[stop-imf] IMF staff buyout draws more interest than expected

[robert weissman]

These stories report on the unexpectedly robust response among IMF staff
to buyout offers. It turns out the IMF induced 50 percent more staff
than desired to request a buyout. This reflects on the low morale at the
institution, but says something also about the Fund's predictive powers.


  http://www.reuters.com/article/ousiv/idUSN2849197720080429?pageNumber=3D1=
&virtualBrandChannel=3D0



  IMF staff buyout draws more interest than expected

Mon Apr 28, 2008 11:41pm EDT

By Lesley Wroughton

WASHINGTON (Reuters) - Around 600 International Monetary Fund employees
have requested buyouts under a plan aimed at cutting 380 jobs, officials
said on Monday.

IMF staff and board members said the number was at least 585, with some
saying it is as high as 620, about a quarter of the fund's 2,400
full-time staff.

The job cuts are part of broader plans to modernize the Washington-based
institution and attract new staff to expand its oversight of global
financial and capital markets, while also downsizing and cutting costs.

IMF spokesman Masood Ahmed confirmed that the number of employees that
have requested buyouts was "somewhat in excess" of the 380 jobs that
needed to be cut.

Ahmed said the result of the buyout offer would be made on Tuesday.

He said the large response to the buyout meant that no-one would be
forced out of their job involuntarily. However, it was unclear if the
IMF would extend the buyout beyond the 380 jobs it intends to trim.

"Even with this number of volunteers, which are somewhat in excess of
the 380 we had identified, the challenge is to focus the fund in terms
of doing the kinds of things the membership finds most useful for their
needs going forward," he told Reuters.

Domenico Lombardi, president of the Oxford Institute for Economic Policy
and a former IMF board member, said IMF staff morale has run low for
several years as the fund has undergone internal changes amid a shifting
global economic environment.

"The (buyouts) reflect low staff morale that has been going on for quite
some time, and the perception in the eyes of many economists that the
IMF has lost relevance among member countries," Lombardi said.

"Certainly, the most relevant factor is that the IMF is seen as less
central, less important, and therefore people have less incentive to stay."

He also cited the weakening U.S. dollar, which undercut the
competitiveness of IMF salaries and benefits for European staffers.

"In the United States, the IMF has also lost clout vis-a-vis with
competing employers such as academic institutions, which nowadays offer
very good and very competitive salaries," said Lombardi, who also is a
senior scholar at the Brookings Institution.

Lombardi said it was critical for IMF Managing Director Dominique
Strauss-Kahn to show strong leadership to rebuild the institution as a
desired location for international economists.

"Certainly the IMF should find new ways to become more attractive also
as an employer, not only as lender, not only as a provider of policy
advice," Lombardi said.

Ted Truman, a former U.S. Treasury official during the Clinton
administration and now a senior fellow at the Peterson Institute for
International Economics in Washington, said the fund needed to trim a
bloated workforce.

"It is very top heavy, so by cleaning out all these advisors and so on,
it increases chances of promoting some good younger people and
attracting some people in the mid-career category," he said.

(Reporting by Lesley Wroughton; editing by Neil Fullick)

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*
IMF cost cuts spur over 500 redundancies*

By Chris Bryant and Krishna Guha in Washington

Published: April 30 2008 00:08 | Last updated: April 30 2008 00:08

Almost 500 International Monetary Fund staff are set to leave after 20
per cent of the fund=92s workforce requested voluntary redundancy as part
of a plan to deliver $100m in cost savings.

The announcement was made as the IMF disclosed that member countries
almost unanimously approv=ADed a new voting system to give emerging and
developing economies greater influence. The fund originally sought 380
voluntary redundancies, mainly in senior management and administrative
roles, but its buyout offer was heavily oversubscribed, drawing 591
applications from 2,900 eligible staff.

Although the IMF said it would accommodate redundancies =93in excess of
the required 380 positions=94, between 100 and 125 applications will be
rejected after almost half of the requests to leave came from senior
economists, whom the IMF is keen should stay.

About 25 per cent of middle and senior management accepted redundancy,
including six department heads, representing the first significant job
losses at the IMF since the organisation was founded at the end of the
second world war.

The job losses form part of the fund=92s attempts to cut costs and refocus
activities away from lending towards a greater emphasis on knowledge and
global economic surveillance.

The fund has seen a decline in its loan-making activities to nations in
financial difficulty, which used to be its primary source of income,
threatening to create a $400m (=A3203m) shortfall by 2010. The IMF=92s
shareholder governments agreed to back a new funding model, but only if
it cut costs aggressively.

A senior IMF official denied that the level of buyout requests pointed
to low morale. However, a source close to the IMF who did not wish to be
named because he was not authorised to speak acknowledged there was a
morale problem among staff but that it had improved since Dominique
Strauss-Kahn was elected managing director last year.

The IMF has been attempting to take a more prominent role in the
handling of the credit crisis, but the US and other national authorities
have made clear that they intend to be in the driving seat on policy.

=93I am pleased that this outcome will allow us to achieve our
restructuring goals with the least possible uncertainty for staff and
disruption of service to our membership,=94 Mr Strauss-Kahn said.

The IMF said 175 countries representing 93 per cent of the total voting
power had approved reforms to its quota and voting structure, increasing
the voting power of two-thirds of member countries. =93The new structure
represents an important step toward a redistribution of voting shares
toward developing countries and we expect a continued shift over the
next decade,=94 Mr Strauss-Kahn said.

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