Parliamentarians demand clarity on austerity measures

HARARE - Parliamentarians have asked Finance minister, Patrick Chinamasa, to clarify the austerity measures for the civil service which he proposed in his Mid-term Fiscal Statement, it has emerged.

Austerity means cutting expenditure, retrenching, halting projects or reducing spending, and in the Zimbabwe situation, this would include reduction of expenditure on social sectors of the economy.

The parliamentary portfolio committee on Finance chairperson, David Chapfika, last week during a debate on the Mid-term Fiscal Policy Statement in Parliament said Chinamasa’s lack of clarity on the issue encouraged policy inconsistency.

“The Hon. minister proposes to reduce employment cost from about 80 percent to 40 percent of total expenditure, without stating how he intends to achieve this.

“It is your committee’s view that to achieve this; the Hon. minister will either reduce the size of the civil service or reduce the salary levels of the current workforce,” Chapfika said.

He also said the main challenge emanating from the matter was that government does not have the resources for retrenchment packages should it lay off some of its employees nor can it effect a salary cut as this would be in violation of our labour statute.

“The committee requests the Hon. minister to explain how he intends to deal with this matter,” Chapfika said.

This was after Chinamasa sent the country into a frenzy of speculation after declaring that he intended to cut the civil service bill by half, leaving most people wondering if government was going to institute mass retrenchment.

The minister said about 83 percent of what government was making was being channelled towards salaries, a situation which he said was “increasingly unsustainable”.

He said government was “concerned” with the level of resources from the National Budget that employment costs continued absorbing, at the expense of developmental expenditures.

According to the Treasury chief, progress has been made over the exercise to develop measures to rationalise the wage bill, with the Public Service Commission having also completed the physical head count for all civil servants as part of a staff audit.

If government moves and retrenches — the move will appease the International Monetary Fund — whose chief recommendation for freeing fiscal space has always been culling government’s workforce.

The IMF through its Staff Monitored Programme, a supervised economic reform programme, has been advocating for Zimbabwe to cut its wage bill.

The country’s wage bill, which has so far gobbled up 82 percent of government revenue, has been a topic of constant discussion with Chinamasa saying he was not going to cut jobs to contain government expenditure.

In his 2015 budget statement, Chinamasa warned that recurrent expenditure would go up to 92 percent in 2015, the bulk of it paying wages of the government’s estimated 235 000 workforce.
 

    Comments (1)

    we need clarification?????

    ngororombe - 12 August 2015

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