Economic Research | Lebanon This Week | Lebanon This Week 563 | Compensation of public-sector personnel up 26% in first half of 2018, absorbs 35.5% of fiscal spending | Lebanon | Byblos Bank

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Byblos Bank

Lebanon This Week 563

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Compensation of public-sector personnel up 26% in first half of 2018, absorbs 35.5% of fiscal spending

Figures issued by the Ministry of Finance show that the compensation of public-sector personnel totaled $3.2bn in the first half of 2018, constituting an increase of 26.3% from $2.5bn in the same period of 2017. The double-digit increase is due to the new public-sector salary scale that was enacted by the Lebanese Parliament in July 2017. Salaries, wages and related benefits accounted for 64.8% of the total in the first half of 2018, followed by retirement benefits (22.8%), end-of-service indemnities (7.8%), and transfers to public institutions to cover salaries (4.6%). The compensation of public-sector personnel represented the largest component of budgetary current primary spending and accounted for 67.6% of such expenditures in the covered period compared to 69.3% in the first half of 2017. It absorbed 35.5% of fiscal spending in the first half of 2018 relative to 36.2% in the first half of 2017. 

Salaries, wages & related benefits paid to public-sector employees reached $2.1bn in the first half of 2018, constituting an increase of 26.2% from $1.6bn in the same period of 2017. This category includes basic salaries, employment benefits, allowances, contributions to civil servants' cooperatives, as well as contributions to other mutual funds providing health insurance for specific categories of civil servants, mainly civil and religious judges, and employees at the Parliament. In addition, retirement benefits grew by 17% to $726.4m in the first half of 2018, while end-of-service indemnities rose by 95% to $248.1m, and transfers to public institutions to cover salaries expanded by 5.9% to $145.9m in the covered period.
 
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