Finance minister Mthuli Ncube has come under heavy fire after signalling his intention to acquire vehicles for the country’s lawmakers as well as paying the thirteenth cheque for government’s 550 000 strong civil service, the Daily News can report.
While speaking on the state of the economy in Bulawayo last week at a pre-budget seminar for parliamentarians, Ncube promised to purchase vehicles for members of the National Assembly and Senate, who number up to 350.
This could cost anything upwards of $50 million.
Ncube also said he will look into the payment of civil servants’ bonuses, saying government workers should be rewarded for their hard work.
He said: “So, I won’t say what will happen with bonus this year yet, but you can be sure that we are going to do something that will be a thank you to those who have worked so hard through the year, but at the same time, cognisant of the need to tighten our belts.”
Analysts canvassed by the Daily News yesterday said the Finance minister was contradicting himself by calling on the generality of Zimbabweans to tighten their belts while at the same time pampering Members of Parliament and civil servants with cars and bonuses.
This is despite the fact that the fiscus is already heavily depleted and that Treasury has had to resort to levying an additional two percent tax burden on electronic transactions to shore up the national purse.
Currently, over 80 percent of the national budget is consumed by salaries, with very little going towards critical national development projects such as funding the country’s infrastructure needs.
To balance its books, government is borrowing at a huge cost, resulting in the widening of the budget deficit currently estimated at $2,9 billion from $1,4 billion last year.
Analysts said government’s generosity has absolutely no basis except that it is trying to please civil servants who are already agitating for better pay after the rising cost of living eroded their salaries.
Professionals in the education and health sectors are already calling for payment of salaries in United Stated dollars, a demand the Public Service ministry is still to respond to.
South African-based political analyst Ricky Mukonza said it is surprising that a cash-strapped government is promising civil servants bonuses.
“Its possible sources of money could be; printing more bond notes, it could also be from the two percent tax they are charging on electronic transfers,” he said.
While Mukonza sees this as meant to endear government with the civil servants, he said in the bigger scheme of things, it would worsen the already bad economic situation as government is spending what it does not have.
“What makes it even worse is that the spending is on recurring expenditure,” opined Mukonza.
Renowned political analyst Piers Pigou said this is indicative of a government that is unwilling to reduce its expenditure.
He said it is unfortunate that government had taken that decision at a time it should be reducing its workforce.
While it is difficult to retrench, Pigou said there still is no explanation on the ballooning number of civil servants in 2012, in which reportedly over 200 000 more added to the pay roll.
“This is indicative of a government that is not serious about cutting down on its expenditure that is taking almost 95 percent of the budget. This has to go down. It is a simple as that,” said Pigou.
Maxwell Saungweme, a political analyst, said government was bending over backwards to achieve political and economic stability, which he said is critical in its re-engagement efforts with the international community.
He said the introduction of bond notes, the printing of money through the Real Time Gross Settlement system and the deals being struck with the private sector were all part of measures being implemented to bail out government.
“So if buying MP cars and paying civil servants bonuses are variables for the stability function of the regime, then they will be supported to do this to gain that facade and veneer of political stability. More bond notes will also be printed,” Saungweme opined.
This comes at a time the Finance ministry has adopted the Transitional Stabilisation Programme (TSP) to achieve President Emmerson Mnangagwa’s vision of making Zimbabwe an upper middle-income economy by 2030.
Among other things, TSP aims at taming public expenditure, especially wage bill containment, while stimulating investment.