Civil Servants Salaries Still Stalled

UNCLAS KHARTOUM 000322 SIPDIS SIPDIS E.O. 12958: N/A TAGS: PGOV PINR EFIN ECON ELAB SU SUBJECT: Civil Servants Salaries Still Stalled ¶1. SUMMARY: On February 9, officials from CG Juba met with the Government of Southern Sudan (GoSS) Under Secretary at the Ministry of Finance and Economic SIPDIS Planning, Francis Latiyo. Latiyo discussed the challenges of paying civil servants, developing a reliable payroll foremost among them, and said payments would not begin until April. He also discussed the establishment of a taxation regime, with the Government of National Unity (GNU) collecting all customs and tariffs and the GoSS collecting all other taxes. However, Latiyo said that the Ministry has been so busy establishing itself -- he had only been on the job two weeks -- that it has not focused on taxes or tax collection. End Summary. -------------- The Volunteer Civil Service -------------- ¶2. Despite donor assistance to the Government in establishing civil service payrolls and paying civil servants, Latiyo said that much work remains. He explained that the GoSS still does not know how many civil servants it has, and it is continuing to collect rosters from all ten southern states. Once that is done, a committee must meet to go over the roles of the two parallel civil services -- the SPLM civil servants and the employees of the North's old Government Coordinating Council -- then review their qualifications, and decide whom to keep. These committees are chaired by the under secretaries for each ministry, who were only appointed SIPDIS recently. ¶3. Although the GoSS has the money to pay these employees, which include teachers working without payment since the beginning of the school year, Latiyo made clear that they cannot begin issuing checks until they know who to pay. When pressed, Latiyo admitted that April is the earliest the GoSS would be ready. In the meantime, government employees continue to work for incentives, such as free housing in the case of some ministry employees, and with the promise of future pay and some back pay. It is uncertain how extensive back pay would be. -------------- Tax Regime in Transition -------------- ¶4. Latiyo said that ministry officials were still working with the GNU) to determine the exact taxing authority for the GoSS. His understanding was that tariffs and customs duties -- which he noted were the SPLM's primary source of income during the war -- would be national functions under the GNU. He expected that all purely domestic taxes, such as income, property and business taxes, would be under the authority of the GoSS and its associated states, counties, payams, and bomas. Latiyo admitted that the ministry had been so focused on establishing itself and making it work that officials have not had a chance to develop a taxation structure or even decide precisely what to tax. Because of this, the GoSS was currently not collecting any taxes, although the GNU continued to collect the tariffs and customs duties at the border. ¶5. Latiyo reiterated that the GoSS is dedicated to attracting foreign investors, and to making the South a good place to do business. He said that businesses would be able to operate in the south without all the prohibitive restrictions in the North; however, he indicated that the ministry had not discussed any additional incentives, such as tax breaks or low-cost land leases. Again, this was due to its focus on establishing itself. ¶6. Bio Note: Latiyo is a Baka from Yei. During the war, he was a soldier for the SPLA and also worked for their finance ministry, collecting tariffs and customs duties in Yei. HUME