ECONOMYNEXT – Crisis hit Sri Lanka will see at least 30,000 state workers retiring by 2022 and no new recruits will be made to replace them, a top government official said, as the President Ranil Wickremesinghe administration is in the process of reducing a bloated state sector amid a deal with the International Monetary Fund (IMF).
Sri Lanka reduced the retirement age of state employees twice this year from 65 to 60 among many other measures to reduce state sector expenditure in a reform to cut down government spending as the country reels from an unprecedented economic crisis.
State workers going on retirement will receive pensions that markup 85 percent of their salary, the government official who has direct knowledge on the government’s new recruitment policy, told EconomyNext.
Thousands of state sector workforce retiring will be Sri Lanka’s defense sector as the army has decided to vacate posts of over 16,000 military personnel on a budget proposal by President Ranil Wickremesinghe ahead of the IMF deal.
The country will not be employing any new workers to fill in the vacant positions due to financial constraints and clauses by the International Monetary Fund (IMF) agreement, the official said.
The IMF reached a deal with Sri Lanka for a 4-year, 2.9 billion US dollar Extended Fund Facility (EFF), subject to debt restructuring and prior actions, however the approval for the loan is delayed beyond the earlier expected January 2023 due to a complex debt restructuring negotiations with the island nation’s bilateral creditors. (Colombo/Dec31/2022)