78% of Lami Town Council budget goes to staff salaries, wages

A large portion of the Lami Town Council’s budget is being used to pay staff wages and salaries, leaving only 22 per cent for all other expenses, a situation that has raised questions from Members of Parliament.

The issue was revealed during a hearing before the Standing Committee on Public Accounts yesterday, where the council appeared to respond to audit findings from 2016 to 2018.

Council acting chief executive officer Azram Khan confirmed that 78 per cent of the council’s total budget is spent on wages and salaries.

“Wages and salaries stand as the highest expense given that all the basic services, grass cutting, garbage collection are done in-house,” Mr Khan told the committee.

He explained that Lami does not outsource its services. Instead, it employs its own workers to carry out daily operations.

Opposition MP Alvick Maharaj sought clarification, asking whether the 78 per cent referred to software costs.

“Does that mean only 22 per cent is left for all other services?” Mr Maharaj asked.

Mr Khan replied clearly: “78% goes towards wages and salaries payment bill, including FNPF and FRCS contributions.”

The figures raised concern among MPs about whether enough money remains for development and improvements in the small municipality.

While most of its funds go to staffing, the council says keeping services in-house allows better control.

“We have a more effective management of the system,” Mr Khan said. “If there are challenges in garbage collection, we are able to pull staff from another section.”

He added that this “pool system” allows flexibility when workers are on leave or when extra manpower is needed.

The council also told the committee it is using WinBiz software for payroll and revenue collection, while some other processes are still done manually or through spreadsheets.

Mr Maharaj questioned why councils are developing their own systems when the Ministry of Local Government plans to introduce a national integrated system.

Mr Maharaj said it “does not make sense” for councils to spend money on systems that may later be replaced.

In response, Mr Khan said Lami is working with software provider SoftLogic to introduce a more integrated system costing about $15,000, with an annual service fee of $1,500.

However, MP’s key question remains, with 78 per cent of its budget going to salaries, will Lami Town Council have enough funding left to turn its development plans into reality?

Meanwhile, the public accounts committee is expected to further review the council’s financial management and make recommendations.

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