Difference in Public Sector Salary is Brought About by Allowance

According to a new study conducted by the Ghana Statistical Service (GSS), wage disparities are being exacerbated by variations in allowance amounts given to public sector employees.

As a result, there is now a wider gap between employees' gross wages, with those with higher net salaries typically receiving higher allowances.

The study is called: According to the study titled "Ghana 2022 Earnings Inequality in the Public Sector," the average allowances of individuals who earn between GH5000 and GH9999 are more than 26 times higher than those of those who earn less than GH1000.

In response to the report's findings, Government Statistician Prof. Samuel Kobina Annim stated that progressive statutory deductions, in which higher earners pay more, was one approach to reducing income inequality.

He stated that, despite being progressive, the disparity in deductions between income groups was marginal and had little effect on reducing earnings disparities.

According to the study, those with salaries between GH2999 and GH1000 paid 20 percent of their gross salary in statutory deductions, while those with salaries above GH10,000 had an average of 25 percent.

It was also pointed out that the basic salary, deductions, and allowances all increased with age, with the highest increases occurring between the ages of 50 and 60.

The report stated, "However, the rate of upward changes in earnings between ages 20 and 40 is slightly steeper than increases after age 40."

The study looked at how 687,984 public sector workers from 50 Ministries, Departments, and Agencies (MDA) and 129 payrolls made GH2.3 billion in salaries and benefits in December 2022.

The Controller and Accountant General's Department's data were not comprehensive because they did not include employees of public universities, security agencies, Article 71 officeholders, or other non-subvented institutions.