Oman’s Ministry of Finance has ordered all public institutions to halt all privileges granted to public employees outside the framework of the salary payroll, according to a circular issued by the ministry.
The action was taken to cut spending and improve the efficiency and effectiveness of government bodies amid the oil price slump, authorities said.
The circular also said a wide disparity had been discovered in bonuses and benefits being paid to various employees, which created discrimination and dissatisfaction among employees in those agencies.
The Ministry of Finance said bonuses and privileges were not “basic rights” of the job and were outside the framework of public expenditure.
It also said privileges and bonuses have financial burdens on the government bodies’ budgets.
Bonuses include health insurance for the employee and his family, interest-free personal and housing loans, huge cash bonuses for some employees, free scholarships, free cell phones, free medical checks, travel health insurance, furniture allowance and Ramadan and Eids allowances.
Earlier this month, the Ministry of Finance called on all government units to raise efficiency in fee collection, according to a circular.
The measures — which come against the backdrop of a global slide in oil prices that has hit most oil-producing economies — are aimed at developing and strengthening government non-oil revenues, which the ministry says will which gradually reduce the total dependence on oil revenues.
The ministry also asked governmental units to find extra fees from the services they offer to the public that could help strengthening government non-oil revenues.
The 2016 General Budget released in January projects 3.3 billion Omani riyals (Dh31.47 billion) in deficit spending for 2016, which is says it will try to reduce by improving the non-oil revenues as well as cutting expenditures.
Oman posted a budget deficit of 4.5 billion riyals in 2015, as revenues declined by more than 50 per cent.
By Fahad Al Mukrashi
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