GREAT BAY, St. Maarten (Thursday, September 13, 2012) -The Prime Minister of St. Maarten the Honorable Sarah Wescot-Williams met with the GOA, the Consultation Body for matters pertaining to Government Personnel, on Wednesday with regard to the Cost of Living Index. “The Indexation for 2010 was finally paid out earlier this year and both the Minister of Finance and I indicated that it is necessary that we have discussions regarding this system of indexation with the representatives of the workers of Government in the GOA." 

“We looked forward to having that discussion, particularly considering how the indexation that is now applied to all salaries of Government, is governed by a Government Policy that states that the indexation will be paid out depending on the financial possibilities of the Government. Therefore I think it extremely important that we have those discussions ahead of time so that we don't end up in a situation such as we had with the payment of the last indexation that was not taken up in the budget in first instance”, commented the Prime Minister.

The first meeting with the GOA on the topic of the Cost of Living Adjustment took place at the AC Wathey Hall on Wednesday afternoon. The meeting included numerous union representatives, both the official union members of the GOA and other unions, representing government personnel, who are not (yet) members. 

"I have indicated on several occasions that I do not want the matter to go the same way it went with the last pay-out. The matter of the indexation of salaries is part of a Government’s policy and Government can and should make this decision on a yearly basis given the financial constraints or possibilities, if there are such for that payment."

"The matter of adjusting salaries in accordance with the inflation and increase in prices is a matter that Government wants to look at not only in terms of indexation of salaries, but also overall the cost of living for the People of St. Maarten; not only civil servants but all persons are affected by the increases in the cost of living. Therefore Government wants to approach the cost of living from a more comprehensive perspective,” stated the Prime Minister.

During the meeting with the GOA on the matter of the Indexation of Salaries for Civil Servants all representatives had the opportunity to table their initial reactions. “These are financially challenging times, yet a time that there is so much still to be done and improved,” continued the PM.

 The Prime Minister commented in her remarks that the system which Government currently uses for indexation would lead to serious financial consequences, and would be untenable. This is related to the fact that the way the indexation is currently calculated; the cost of living increase is granted to compensate for the full cost of living index every year and every year it becomes a structural part of the salaries, which means that salaries are adjusted on top of the indexation of the year before; “This has consequences for pensions and all other aspects that relate to the base salaries. The bottom line is that even if we were to find ourselves in better economic times, we cannot meet those structural adjustments of public salaries.   We need to therefore talk about the future of the indexation as part of the broader discussion of public servants entitlements, and I expect the members of the GOA to put their heads together and deliberate these broader issues and come up with proposals", said the Prime Minister.

The PM concluded by stating that at first glance this might be a somber picture but that she believes that Government in consultation with the GOA and other stakeholders has the opportunity to examine what the possibilities are with regard to the high cost of living in general. 

 The meetings of the GOA on the topic will continue in the near future on the basis of an initial draft discussion paper.