Emoluments for senior Zesco workers very high - Konga

Emoluments for senior Zesco workers very high - Konga
By Chiwoyu Sinyangwe
Wed 05 May 2010, 22:50 CAT

ENERGY minister Kenneth Konga yesterday admitted that emoluments for senior Zesco employees are still very high as he supported calls by the power utility to raise electricity tariffs by 36 per cent.

Zesco has applied to Energy Regulation Board (ERB) for an average tariff adjustment of 36 per cent for the year 2010/11 in order to continue on the path toward cost reflective tariffs.

The move has, however, received resistance from key industry players who feel it would not only pose a threat to the macroeconomic stability in the country but also push up the cost of doing business.

But Konga, during the Zambia Chamber of Commerce and Industry (ZACCI) breakfast meeting for chief executive officers, said there was need to raise power tariffs in the country to secure future investments into the sector.

Konga admitted that increasing tariffs for electricity, which contributes an average of 30 per cent to operation costs of most industries would erode the profitability and efficiency of most companies.

“I am aware that a lot of members of ZACCI have opposed the electricity utility Zesco going towards cost reflective tariffs, but we need to swallow the bitter pill of increased tariffs because at the current tariffs, the industry will not be assured of future power,” Konga said.

Konga observed that there was need to keep a tab on the high emoluments Zesco pays its senior employees.

Konga was reacting to Zambia State Insurance Corporation (ZSIC) Group managing director Irene Muyenga who expressed concern that there was an ambiguity in the actual dynamics driving the high cost of financing the operation cost of the domestic electricity sector.

“Is it the cost of distribution or supply or the remuneration of employees that is driving the cost in the electricity provision?” wondered Muyenga.

In response, Konga said: “government is aware that Zesco staff costs are very high and it is important that ERB takes into account the monetary component when deciding on the Zesco application. Consumers must not be seen to be increasing the payroll at Zesco.”