Pub­lic ser­vants are in­creas­ing­ly ques­tion­ing how much they will ac­tu­al­ly gain from the 10 per cent salary ad­just­ment grant­ed in De­cem­ber 2025, as high­er Na­tion­al In­sur­ance con­tri­bu­tions, tax pay­ments and a pro­posed 40-60 struc­ture for back­pay are ex­pect­ed to re­duce the set­tle­ment’s val­ue.

Two work­ers in the Pub­lic Ser­vices As­so­ci­a­tion (PSA) and two in the Na­tion­al Union of Gov­ern­ment and Fed­er­at­ed Work­ers (NUGFW), spoke to Busi­ness Guardian on con­di­tion that their names and iden­ti­fy­ing de­tails were with­held be­cause they are not au­tho­rised to speak pub­licly, said work­ers were grow­ing frus­trat­ed.

Work­ers feel the squeeze

One PSA work­er said high­er Na­tion­al In­sur­ance (NIS) con­tri­bu­tions had al­ready re­duced the ben­e­fit of the salary ad­just­ment and that fur­ther de­duc­tions through in­come tax could leave some em­ploy­ees feel­ing they had re­turned close to their pre-in­crease take-home pay.

An­oth­er PSA work­er said the pro­posed back­pay arrange­ment was al­so caus­ing con­cern be­cause 60 per cent of the set­tle­ment would be de­liv­ered through non-cash ben­e­fits, leav­ing on­ly 40 per cent as cash pay­ment.

The work­er ques­tioned how wide­ly some of the pro­posed non-cash ben­e­fits would be used, par­tic­u­lar­ly mort­gage-re­lat­ed con­ces­sions and tax ex­emp­tions for ve­hi­cles.

For pub­lic ser­vants who do not own homes or ve­hi­cles, the work­er said, those ben­e­fits would have lit­tle im­me­di­ate val­ue. The work­er al­so ques­tioned whether gro­cery-re­lat­ed ben­e­fits would pro­vide mean­ing­ful re­lief.

The Chief Per­son­nel Of­fi­cer Ret’d Com­man­der Dr Daryl Din­di­al, dur­ing his ne­go­ti­a­tions with the PSA ear­li­er this year, in­clud­ed non-cash op­tions, in­clud­ing off­sets for state mort­gage and rental oblig­a­tions through the Hous­ing De­vel­op­ment Cor­po­ra­tion and the Trinidad and To­ba­go Mort­gage Bank, out­stand­ing tax li­a­bil­i­ties, tu­ition fees at state in­sti­tu­tions, med­ical cov­er­age, tax con­ces­sions on new and roll-on/roll-off ve­hi­cles and the con­ver­sion of cash en­ti­tle­ments in­to leave.

The ne­go­ti­a­tions in­volved salary pe­ri­ods cov­er­ing 2014-2016 and 2017-2019 and have be­come a ma­jor point of con­tention be­tween the union and the State.

One NUGFW work­er said that if a work­er was en­ti­tled to $100,000 in back pay, on­ly $40,000 would be paid in cash un­der the pro­posed arrange­ment.

The work­er said that af­ter tax­es were ap­plied to the cash pay­ments over the rel­e­vant fi­nan­cial years, the amount reach­ing work­ers could be con­sid­er­ably low­er than the head­line fig­ure.

An­oth­er NUGFW work­er said dai­ly-rat­ed work­ers were par­tic­u­lar­ly im­por­tant to the dis­cus­sion be­cause the wage ad­just­ment and back­pay com­mit­ments ex­tend be­yond tra­di­tion­al month­ly-paid pub­lic ser­vants.

The work­er said the fi­nan­cial im­pact had to be as­sessed across the wider pub­lic sec­tor.

The con­cerns come as de­bate in­ten­si­fies over the Gov­ern­ment’s abil­i­ty to fi­nance the wage set­tle­ment and back­pay.

NUFGW pres­i­dent gen­er­al Christo­pher Street was al­so un­reach­able at the time.

$25b ar­rears warn­ing

For­mer fi­nance min­is­ter Colm Im­bert has warned that the cost could be­come a multi­bil­lion-dol­lar bur­den on the State.

Speak­ing at an Op­po­si­tion news con­fer­ence last week, Im­bert claimed that ex­tend­ing a 10 per cent wage in­crease across the wider state sec­tor could push the ar­rears bill be­yond $25 bil­lion, while adding about $1.5 bil­lion an­nu­al­ly to re­cur­rent ex­pen­di­ture.

