Civil servants took the decision to accept the cost of living adjustment that the government proposed that would see the lowest-paid worker earning ZWL$1023 per month. The equivalent of US$99.51 using the interbank rate. This comes after what can only be described as protracted negotiations that started at the top of the year. The increments will be between 55% and 76% depending on the employee level.
Apex Council chairperson Mrs Cecilia Alexander while speaking on the acceptance of the offer provisionally mentioned that they will continue to negotiate with the government for an improved wage. Rumours of this being the position the civil servants were going to take had been floating around over the last two weeks.
The civil servants want a wage of ZWL$4750 (US$462) and this will continue to be benchmarked against the interbank rate. There is quite some space between the current offer and what civil servants require and we have to consider if there is fiscal ability in the ministry of Finance to even begin to accommodate workers without resorting to borrowing or worse still the printing of money.
This latest increment may however not bode well for the nation as the IMF with which Zimbabwe has a Staff Monitored Program, recently cautioned government against a salary hike for civil servants. The IMF argued that government expenditure on wages was too high and as a result, the nation would struggle to make any meaningful moves such as investing in infrastructure if wages continued to take up so much of expenditure. On the other hand, civil servants were quite evidently incapacitated as workers were earning as low as US$581 (US$56.51). There is also concern over inflationary pressure. With inflation such a runaway horse that the finance minister saw fit to stop announcing the year on year inflation figures this increment will likely heap more pressure on prices.
How much this will affect the overall budget and surplus, if we still have one, is hard to ascertain. Finance minister Professor Mthuli Ncube could not be drawn on the size of payments to the civil service or the size of the civil service by journalists in an interview. While this increment has not come with an absolute figure to give us an idea of the cost to the nation of this increment.