13 Jul 2007

Marshalls budget strained by public sector growth

2:14 pm on 13 July 2007

The chief planner for the Marshall Islands government says the increase in its employee numbers is putting strain on the budget.

A report issued by the government shows that as of March 2007 the number of people working for it had increased by nearly 50 percent since 1999.

Carl Hacker says that kind of employment growth, partly attributable to adjustments under the new Compact of Free Association with the US, is not sustainable.

"Like I said, some of it is just the result of the way the Compact has reorganised somethings particularly for health and education. But on the other hand too, it's almost like we've filled some of the positions that we did away with back in the 1990s under the reform programme."

Carl Hacker says the concern is that the Marshalls doesn't currently have economic growth that's leading to an increase in the tax base to allow this rate of growth in public employment.