The implementation of the Single Wage Table (TSU) will continue to muddle public accounts, particularly with regard to the Mozambican government's efforts and need to bring down the current percentage of the wage bill in relation to the Gross Domestic Product (GDP)..

This is the finding of the Ministry of Economy and Finance (MEF) in its Fiscal Risks for 2025 report, quoted by Savannah newspaper.

The idea, in line with the recommendations of the International Monetary Fund (IMF), is to find ways to ensure that the wage bill in the Mozambican state apparatus reaches at least 13.8% next year.

According to the MEF report, a significant portion of the resources generated by the economy will continue to be absorbed by expenditure on salaries and wages. And the situation, according to the Ministry of Economy and Finance, will continue to be largely influenced by the implementation of the TSU, introduced two years ago by the government of Filipe Nyusi.

"With the wage bill representing, on average, 14.5% of GDP between 2021 and 2023 and an average deviation of 21.3 billion meticais in relation to the initial appropriations planned, the management of the wage bill has been a major concern for public managers, so there is a need to find mechanisms for its sustainability," says the document, pointing to the increasingly limited capacity to move forward with investments in so-called priority areas, including social services such as water supply, health and education.

It should be remembered that in recent years, the government has been trying to use various strategies to reduce the wage bill. It has even been succeeding, but the reduction is taking place at a very slow pace, bearing in mind that the IMF has long wanted a figure of 13.8% to be reached by 2025. In 2023, the weight of the wage bill fell to 15.1%, after 16.1% the previous year.

Also in this regard, the pessimistic scenario drawn up by the Ministry of Economy and Finance foresees an estimated additional expenditure of 31 billion meticais in 2025.

Specifically, this was associated with and explained by the sensitivity of the wage bill to slower nominal GDP growth. In fact, "the medium-term outlook for the wage bill as a proportion of GDP suggests a slower reduction in the pessimistic scenario (13.6% on average) compared to the base scenario (12.3% on average), with a converging trend in 2027".

(Photo DR)