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To save its economy, can Tunisia reform its oversized public sector?

Government buildings in Tunis, the capital of Tunisia. Photo by Amy Keus on Wikimedia (CC BY-SA 2.0)

Recruitment of public servants has increased massively in Tunisia since the 2011 revolution. Now the economic downturn is pushing the country towards reform in an effort to cut public expenditure.

Tunisia’s economy was already in bad shape, after decades of low wages and high unemployment, which were the root causes of the “Jasmine Revolution.” The COVID-19 pandemic has made things worse, increasing the lack of jobs and deepening the crisis. Mired in debt, the Tunisian government is now turning to the International Monetary Fund (IMF) for a bailout of 4 billion United States dollars. According to the prime minister, Hichem Mechichi, this is the “last opportunity” to save the country’s economy, but it is conditional on Tunisia reforming its economy and reducing its public sector wage bill and subsidies.

Tunisia is regularly acclaimed by Western governments as being the Arab Spring success story, but the state of its finances is threatening the political transition to democracy. The country has accumulated a chronic deficit estimated at 11.5 per cent of gross domestic product and public debt at 90 per cent of GDP. The payment of public salaries represents over half of state spending and is among one of the highest in the world, in comparison with the size of the Tunisian economy, according to an IMF study.

The high price of ‘social peace’

The number of public servants has grown exponentially, almost doubling since the revolution. One after the other, successive governments have used public jobs to appease public discontent. “Work, freedom and dignity” have been unabating key demands of Tunisian youth frustrated by widespread corruption and lack of opportunities. With the right to work with dignity and a fair wage enshrined in the constitution, governments have been under pressure to create jobs. In the absence of a robust economic plan and a welfare state, people have been recruited in public administrations not based on a need but in response to protests for jobs and social justice. Kamel Ayadi, former minister of the public sector, stated that governments hired people to buy “social peace.” Street protests across the country by unemployed youth demanding their “rights for development and work” in Kassrine, Tataouine and other towns resulted in promises of public employment. This culminated in 2020, when following months of protests by Tunisian graduates, the parliament adopted a bill guaranteeing all those who had been unemployed for at least a decade to be recruited by the public sector—though it is not clear how and whether these measures will be implemented.

As well as responding to the demand for jobs, hiring in the public sector was also used for other partisan political motivations. Many have been accused—in particular, the Islamist party Ennahda—of having massively recruited among their partisans and loyalists to ensure their consolidation of power. Under the previous regime of Zine El-Abidine Ben Ali, the Islamists were the main opposition and were persecuted and banned from power. After decades of oppression, public tenure was seen by the new post-revolution leadership as a fair reparation and compensation for their past exclusion. The biggest surge in public hiring took place during the rule of the “Troika” alliance between 2011 and 2014, led by Ennahda. According to the Tunisian Union of Public Service and Administration Neutrality (UTSPNA), “Ninety per cent of appointments in the public sector under the Troika were made on the basis of partisan, regional or family orientations.” Ambassadors and consuls, governors, magistrates and managers in strategic areas such as the media, security and IT were recruited among the party supporters, reports said. A controversial amnesty law was also adopted in 2012 granting public sector jobs to over 7,000 people who were wounded in the revolution, as compensation and recognition of their sacrifice.

In an interview with me Mohamed*, a young engineer said, “Successive politicians have contributed to deepening corruption. They have turned the administration into a dysfunctional mammoth uncapable of fulfilling its primary functions. These populist short-sided measures are a recipe for disaster.”

Deterioration of public services and increase in wages

Under pressure from the powerful General Union of Tunisian Workers (UGTT), the uncontrolled increase in the number of public servants has been coupled with an increase in salaries. According to a study by the National Institute of statistic (INS), salaries rose by 23.18 per cent between 2011 and 2015, with the highest increase being under the Troika in 2013. This combination has led to a sharp rise of the public wage bill in an already strapped state budget. The increase in staff and salaries, however, hasn’t resulted in better performance, quite the opposite. Most public services—education, health, security etc.—have deteriorated. The private sector is filling the gap with burgeoning private schools and hospitals at an unaffordable price for most Tunisians.

“These past 10 post-revolution years, romanticised by the West, have solidified for us as more misery and living with the failing of state’s institutions. We used to have great public services. But now everyday there is a new thing breaking. Basic services such as water is now of too poor quality to drink. We buy bottled water. Transports are crowded and dangerous. Schools or hospitals became so bad that we must turn to the private sector. But who can afford it?”, Salwa* a retired public servant told me bitterly.

What is most problematic is not the size as much as it is the performance of the administration. Not based on needs, skills and merit, productivity and efficiency have fallen. In 2015, a study by the Tunisian Anti-Corruption Association found that absenteeism in the public sector was alarmingly high and that civil servants effectively worked for an average of only eight minutes per day. Tunisians have lost trust in public institutions. A national consultation conducted by the National Body Against Corruption (Instance Nationale de Lutte Contre la Corruption) in 2020 showed that 87.2 per cent of Tunisians believe corruption had seriously increased and 28.5 per cent reported having experienced at least one situation of corruption in 2020.

Most of the political class and citizens agree that the public sector is unsustainable and needs to be reformed urgently. There have been numerous attempts at reform but not with any real breakthrough. As in other sectors, Tunisia has been slow to take measures, postponing or taking one step forward and two steps back for the benefit of the few, and hampering change at the expense of the majority. International donors have contributed to this economic downfall resulting today in Tunisia urgently seeking a rescue loan from the IMF. In an unstable region and in a country on the doorstep of Europe, donors priorities have been to consolidate the democratic transition even at the price of keeping afloat a dysfunctional failing economic system. It has had a pervasive effect, creating a non-virtuous cycle of funding not commensurate with economic progress which in the long term undermines, rather than supports, the democratic transition.

*Names changed by request

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