Maravi

(NEWZIMBABWE) Biti defiant on public sector salaries

Biti defiant on public sector salaries
by
05/05/2010 00:00:00

FINANCE Minister Tendai Biti on Tuesday defiantly insisted there would be no pay increase for civil servants in the short term, just days after Morgan Tsvangirai told May Day unionists there was no ban on public sector pay rises.

"Until we grow the economy, the government has no capacity to pay its workers. From 1997 to 2008, normal production was devalued to 24 percent and until December 2008 there was no economy to talk about,” Biti told journalists at a press conference.

"At the moment, the government is not making money from tax and industry is not producing so we have little fiscal space. What we need to do is to expand the little cake that we have by rebuilding the economy," Biti said.

The Finance Minister was strongly criticised by leaders of the Zimbabwe Congress of Trade Unions last Saturday. In a surprise move, Tsvangirai told thousands of workers at the May Day celebrations that Biti’s stance on civil service pay was “not government policy”.

“As far as I am concerned, the government did not announce any wage freeze,” Tsvangirai said, “There is no government policy on wage freezes.”

Biti says despite civil servants currently earning an average US$170, their wage bill takes up 70 percent of the government’s revenues – about US$1 billion over the last year.

And last week, he described the situation as defying “normal economics”, adding: “Given the lack of fiscal space, the government will maintain a cap on the current wage level whilst attending to other revenue enhancing measures.”

The public row between the two men has been seen as a window into internal power games in their Movement for Democratic Change (MDC) party ahead of a congress next year at which all key positions will be contested.

Labels: CIVIL SERVANTS, NEOLIBERALISM, SALARIES, TENDAI BITI

posted by MrK @ 4:56 PM