Official documents have revealed that the government has approved meager financial allocations for employees as a cost-of-living allowance, a move criticized as a maneuver to offset the impact of recent customs duty increases.
In May, the government implemented measures to mitigate the effects of its decision to liberalize customs dollar exchange rates, effectively increasing duties by over 100%. Among these measures was the approval of a 20% cost-of-living allowance and the resolution of pending job adjustments and annual increments for all civil servants.
However, official records indicate a deceptive calculation of the 20% allowance. According to government session minutes, the allowance was based on the "starting salary of the job grade on the salary scale," rather than the current government-determined salaries. This approach means the 20% is applied to an outdated wage structure.
This discrepancy is evident in a directive from the Ministers of Civil Service and Finance detailing the calculation and disbursement of the allowance. A table attached to the directive shows that the lowest allocated amount is 5,480 Yemeni Riyals for the twentieth job grade, with the highest being 20,000 Riyals for a deputy minister. Furthermore, these already reduced amounts are subject to legally mandated insurance deductions, further diminishing their value.
A similar methodology is being applied to the government's decision to disburse annual increments for the years 2021-2025. The directive specifies a 4% annual increment based on the starting salary of the job grade, mirroring the cost-of-living allowance calculation. However, this increment is also restricted by several conditions, including exclusion for employees nearing retirement, deceased individuals, or those declared totally disabled.
Specialists have expressed surprise at the government's strategy of circumventing its obligations through such low calculations for allowances and increments, particularly when the initial objective was to address the repercussions of increased customs duties. They noted that the liberalization of customs dollar rates is expected to generate approximately 60 billion Riyals monthly for the state treasury, suggesting that less than 10% of this increased revenue has been allocated to improving employee conditions.
