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Bloated public sector cannot boost economy

Daily FT

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August 18, 2025

LAST week, the Government announced that approval has been granted for the recruitment of 62,314 individuals into the public service over the past eight months. A special committee, chaired by the Secretary to the Prime Minister, has been tasked with overseeing this massive intake. According to the cabinet spokesperson, some of these recruitments have already been finalised, while others remain at stages such as examinations and interviews.

At first glance, this may appear to be a sign of progress; tens of thousands of jobs created and young people given “secure” employment. But beneath the surface, this announcement represents a deeply troubling continuation of one of Sri Lanka’s most destructive economic habits of using the public sector as a dumping ground for political promises and patronage.

This country already has one of the most bloated public sectors in the world. More than 1.3 million out of 8 million employed individuals are State employees. That means one out of every six workers is paid by the taxpayer. This is not a symbol of social protection but a dangerous, unsustainable burden on the economy. At a time public finances are already stretched to breaking point, the Government is adding tens of thousands more salaries to its payroll.

Daily FT

This story is from the August 18, 2025 edition of Daily FT.

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