Since the Egyptian parliament rejected the Civil Service Law on January 20, the government has been in a state of panic, as it had already restructured civil servants’ salaries according to the now rejected legislation.

Since the Egyptian parliament rejected the Civil Service Law on January 20, the government has been in a state of panic, as it had already restructured civil servants’ salaries according to the now rejected legislation.

Primie Minister Sherif Ismail’s government is now preparing to return the law to the parliament after introducing amendments in an attempt to find a way out of the many crises it has faced since two-thirds of the parliament rejected the law issued by the president six months ago.

Real estate tax researcher Sayeed Sharif says immediately after the parliament rejected the bill, the government went through severe disorder. At first, spokesman for the Council of Ministers announced a delay in January salaries, but with civil servants’ growing anger, the government retracted and denied its first statements. Furthermore, it has not so far published the parliament’s rejection in the Official Gazette, which violates the law.

If the rejection decision is published in the Official Gazette, says Sharif, the government will have to re-calculate wages according to the Law No. 47 of 1978, which will cost millions of pounds because the rejected law mainly reduced the wages of most civil servants. Replacing Law No. 47, the bill regulates six million civil servants. The government believes that the law aims to develop civil service and improve civil servants’ conditions.

When the law was drafted six months ago, civil servants staged protests, objecting to many points, such a failure to identify maximum working hours or protect civil servants from their bosses, halt bonuses, slow wage improvement and limit promotions.

Non-significant amendments

Sharif says although the bill was issued over than six months now, 99% of state institutions have not raised wages. The only pay raise they offered, says Sharif, was pursuant to the Law No. 47. And the few civil servants who got a pay raise have not suffered any deduction under the bill, pending the parliament’s vote.

Sharif predicts that the new amendments will be nominal, especially when it comes to the financial section.

On National Police Day President al-Sisi said there were too many civil servants and that out of the six million civil servants, only one million were needed. Sharif argues that this is untrue since there is a shortage of civil servants in all government institutions. “The crisis has more to do with the deteriorating civil service rather than with overstaffing,” he says.

Serious indicator

Vice President of the Egyptian Trade Union Federation (ETUF) Abdelmonem Gamal says the revocation of the bill will cause many losses in this period, especially since it is directly associated with the Investment Law that encourages investors to invest in Egypt during the current economic crisis. Revoking the bill will not fix the distorted wage structure and will only cause the government to lose L.E. 20 billion (US $2.5 billion) worth of unjustified pay raises for many civil servants. Repealing it, says Gamal, will also further inequality among civil servants.

Gamal maintains that the intended amendments will only include a few number of articles previously objected to by employees and their ETFU representatives, like the articles on holidays and confidential reports, as well as some things listed in the implementing regulations of the bill, which were made part thereof because the prime minister or any minister may amend the implementing regulations of any law.

Negative impacts

The International Monetary Fund (IMF) has offered to grant Egypt a loan provided that it addresses its defective civil service. In a memorandum referred to the parliament last week, Counselor to the Prime Minister Refaat Qumsan said apart from any external terms and condition, Egypt was in urgent need of reforming its civil service and the IMF was entitled to demand administrative reforms to avoid defective macroeconomics in borrowing countries.

Qumsan says the revocation of the bill prevents the amendment of some provisions of the Social Insurance Law No. 79 of 1975. The amendment is meant to restructure wages, which is reflected positively on civil servants’ salaries. “The repeal of the bill also rescinds the prime minister’s Decision No. 1822 of 2015, which states that the government shall bear taxes for civil servants,” he says. “That decision caused the state to bear L.E. 2.7 billion (US $344 million) worth of taxes.”

Other negative impacts resulting from the abrogation of the law is the repudiation of the Planning Minister’s Decision No. 122 of 2015 on the criteria and mechanisms of organizational development, which was the basis for the organizational structures of the ministries of finance, health, antiquities, culture and higher education, in addition to all governorates and a large number of public bodies.

Finally, revoking the law cancels all appointments, mostly in top management positions, and for those injured during the revolution and military operations. It also delays performance appraisal reports and consequently promotions, and it cancels all paid vacations given to civil servants required to take exams in universities, institutes or schools.