August 15, 2016Doug Hadden
The Government of Uganda recently eliminated more than 5,500 “ghost workers” from the wage bill. “Ghost” or “phantom” workers can be a significant drain on government finances. The wage bill averages about 24% of total expenditures and 6.52% of annual GDP in 154 countries according to the International Monetary Fund (IMF). Governments tend to the largest employer in developing countries, sometimes representing 1/4 of all jobs.
Governments often pay “ghosts”, including civil servants who have passed away, are working somewhere else, have taken on the identity of someone else, or are padding the income of managers. The problem of ghosts in the wage bill is common, with recent efforts and identified problems in African countries like Cameroon, Ghana, Kenya, Lesotho, Malawi, Mali, Nigeria, Tanzania, and Zimbabwe.
Uganda has eliminated almost 14,000 ghosts out of an establishment of a little over 300,000 public servants. That’s about 21% of all registered staff.
Information Technology and Public Service Audit
The audit used to eliminate the most recent cadre of ghosts was enabled through the integration of the government-specific human resources and payroll system from FreeBalance and the Uganda National Identification system. This supported the Government of Uganda focus to reducing waste in the wage bill. The FreeBalance software for civil service management is called: the Integrated Personnel and Payroll System (IPPS) in Uganda.
Many developing countries lack the effective information systems in use in countries like Uganda. “In many settings, civil service managers do not have up-to-date lists of who they employ to do what. It is a fertile environment for ghost workers.”
Manual systems and payment in vouchers or cash introduce opportunities for fraud and corruption. In addition to the savings from the elimination of ghost workers, the Government of Uganda has saved significant funds through the decentralization of payroll management. “The decentralization of the wage payment in the public sector has largely achieved the objectives of timely payment of workers” salaries and increased savings on the wage bill formally spent on ‘ghost workers.‘” The “reduction in ghost workers and the overall wage bill at MDAs and local governments through the IPPS and the decentralization of the wage and payroll management system” have been seen as a major accomplishments in Uganda.
Problem of Ghost Elimination
We have had many discussions about the context of ghost workers at annual FreeBalance International Steering Committee (FISC) meetings. Uganda has participated in FISC since acquisition in 2009 and has shared good practices with representatives from other countries. The consensus among FISC members is that ghost worker elimination is not easy to accomplish.
- Political connections: those participating in corrupt practices can be connected to political parties, with significant influence
- Classification mistakes: classification mistakes, spelling transliteration or failure to update records can provide false positives
- Identity transfers: public servants can switch positions in order to be closer to home rather than operate through the human resources system
- Qualification: public servants can take on the identity of someone fully qualified for a position whose requirements are unrealistic
- Election considerations: public servants can be added to the payroll rolls in order to generate votes for political parties
The elimination of ghost workers to reduce the wage bill is not a simple task. It should be part of overall public service reform that ensures living wages for staff, improved capacity and streamlined processes. Patronage and rent-seeking prospers in environments with “an outdated and fragmented legal framework; an inadequate HR management system for civil servants, with proliferating “ghost workers” … an over-aged, poorly motivated public service; and … an opaque and inequitable wage system.”