Government on weakening incomes due to inflation

Patrick Chitumba, Midlands Bureau Chief
GOVERNMENT has said continuous dialogue is critical to ensuring that workers are cushioned in the face of price escalation and weakening of purchasing power.

This comes as the country is experiencing market shocks induced mainly by the raging Russia-Ukraine war, which has disrupted global supply chains, and the exchange rate volatility blamed on speculative behaviour by some influential economic actors.

In an interview, Public Service, Labour and Social Welfare Minister, Professor Paul Mavima, said the Government was concerned about this development as it negatively impacts on livelihoods, adding that measures were being taken to address the situation.

The minister said continuous discussions between the Government and civil servants under the National Joint Negotiating Committee (NJNC), were thus necessary as the year progresses.

“The cost of living is skyrocketing and there is a need to cushion workers. That is the reason why the discussion will be necessary as the year progresses,” he said.

Despite the prevailing macro-economic shocks, the minister said the Government remains committed to ensuring that civil servant’s salaries match with the prevailing economic situations.

He stated that inflation has been the major setback as each time civil servants’ conditions of service are adjusted — the market also adjusts prices of goods and services.

“On the issue of salaries and wages, you know that we had a major review in February. As the year goes by, there will be chances for NJNC meetings to look into this issue,” said Prof Mavima.

“We have to also consider our national budgetary processes. Everything will depend on indications from the Treasury and ultimately the guidance of His Excellency the President.”

Year 2022 began on a positive note for the civil servants after the Government extended payment of the US$75 Covid-19 allowance for its workers payable in hard currency from January 1 and the introduction of a US$100 salary being paid in hard currency across the board from March 1.

The Government also waived fees for teachers’ children as part of measures to alleviate complaints of poor remuneration.

Last month, the Statutory Instrument enabling civil servants to import motor vehicles duty-free was gazetted.

The development will see civil servants who meet some requirements put in place to curb manipulation of the system start to import their vehicles free of duty.

According to the SI, Grace B and C in the civil service can import a vehicle with a maximum value of US$3 500, D and E US$5 000 and deputy director US$10 000.

The SI 80A of 2022, however states that the rebate excludes civil servants whose package includes getting a vehicle from the employer.

Last year, civil servants appreciated the Government for paying them their bonuses in US dollars.

Government has said the welfare of civil servants is going to improve and already the Second Republic has been regularly reviewing civil servants’ salaries and benefits for the past four years but inflation has been eroding the gains.

Prof Mavima said the Government is always prepared to listen to the civil servants’ concerns and expectations.

“The Second Republic remains committed to improving the working conditions of its workers and it has been reviewing their conditions of service time and again,” he said.

“Unfortunately, every time there is an increment for civil servants, the price of goods and services go up. But the Government is working on addressing that.”

In the 2022 National Budget, Finance and Economic Development Minister, Professor Mthuli Ncube, projected to spend $340 billion on the wages and salaries for public servants and pensions.

Further to this, the Government will offer a host of non-monetary benefits, which include residential stands, housing and vehicle loan schemes as well as seed money to the Government employees’ Mutual Savings Fund.

Presenting the 2022 National Budget in November last year, Prof Ncube said: “Government doors remain open to structured negotiations with workers’ unions’ for any measures which may improve their welfare and productivity.”