENT
dc.subject	LOCAL GOVERNMENT EMPLOYEES
dc.subject	LOCAL GOVERNMENTS
dc.subject	LOCAL LEVEL
dc.subject	MINIMUM WAGE
dc.subject	MINISTER
dc.subject	MINISTRIES OF FINANCE
dc.subject	MUNICIPAL COUNCILS
dc.subject	MUNICIPAL GOVERNMENTS
dc.subject	MUNICIPALITIES
dc.subject	MUNICIPALITY
dc.subject	NOMINAL WAGES
dc.subject	OCCUPATION
dc.subject	OCCUPATIONS
dc.subject	OUTPUTS
dc.subject	PAYROLL TAX
dc.subject	POLICE
dc.subject	POLITICIANS
dc.subject	POVERTY REDUCTION
dc.subject	PRIMARY LEVEL
dc.subject	PRIMARY SCHOOL
dc.subject	PRIVATE EMPLOYMENT
dc.subject	PRIVATE FIRMS
dc.subject	PRIVATE SECTOR
dc.subject	PRIVATE SECTOR WAGES
dc.subject	PRIVATE SECTORS
dc.subject	PRIVATIZATION
dc.subject	PRODUCTIVITY
dc.subject	PROVISIONS
dc.subject	PUBLIC
dc.subject	PUBLIC ADMINISTRATION
dc.subject	PUBLIC EDUCATION
dc.subject	PUBLIC EMPLOYEES
dc.subject	PUBLIC EMPLOYMENT
dc.subject	PUBLIC ENTERPRISES
dc.subject	PUBLIC EXPENDITURE
dc.subject	PUBLIC EXPENDITURE REVIEW
dc.subject	PUBLIC SECTOR
dc.subject	PUBLIC SECTOR COMPENSATION
dc.subject	PUBLIC SECTOR DOWNSIZING
dc.subject	PUBLIC SECTOR EMPLOYMENT
dc.subject	PUBLIC SECTOR HUMAN RESOURCE
dc.subject	PUBLIC SECTOR HUMAN RESOURCE MANAGEMENT
dc.subject	PUBLIC SECTOR INSTITUTIONS
dc.subject	PUBLIC SECTOR STAFF
dc.subject	PUBLIC SECTOR UNIONS
dc.subject	PUBLIC SECTOR WAGE
dc.subject	PUBLIC SECTOR WAGE BILL
dc.subject	PUBLIC SECTOR WAGES
dc.subject	PUBLIC SECTOR WORKER
dc.subject	PUBLIC SECTOR WORKERS
dc.subject	PUBLIC SERVICE
dc.subject	PUBLIC SERVICE EMPLOYEES
dc.subject	PUBLIC SERVICES
dc.subject	PUBLIC SPENDING
dc.subject	REAL WAGE
dc.subject	REAL WAGES
dc.subject	RETIREMENT
dc.subject	SAVINGS
dc.subject	SELF EMPLOYMENT
dc.subject	SERVANTS
dc.subject	SERVICE SECTOR
dc.subject	SEVERANCE PAYMENT
dc.subject	SEVERANCE PAYMENTS
dc.subject	STRUCTURAL REFORMS
dc.subject	TAX
dc.subject	TEMPORARY WORKERS
dc.subject	TOTAL EMPLOYMENT
dc.subject	TOTAL WAGE
dc.subject	TRADE UNIONS
dc.subject	TRANSPARENCY
dc.subject	TREASURY
dc.subject	UNEMPLOYED
dc.subject	URBAN AREAS
dc.subject	VOTERS
dc.subject	WAGE ADJUSTMENT
dc.subject	WAGE BILL
dc.subject	WAGE DATA
dc.subject	WAGE DETERMINATION
dc.subject	WAGE INCREASES
dc.subject	WAGE LEVELS
dc.subject	WAGE NEGOTIATION
dc.subject	WAGE PREMIUM
dc.subject	WAGE STRUCTURE
dc.subject	WORK FORCE
dc.subject	WORKERS
dc.title	Serbia - Right-Sizing the Government Wage Bill
dc.type	Economic & Sector Work :: Public Expenditure Review
dc.coverage	Europe and Central Asia
dc.coverage	Europe
dc.coverage	Serbia