Kuwait : The strategic payroll alternative is a project that was proposed in 2015 by the Civil Service Commission (CSC) to have similar salaries among Kuwaiti citizens who work in the public sector as long as they have the same qualifications, degrees and positions. This project was welcomed by large segments of Kuwaiti citizens, especially those who work in sectors that don’t pay high salaries compared to other sectors, such as oil and gas.

Since the CSC proposed this project, there have been many opposing voices who said this move does not achieve justice for citizens who work in a highly demanding jobs, compared to others who do not, warning there will be a huge turnover in many sectors if wages will be equaled, according to previous statements made by officials in the oil sector.

But calls have been rising recently to implement the project due to price hikes affecting consumables and essential goods around the world including Kuwait as a result of inflation and political issues. Some have called for raising salaries in specific sectors and jobs to support citizens instead of using the strategic payroll alternative due to its huge impact on the country’s budget.

Wages cost

Earlier this month, chairman of the budgets and final accounts committee Adel Al-Damkhi said recruitment represents 56.7 percent of the country’s budget, stressing it is a technical issue that will have a great financial impact. He pointed out the recruitment cost used to have a supplementary budget, but now the budget has to include a figure, revealing that “KD 500 million was set in the previous budget to employ 23,000 Kuwaiti citizens”.

According to labor market data issued by the Central Statistical Bureau (CSB) in Feb 2022, the average salary of citizens in Kuwait increased by more than 9.3 percent, amounting to KD 127 ($410.03) in the last six years, as it reached by the end of Sept 2021 KD 1,490 compared to KD 1,363 for the same period in 2015.

Therefore, despite the stability of oil prices so far, especially after the COVID-19 pandemic and the impact of the Russia-Ukraine war on global prices of raw materials, will Kuwait succeed in implementing the strategic payroll alternative project without impacting the country’s budget and achieve justice for citizens?

The positive impact

Former member of the advisory committee of the project Abdullah Al-Abduljader stated earlier at a conference at Kuwait Economic Society (KES) that if this project was implemented when it was proposed in 2015, it would have resolved several main problems in the country such as unemployment and achieved justice in wages.

CSC proposed the payroll project and provided a basic salary schedule, considering it as one of the proposed solutions to reform budget expenditures. It also said it will provide a sustainable system that provides fairness and transparency in the salary scale among citizens if it is implemented and updated. The project’s main goal according to CSC is to manage growth in payroll expenses, encouraging high level of performance and increasing fairness and transparency, as mentioned previously.