Wage/Salary Accounting after Redenomination

This new monetary policy labelled redenomination is only going to reward banks for what they have not earned. The banks have continuously been blamed by the employers association and the Association of Ghana Industries (AGI) for high interest rates that has be riddled the private sector and stifled investment.

The financial sector reform saw the mushrooming of many new banks, non-bank financial institutions and the expansion of existing banks into new areas. In view of the competition though, benefits were extended just to the new depositors, clients or customers in the form of attractive packages like low initial deposits. Once you became registered the harsh realities of the status quo sets in generally, in the form of bad client services prevalent at most banks.

The banks are favoured in the scheme of things because once you are registered it becomes even so difficult for the worker to exit the banks. Especially, so when salaries begin to go through to banks long after due to government bureaucracy. It takes not less than between three to six months for a first pay of a public sector worker a teacher, a nurse and so on to be received and even worse for those in the rural areas.

Although, the minimum wage has been on the rise over the years, selective public sector salary increases has aggravated the "wage wars" of labour groups in 2006 i.e., NAGRAT. Once an employee starts working it becomes difficult to find time to follow-up to the accounts office every now and then to effect changes. It was reported that teacher trainees did not receive their salaries for 17 months at a district in the country (02/23/2007, Ghanaweb).

There are many things in Ghana that could have been done just by telephone even by email and through internet access to company website. But this is not the case just like the case of changing one's bank if you are a public sector worker.

Because historically the banking sector was not as diversified in the past as it is today. So that the norm almost was that most public sector workers were paid through the public sector banks; ADB, GCB, NIB, SG-SSB and the known traditional banks of the Barclays, ECOBank, Merchant Bank and Standard Chartered Banks.

A lot of things are not possible unless you are there in person and salary unfortunately, is one of those things. It may be understandable, but even if it is done it will basically delay for three months to cause the payment of salary just like a new employee in the public sector.

So public sector salary processing leaves much to be desired, this affects all employees especially, teachers and nurses whose services are required everywhere, even the remotest parts of the country.

Mind you private sector wages and high GDP per capita of public sector salaries is not going to fall because of cutting of four zeros from the cedi. ?Staggering figures show that over 53 per cent of total government revenue is allocated to wages and salaries, including gratuities and pensions. (Business & Financial Times October 16, 2006).

The problem is compounded when the public sector worker wanted to a change of Bank where s/he receives salary. Most companies in Ghana tend to do their savings by company at specific banks, because they claim it makes the work of the accountant (accounting, book keeping, etc.,) easier.

Therefore, another reason to justify redenomination remotely though, is the shortage of accountants in the country. The media reported a few years ago that the country have to train 8,000 accountants a year for the public sector reform and decentralisation to work. This calls for a Marshall Plan to make Polytechnics train accountants as a priority instead of a redenomination at this time.

Why is the concern about accountants? It should not be the case, since accountants are professionals who should not even have such problems because dealing with numbers is their job. They should therefore be able to identify and are trained to use indices better than ordinary people.

They should actually be those who should apply the use of units on top of tables not the ordinary people on the street. To the ordinary person, none as far as I know, have complained about current use of the Ghana cedi. So why fix what is not broken?

It is the accountant who enjoys the goodwill of the banks as they are seen to be bringing many customers the bank. However, these same accountants are often unable to broker better treatment by banks for workers, to the detriment of the individual employees.

Views expressed by the author(s) do not necessarily reflect those of GhanaHomePage.