1 August 2014

Zimbabwe: Govt Maintains Freeze Despite Mugabe Vow

GOVERNMENT will maintain its freeze on employment in the civil service to cut costs despite President Robert Mugabe's recent encouragement to open posts in the health sector.

In a letter dated 1 July 2014 to the International Monetary Fund (IMF) managing director Christine Lagarde, Finance minister Patrick Chinamasa and Reserve Bank governor John Mangudya said the country will maintain an employment freeze introduced two years ago to manage the growing wage bill.

"We will maintain the hiring freeze in Government which started in July 2012, while allowing some limited flexibility in filling critical vacancies that cannot be filled through internal mobility," Chinamasa and Mangudya said.

However Mugabe, who earlier this month during a visit at Harare hospital to see two-month old twins which had been separated through an operation , said posts in the health sector should be unfrozen.

"We were talking about it the other day that we should not freeze any posts in health at all," Mugabe said. "Look at the country as a whole, the need that we have across the country on health for health facilities, for health care, to get to each and every village that is when we say we have no money? We cannot say we have no money when it is there from the soil."

They also committed to the Bretton Woods institution that they would be granting just one salary adjustment in 2014 just as they did last year. This development puts paid to Mugabe's promise that civil servants will be paid PDL linked salaries this year.

"The 2014 budget provided for an 8% increase to the overall wage bill. Following the conclusion of negotiations in the National Joint Negotiating Council in January 2014, the overall wage bill is projected to increase by 14 percent this year," they said.

"The larger increase resulted from the need to make good on the government's election commitments. We have already identified cuts in non-wage-non interest spending, relative to the 2014 National Budget Statement in order to completely offset these wage increases."

Economist Eric Bloch said the minister and the central bank governor were presenting the facts as they could not pay what they did not have adding that this would disappoint the more than 200 000 civil servants.

He said the IMF will judge Zimbabwe by the government's actions and not Mugabe's pronouncements.

The freeze is likely to worsen the high unemployment rate now estimated at about 90%.

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