Doctors withdraw emergency services over allowances

Doctors in Ghana’s public health facilities withdrew emergency services on Friday to back their demand for improved allowances and other non-salary benefits, union leaders said in a move that presents a litmus test for the government’s fiscal sustainability.

Ghana, which exports cocoa, oil and gold, is under a three-year aid program with the International Monetary Fund to stabilize its economy, dogged by slowing growth, widening debt and a stubbornly high budget deficit partly attributed to a heavy public wage bill in the last election year.

Beginning Friday, some 2,000 doctors would only attend to in-patients, Kwabena Opoku Adusei, president of the Ghana Medical Association (GMA) said. The action would mostly affect the poor and underprivileged who depend solely on public health care.

Adusei said doctors would embark on a full strike on Aug. 14 if negotiations with the government failed to yield results.

“(We’re) still negotiating,” Adusei said in a text message to Reuters.

The West African nation is also grappling with prolonged electricity outages which have crippled industries, leading to stunted economic growth and angered voters ahead of elections next year.

Apart from the doctors, university teachers have also announced withdrawal of services over delays in the payment of their book and research allowances. Other public sector workers, including psychiatric nurses, have also threatened to strike.

Finance Minister Seth Terkper said the government would only offer to public sector workers what is “manageable” under the current fiscal constraints so as not to jeopardize the fiscal stabilization program under the IMF deal.

“We’re not about to just give up all the efforts and energy we’ve put in place over the last two-and-half years to restore fiscal stability,” Terkper said. “So we’ll put all the cards on the table and let them know what is possible now and what we can accommodate next year.”

Ghana spends 50-55 percent of its tax revenues on public sector wages and compensation, down from 70 percent three years ago and analysts say any rise in the wage bill could derail medium term macro targets.

“The economy is currently on a tight rope and any additional pressure on the budget, as we’re seeing now from the workers’ demand, is bad news. On the other hand, the political repercussions are obvious,” economist Frank Dzoko said.

In a revised budget to Parliament last month, Terkper widened the government’s 2015 budget deficit target to 7.3 percent of gross domestic product (GDP) from 6.5 percent previously and cut economic growth estimate to 3.5 percent to 3.9 percent.