State employees in many provinces of Laos have not received their January salaries in violation of a recent government mandate that the workers be paid on the 25th of every month, indicating that the directive may be a toothless effort to resolve a longstanding problem of lack of regional funds to pay workers on time.
None of the employees from the Department of Health in Savannakhet — the largest province in Laos — has been paid on time, said an official from the agency who declined to be named out of fear of retribution and of being fired from his job.
“Because we just ended one year and began a new one, the finance office has not finished the accounting process for the salaries yet,” he said, adding that the delay has been caused by many state employees moving, quitting their jobs, receiving promotions, and retiring.
He also said that employees from other government departments in Savannakhet have already been paid, except for those who work in the health and education departments.
An official from Savannakhet’s Department of Education also told RFA’s Lao Service that employees at the two agencies have not been paid because of both accounting delays by the finance department and a lack of current funds to be able to pay everyone at the same time.
The delayed salaries have caused financial hardship for those who haven’t received their salaries, forcing them to pay monthly interest rates of five percent or more if they have to borrow money from outside sources, said the source who requested anonymity, fearing retribution and the loss of his job for talking to the media
Because most are low-level workers who command salaries of just over U.S. $100 a month, many are struggling to get by covering basic living necessities and have difficulty repaying the loans, the source said.
The Lao government increased the minimum wage to 1.1 million kip (U.S. $127) per month in May 2018.
Other areas have been hard hit financially due to local budget shortfalls, particularly in northern Laos’ Luang Namtha and Bokeo provinces where most government employees have not received their first salaries of 2019.
“We have not yet received our January salaries,” said a state employee in Luang Namtha. “Now it is February, and we still haven’t received the money, and it is affecting families.”
In southern Laos’ Attapeu province, teachers’ salaries are paid only once every two months, said another source who declined to be identified out of fear of retribution.
Vientiane municipality is the only area where all state employees have received their January salaries, according to an official from the capital city’s Finance Department who declined to be named because he is not authorized to speak to the media.
A perennial problem
Getting paid late has been a perennial problem for state government workers for years in the developing country, one of the most impoverished nations in Southeast Asia, and employees sometimes get paid two or three months later than they should.
The problem prompted Prime Minster Thongloun Sisoulith in December to issue a directive to all provinces to pay state employees on time on the 25th of every month, though there is no penalty for those that do not or cannot comply.
This is not the first time that Thongloun has stepped in to try to tackle the problem. In the past, he has committed his government to promptly paying the salaries of state workers and had the Ministry of Finance issue funds if provincial governments were short of money
Corruption in projects that are not routinely inspected is frequently to blame for delays in salary payments, a finance official working in the prime minister's office told RFA in November, speaking on condition of anonymity.
“And sometimes accountants and finance officers delay payments in order to make some profit themselves,” he said.
Delays in state salaries have forced government employees in some parts of the country to spend half their official work hours not in the office, but doing outside jobs instead, threatening the efficient functioning of their departments, sources say.
Reported by RFA’s Lao Service. Translated by Sidney Khotpanya. Written in English by Roseanne Gerin.