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National dialogue on Zimbabwe’s economic recovery needs a lot more than a lot of platitudes or grandstanding. It needs serious discussion on ends, ways and means and practical ideas on how to achieve these as we try and build and national consensus, at least on the essentials.
Here, business can play a major role. Everyone in business wants a more prosperous Zimbabwe, with economic growth. And everyone in business can do the simple arithmetic unlike some politicians and shouting analysts who appear to have skipped lessons in the earlier grades of primary school. The objective has to be to solve problems, maximising the upside and minimising the downside in all trade-offs, rather than scoring points.
But, with that proviso, there is a vast space where serious debate, quantifying proposals and seeking realistic and achievable policies, is both possible and necessary.
By quantifying proposals we mean something more than just making a vague statement. If someone states, for example, that the Government must cut the number of civil servants, then that person should use the Estimates of Expenditure that must be presented before Parliament to list which civil servants in which ministries and then give the total savings.
Those making those statements will quickly find that this is not a simple option, simply because almost everyone on the public payroll works in a handful of ministries. To take just one example, the Ministry of Finance and Economic Development; this is one of the more important ministries and just about everyone thinks we need it. But the numbers are low. Mbare, a single Harare suburb, with its three high schools and a plethora of primary schools almost certainly has more civil servants teaching in those schools that the entire Finance Ministry staff, even when units like ZimStats and the Salary Services Bureau are included.
It is the same with most ministries apart from the big half dozen. Many are tiny, as basically they have just a co-ordinating and planning role rather than running major operational units. So unless you want to close down a lot of schools and colleges, close down a lot of hospitals, stop helping farmers feed the nation, stop issuing birth, death and marriage certificates and ID cards and passports, close the courts, put the violent criminals back on the street, stop giving police protection and disband the defence forces, there are not many options that will produce savings of more than 1 percent.
But if someone has a good idea let us hear it, but let us also see the figures that underlie the suggestion rather than just some vague cliché repeated ad infinitum. Business people know what we mean. When companies are making changes on cutting costs everything is carefully calculated.
We need the same attitude when we look at Government revenue. If a tax is to be cut we need to know what service will be cut, or what alternative tax is raised to replace it, along with realistic calculations. If Government spending is to be raised, with pay increases for example, we need to know where the money is coming from. And the answer “Print it” is the wrong answer.
The debate in Parliament on the National Budget was disappointing in this respect. The opposition could easily have probed spending budgets and could easily have moved amendments to substitute one tax with another. They would probably have lost the ensuing vote, but at least we would have been presented with alternatives.
However, all they did was oppose without offering an alternative. In many countries opposition parties go as far as stating what their National Budget would look like, which admittedly opens them up to the same examination processes that the Finance Minister faces when he presents his budget. But still, the function of an opposition is not to scream “No, No” but to present a different vision and a different set of proposals.
And when people give advice they should be prepared to defend that advice, or change their minds if new data shows that something else is required. For example it is now fairly common knowledge that the banking sector was enthusiastically in favour of separating nostro and RTGS bank accounts. Now these advisors are lying so low in such deep shadows that no one can even see a trace of their interventions. That is wrong. They should be ready to help measure the upsides and downsides of their advice and change their minds if necessary.
It is the same with the general business consensus on fuel pricing. Everyone knew that fuel was generally too cheap but that some flexibility was needed for fuel used for productive purposes. That was the dual policy announced by the Government of higher taxes that could be refunded if the fuel was used to create wealth not burn foreign currency for fun.
Interestingly on fundamentals there is already a lot of consensus. Finance and Economic Development Minister Prof Mthuli Ncube has made it clear that he will not enter deficit financing to pay the daily bills. Opposition spokesman Mr Tendai Biti puts it more dramatically when he says that the minister should not eat what he has not first killed. But basically those are identical policies. And the business sectors, along with their preferred economic advisors, have always been horrified at the total willingness of the old Mugabe governments to borrow or even print money to pay recurrent expenditure. They know that if they did that they would end up in the bankruptcy court.
And that consensus means that we have to cut expenditure, although there are severe limits, and increase revenue. The result is austerity while the economy grows because with growth, the Government’s take will grow as well. So it can do more with a smaller percentage of the national wealth.
The trouble, of course, is that while everyone can agree that austerity is needed, many feel that they should be specially exempted. But the real world cannot operate like that. But we can encourage ideas, we can test proposals, we can act sensibly.
What we should not be doing is pretend that a magic wand will make everything OK. It will not, since there are no magic wands outside fairy tales and we do not prance around with fairies but live in a real world.
Bongani Ndlovu