He al­so point­ed to a $2.6 bil­lion back-pay li­a­bil­i­ty aris­ing from the 10 per cent in­crease for dai­ly-rat­ed work­ers alone, with an ad­di­tion­al $252 mil­lion a year in wages.

Im­bert ar­gued that the ex­pen­di­ture had not been pro­vid­ed for in the orig­i­nal 2026 bud­get or the mid-year re­view.

He al­so said the Gov­ern­ment had in­struct­ed lo­cal gov­ern­ment cor­po­ra­tions to be­gin pay­ing the in­creased salaries by Sep­tem­ber, de­spite the cor­po­ra­tions lack­ing the re­sources to do so.

For work­ers, how­ev­er, the is­sue is not sim­ply whether the Gov­ern­ment can af­ford the set­tle­ment. They are al­so ques­tion­ing how much of the mon­ey will ul­ti­mate­ly reach their pock­ets and whether the pro­posed struc­ture re­flects their im­me­di­ate needs.

One PSA work­er said work­ers had be­come re­luc­tant to speak pub­licly be­cause of con­cerns about be­ing iden­ti­fied, even as many were pri­vate­ly dis­cussing the fi­nan­cial im­pli­ca­tions of the set­tle­ment.

The work­er said the 10 per cent in­crease had been erod­ed by NIS and oth­er de­duc­tions, while the back­pay pro­pos­al made the ex­pect­ed ben­e­fit more dif­fi­cult to cal­cu­late.

The work­er said some em­ploy­ees did not dis­miss Im­bert’s fi­nan­cial con­cerns as po­lit­i­cal rhetoric.

The work­er not­ed that pub­lic ser­vants had a di­rect in­ter­est in the Gov­ern­ment’s abil­i­ty to meet its oblig­a­tions be­cause de­lays or fi­nan­cial strain could even­tu­al­ly af­fect salary pay­ments and the de­liv­ery of pub­lic ser­vices.

That con­cern was echoed by an­oth­er work­er, who point­ed to re­ports of pres­sure with­in pub­lic in­sti­tu­tions and the need for ad­e­quate staffing and re­sources.

The CPO told Busi­ness Guardian on Tues­day that col­lec­tive agree­ments cov­er­ing the 10 per cent in­crease had al­ready been signed for NUGFW and the rel­e­vant PSA bar­gain­ing unit.

He said the NUGFW agree­ment cov­ers cen­tral gov­ern­ment, in­clud­ing min­istries and de­part­ments, while the PSA agree­ment cov­ers the civ­il ser­vice, statu­to­ry au­thor­i­ties and the To­ba­go House of As­sem­bly (THA).

The CPO clar­i­fied that the Gov­ern­ment’s in­struc­tions to pro­ceed with the 10 per cent in­crease ap­plied to that PSA group and did not ex­tend to oth­er PSA bar­gain­ing units.

He  con­firmed that the Gov­ern­ment’s of­fer is struc­tured on a 40 per cent cash and 60 per cent non-cash ba­sis.

The out­stand­ing is­sue is how ar­rears will be treat­ed for the PSA group.

When con­tact­ed for com­ment, PSA pres­i­dent Fe­l­isha Thomas re­ject­ed for­mer fi­nance min­is­ter Colm Im­bert’s claim that the Gov­ern­ment has cre­at­ed a multi­bil­lion-dol­lar pub­lic-sec­tor wage and back­pay bur­den, ar­gu­ing that the debt ac­cu­mu­lat­ed un­der the pre­vi­ous PNM ad­min­is­tra­tion.

Re­spond­ing to Im­bert’s crit­i­cism of the Gov­ern­ment’s man­age­ment of pub­lic fi­nances and pub­lic-sec­tor wage ne­go­ti­a­tions, Thomas said the out­stand­ing pay­ments to work­ers were the re­sult of the pre­vi­ous ad­min­is­tra­tion’s fail­ure to set­tle ne­go­ti­a­tions.

“The so-called ‘bur­den’ was cre­at­ed by the PNM Gov­ern­ment that held of­fice for two con­sec­u­tive terms and failed to set­tle ne­go­ti­a­tions,” Thomas stressed.

She said the PSA had sub­mit­ted pro­pos­als for the 2014-2016 pe­ri­od in Oc­to­ber 2015 but claimed the then Gov­ern­ment sub­se­quent­ly re­fused to re­turn to the ne­go­ti­at­ing ta­ble.

