Half of New Orleans staff asked to leave

Half of New Orleans staff asked to leave

The mayor of New Orleans, Ray Nagin, has retrenched 3,000 public employees as the city grapples with financial problems in the aftermath of Hurricanes Rita and Katrina. They make up for almost half of city's public employee population. Those who have been spared include police officers, fire fighters, medical workers and other staff serving in the essential services sector.

With coffers draining in the city and money coming in only through federal aid, the monthly payroll of municipal employees amounting to $20 million had become unaffordable. This job cuts will save up to $8 million.

It was a difficult decision according to Ray Nagin. "I wish we had the money, the resources to keep these people. The problem we have is we have no revenue stream," he said. This decision, it is feared, will dash any hopes of revival of New Orleans in the near future.

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"We talked to local banks and other financial institutions and we are just not able to put together the financing necessary to continue to maintain city hall's staffing at its current levels," the mayor added.

Meanwhile, the American Red Cross and the Federal Emergency Management Agency (FEMA) extended the relocation date of more than 400,000 people who became homeless beyond October 15th, which was the original deadline. They presently are put up in hotels in New Orleans. This effort is costing the government $8.3 million per day. This decision was taken after it was found that many buildings are not yet habitable. Some areas still do not have electricity and drinking water is also not available in many areas.

Presently, only 80,000 of the total 455,000 inhabitants, who lived in New Orleans prior to the hurricane, had come back to the city.