Home » Governance » Cut Salaries, Zimra Tells Government

UNDER constant pressure to find money to pay the country’s 500,000 civil servants, the Zimbabwe Revenue Authority (Zimra) has told the government to cut salaries saying this was the only solution to its financial crisis.

Zimra chief Gershem Pasi also said the country needed to learn to live within its means and not continue to create institutions it could not fund. He gave the expanded Parliament as an example.

“Today we are talking of creating fiscal space, you can’t do much with the set up that we have,” said Pasi.

“Look at the expansion that happened with the new Constitution of the legislature. Can we afford it?

“We created so many additional members in both houses but at the end of the day we must pay for it. When the expansion was done, there was no consideration on the cost of such an expansion to the legislature.”

Finance minister Patrick Chinamasa admits that the government’s wage bill, at more than 90 percent of income, is unsustainable but appears hesitant, for political reasons, to trim the administration’s huge workforce.

“Why not say cut by 20 percent across the board cut wages, interest rates, everything because it will be a social contract. We will give ourselves room to start the growth process,” Zimra chief Gershem Pasi is quoted as saying by the state media.

His remarks come after a similar call by central bank governor John Mangudya who suggested a wage and price freeze to help the country emerge from its economic problems.

The tax collection chief said salaries were pegged at unsustainable levels when the country ditched the Zimbabwe dollar and adopted foreign currencies in 2009.

“We pegged our wages and salaries basing on that artificial level which was premised on the hyper-inflationary environment we had just come out of,” he said.

“My proposal is that we have never needed a social contract more than now. And that social contract should not be there to maintain the status quo.

“Dr Mangudya in his statement urged that there should not be any increase in salaries. What would happen if we went further let’s cut the salaries. Let’s cut prices.

“All we are doing will be just fire-fighting but the truth is we are going deeper and deeper into the hole until we take drastic measures.”

However, labour unions have warned that they would resist any attempts to cut or freeze wages which are already below the country’s poverty datum line.

The Zimbabwe Congress of Trade Unions (ZCTU) described the call for a wage freeze “as a reckless attack on the rights of employees”.

“They (Zimra and central bank) made reckless statements without looking at the situation holistically and due to that employers have found a loophole and a finger to hide behind and are therefore not paying salaries and are averse to coming to the negotiating table to discuss conditions of service for employees,” the labour body said.

“The leadership of the ZCTU, having noted the bad and unethical stance set by the mentioned authorities, would like to inform all affiliates that they should ready themselves for demonstrations concerning these utterances by authorities mentioned above.”

Source : New Zimbabwe