Government bigwigs get pay cuts as Zimbabwe looks for financial stability

23 November 2018 - 07:17 By James Thompson
Zimbabwean finance minister Mthuli Ncube Ncube preached “austerity for prosperity” during his budget speech on Thursday.
Zimbabwean finance minister Mthuli Ncube Ncube preached “austerity for prosperity” during his budget speech on Thursday.
Image: AFP

It was meant to be finance minister Professor Mthuli Ncube’s chance to win the trust of the Zimbabwean public and business sector, as he tried to stir the country's economy in a positive direction when he presented the 2019 budget in parliament on Thursday.

His presentation overshadowed the Kgalema Motlanthe-led commission of inquiry into the post-election August 1 killings, which were largely blamed on the army and its involvement in civilian politics. During his statement, the minister noted that political stability was key for the country to realise economic progression.

“Growth will be anchored on good governance and promotion of democratic principles,” he said against the backdrop of the Movement for Democratic Change (MDC) Alliance constantly arguing that the country’s problems were largely based on the fact that President Emmerson Mnangagwa’s government lacked political legitimacy.

It didn’t take long for conflict to rear its ugly head in parliament when opposition legislators were violently chased out after they refused to honour Mnangagwa’s arrival.

MDC Alliance spokesperson and parliamentary chief whip Thabitha Khumalo collapsed during a scuffle that involved the police.

Ncube walked a tightrope in his presentation. He preached “austerity for prosperity”, similar to what Tendai Biti argued for during his time as finance minister.

However, as an opposition finance minister under strongman Robert Mugabe, Biti’s words fell on deaf ears. 

Ncube announced an intention to cut the salaries of cabinet ministers and senior civil servants by 5%. His budget-beating antics will also affect heads of government-owned companies.

“Effective January 1 2019, a 5% cut on basic salary be effected for all senior positions, from principal directors, permanent secretaries and their equivalents, up to deputy ministers, ministers and the presidium.

“This is also extended to basic salaries of those in designated posts in state-owned enterprises (CEOs, executive directors and equivalent grades),” he said.

Last year, the International Monetary Fund (IMF) advised Zimbabwe to cut its civil service, which took up 90% of the country’s budget. Doing so would give government leverage to improve social services such as health and education, infrastructure development and power-generation projects.

But at the time, heading towards watershed elections where provision of jobs was a key promise, the Zanu PF government ignored the call.

However, Ncube took heed of the IMF’s advice. Ghost workers, mostly Zanu PF youths, known as “youth officers”, who run into thousands will be laid off.

The minister also revealed that all government property, especially vehicles, will be under strict surveillance. For the first time since independence, government vehicles are to be left at the workplace at the end of day or taken to the nearest police station for safe-keeping.

By the time the budget was presented, the 92-page document had found its way onto social media.

We have a problem as Zimbabweans of being negative about everything.
Tendai Moyo

Tendai Moyo said: “We have a problem as Zimbabweans of being negative about everything. We have taken no time to learn of the power we have to hold government to account on promises they make. We must collectively, regardless of political affiliation, hold government to account on this budget speech."

But the most underwhelming part for most ordinary citizens was the failure to address bond notes, the local surrogate currency that has lost more than 400% value against the American dollar.

“I thought he would tell us that the bond notes are a thing of the past and maybe announce new measures. Instead he showed us that government is still hard pressed for foreign currency because now we have to pay in forex for goods that we import into the country especially cars,” said Brian Shoko.

Shoko fears another fuel price hike after Ncube announced an increase in excise duty of seven cents per litre on diesel and paraffin, and 6.5 cents on petrol.

“It’s common sense that a fuel hike has direct effect on goods and services. We are going to have a gloomy Christmas,” he said.

Among the key announcements were:

  • 5% pay cut for cabinet and deputy ministers, senior civil servants and government-owned company bosses;
  • Close eight foreign embassies;
  • Fire youth officers hired by Zanu PF and integrated into government wage bill; and
  • Budget pegged at $8.16bn for 2019.

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