Editor's Comment, by Pesi Fonua

Will the restructuring of government ministries, to be introduced at the beginning of the new financial year on July 1 provide a solution to our current difficulties of a depressed economy, growing unemployment and an under-financed public service? I don't think so.

What we are about to see is the rearranging and the merging of various components of government ministries, with a hope that it will make the civil service more efficient and responsive. But because there will be no cut in the size of the civil service ministries, the restructuring will not solve the problem of poor quality public services, because as much as 90 percent of the votes of some ministries goes on salaries.

The road to a dynamic private sector-driven economy, it seems, is full of empty words and potholes, in a community full of jobless teens, who run from hand to hand in search of their next meal.

Too few opportunities are open to young people, and the face of Tongan poverty looks increasingly smudgy from the top down.

Instead of encouraging the private sector to create jobs, it appears that government believes that it is creating job opportunities by not reducing the size of the civil service. But surely this will lead to a situation where fees and taxes might have to be even further increased to keep them all at work, while every step in that direction reduces the private sector's capacity to grow their businesses and to create jobs.

Beside the hope for fruit pickers to go to New Zealand and Australia, and for soldiers to go off to Afghanistan, and for police and soldiers to take-up peace-keeping duties in the Solomons, there is no national vision for creating jobs.

Government hopes that its public enterprises will become more successful and pay dividends. But does government really believe that these public enterprises can become so successful that it will allow government to become self-sustaining and able to operate without reliance on growth in the private sector?

The downside to this approach is that it is increasingly clear that government is isolating itself, while its economic planning is focused on ascertaining that all on the civil service payrolls are looked after, and the rest of the country is left to fight for dear life.

The difficult situation that we have found ourselves in has evolved from some known factors over the years.

Back in April 2002 when government launched the Economic and Public Sector Reform Program there were clear reasons for such a move, because:

• - government could no longer afford the current patterns of spending;
• - too much went into salaries, and not enough on operations and investments in the private sector;
• - the economy was too dependent on aid and remittances;
  - too few opportunities were open to young people;
• - unemployment was rising and so was inflation; and the result was increasing poverty.

Three years later in 2005, after receiving multi-million pa'anga funding, the Economic and the Public Sector Reform Program came face to face with a demand, not only by the people who were carrying out the reform, but also by the people who they were trying to reform, the civil servants, for a 60, 70, 80% salary rise. It was a mouse chasing its tail, and even though it looked and sounded unreal at a time when the predicted budget shortfall was enormous, the demands were approved.

The success of the civil servants demands brought the 2002 Economic and Public Sector Reform program to a temporary halt. Then, a year later in 2006, on November 16, the reform met its final destiny with the burning of Nuku'alofa. The Economic and the Public Sector Reform of 2002 literally went up in smoke. The Nuku'alofa private sector bore the crunch of the $123 million destruction. Hundreds of jobs were lost. Many small local businesses never recovered. Others are still going out of business as a result of their losses on that day. In its reconstruction efforts, Tonga became hugely indebted to the Chinese government.

Meanwhile the Retirement Fund of the civil servants is estimated at about $80 million, and government is still paying off the millions that it owes to the fund. So in reality government and the Civil Service appears to be rubbing each others backs, despite the rhetoric about downsizing that we have heard from time to time.

In November 2010 a Political Reform Program with a parliamentary election introduced a new system of government that was put in place by 4 January 2011.

Now, one year on, the new government is implementing a Government Structural Reform program, which as it begins to unfold itself appears to be no more than a window dressing exercise, and the rhetoric that we are building a private sector-driven economy is nothing but a stuttering in confusion.