“They re­fused to come to the ta­ble since Oc­to­ber 2015 when the PSA sub­mit­ted pro­pos­als for the pe­ri­od 2014-2016 and al­lowed ar­rears to ac­cu­mu­late in­def­i­nite­ly,” she said.

Thomas said the ac­cu­mu­la­tion of ar­rears was in­evitable when out­stand­ing oblig­a­tions were not set­tled.

“Any bill that is not paid does not sim­ply dis­ap­pear; it con­tin­ues to ac­cu­mu­late,” she said.

She said the cur­rent ad­min­is­tra­tion had in­stead tak­en the po­si­tion that out­stand­ing sums owed to pub­lic-sec­tor work­ers should be paid.

“What this Gov­ern­ment has done is adopt a po­si­tion that what is owed to work­ers must be set­tled, and that is what they are work­ing to­wards, set­tling yet an­oth­er debt left be­hind by the PNM,” Thomas lament­ed.

Thomas al­so took is­sue with Im­bert’s de­scrip­tion of the wage and back­pay oblig­a­tions as a bur­den, ar­gu­ing that pay­ments owed to work­ers should not be char­ac­terised in that way.

Econ­o­mists urge

wider de­bate

Econ­o­mist Dr Vanus James said the wider is­sue was whether T&T had a frame­work through which ma­jor ex­pen­di­ture com­mit­ments could be dis­cussed na­tion­al­ly.

James said such de­ci­sions should not be con­fined to ne­go­ti­a­tions be­tween Gov­ern­ment and unions.

“First of all, when mak­ing these com­mit­ments, you need a prop­er frame­work in which the whole coun­try can par­tic­i­pate in the con­ver­sa­tion,” James told Busi­ness Guardian.

He said the coun­try need­ed to con­sid­er whether it had the eco­nom­ic ca­pac­i­ty to sus­tain high­er re­cur­rent ex­pen­di­ture.

James point­ed out that the ques­tion was not whether work­ers should re­ceive high­er wages, but whether the econ­o­my was be­ing de­vel­oped suf­fi­cient­ly to gen­er­ate the in­come need­ed to pay for those com­mit­ments over the long term.

“If we’re go­ing to get the mon­ey from oil and gas, then you have to have a pro­gramme to en­sure oil and gas doesn’t col­lapse every Mon­day morn­ing and put you in a big bud­get hole,” he said.

He said di­ver­si­fi­ca­tion re­mained crit­i­cal be­cause oil and gas rev­enues were vul­ner­a­ble to changes in pro­duc­tion and in­ter­na­tion­al con­di­tions.

James ar­gued that high­er wages could be treat­ed as an in­vest­ment, but that in­vest­ment had to be linked to ac­tiv­i­ties ca­pa­ble of in­creas­ing the coun­try’s long-term earn­ing ca­pac­i­ty.

He point­ed to ed­u­ca­tion, health­care and fi­nan­cial ser­vices as ar­eas where T&T could de­vel­op ca­pa­bil­i­ties that gen­er­ate in­come be­yond the do­mes­tic mar­ket.

“You’ve got to build an econ­o­my that re­lies on the tal­ent and the learn­ing that all our peo­ple are do­ing all the time,” he said.

James said bor­row­ing to cov­er re­cur­ring ex­pen­di­ture with­out si­mul­ta­ne­ous­ly ex­pand­ing the econ­o­my’s ca­pac­i­ty to gen­er­ate rev­enue would leave the coun­try ex­posed to fu­ture deficits.

Bar­ba­di­an econ­o­mist Je­re­my Stephen raised a sep­a­rate con­cern: the im­pact high­er gov­ern­ment ex­pen­di­ture could have on T&T’s for­eign-ex­change po­si­tion.

Stephen said small, re­source-rich economies faced par­tic­u­lar dif­fi­cul­ties when oil and gas un­der­per­formed and sta­bil­i­sa­tion funds were not suf­fi­cient­ly fund­ed.

He said the Gov­ern­ment would ul­ti­mate­ly have to fi­nance high­er re­cur­rent ex­pen­di­ture through some com­bi­na­tion of stronger rev­enues, bor­row­ing or tax­a­tion.

With­out stronger oil and gas per­for­mance or suf­fi­cient pub­lic in­vest­ment ca­pa­ble of gen­er­at­ing re­turns, Stephen ex­plained a sub­stan­tial in­crease in wages could place ad­di­tion­al pres­sure on the coun­try’s for­eign-ex­change po­si­tion.