Determinants of Public Expenditure in the DRC : Impact of Public Sector Staff Rationalization on the Control of the Wage Bill and Monetary Mass from 2010 to 2026

ODIMBA PLAMEDI

Abstract


The public wage bill in the Democratic Republic of Congo (DRC) absorbs 40–48% of internal revenues, despite representing only 4.9% of GDP projected for 2025, thus exceeding the IMF commitment of 35% and limiting public investment to 2% of GDP. This study employs Principal Component Analysis (PCA) and Difference-in-Differences (DiD) methods to test the hypothesis that staff rationalization through SYGECPAF bancarization (from 33% to 100%), biometric identification in 2023, and a retirement plan for 300,000 agents helps reduce monetary pressure by limiting unproductive liquidity.

Key results show that the first principal component (PC1) explains 41.6% of the variance and confirms a strong correlation between staff numbers and the wage bill (loadings 0.66–0.68, p<0.01). The reforms have stabilized the wage bill at 4.9% of GDP compared to 12% before 2023, generating annual savings of $0.5 billion USD. Compared to UEMOA (8.1% of GDP) and Rwanda (7.5%), the DRC displays a competitive ratio despite high budget rigidity linked to revenues (48% versus 30%).

The robustness of results is validated by a Variance Inflation Factor (VIF) below 5 and a Farrar-Glauber test (p=0.59) confirming the adequacy of controls for GDP growth, inflation, mineral prices, and the conflict in the East.

Policy implications include adopting performance-based pay (Rwanda model), implementing a rigorous CNSSAP audit, and a reform shock planned between 2026 and 2028 aligned with the IMF program amounting to $2.8 billion USD.

Keywords


Masse salariale publique, rationalisation des effectifs, ACP, DiD, finances publiques, RDC, conditionnalité FMI.

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References


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DOI: http://dx.doi.org/10.52155/ijpsat.v57.1.8176

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