SAN JUAN (Puerto Rico) - MORE than 30,000 government employees - about 14 per cent of the public work force - could lose their jobs and new taxes will be introduced as Puerto Rico attempts to shore up its ailing economy, the governor of the US island territory announced on Wednesday.
In a half-hour televised address, Gov. Luis Fortuno outlined a plan to cut a long-bloated work force - excluding police officers and teachers - and institute new taxes to increase revenue on the cash-strapped island, which is in its third year of recession.
The layoffs will begin on July 1, the start of the new fiscal year - and are necessary even when taking into consideration the roughly US$5 billion Puerto Rico is slated to receive from President Barack Obama's $787 billion stimulus package over the next two years, the governor said.
The government is Puerto Rico's main employer, with 218,000 people, or 21 percent of the work force on the island of 3.9 million inhabitants. Economic analysts have been advising Puerto Rico, which currently has a $3.2 billion budget deficit, to slash its sprawling public payroll for years.
'The government is too big and spends too much,' Fortuno said. 'Simply, the government has to be minimized.'
The governor, a Republican who is the leader of the pro-statehood New Progressive Party, said Puerto Rico was facing its most painful financial crisis in decades, and failing to take immediate action to rein in spending would push the economy into a depression.
Opposition legislators could not immediately be contacted for comment. -- AP