FINANCE minister Mthuli Ncube yesterday said government had now resolved to review civil servants’ salaries after every three months to hedge against runaway inflation rate.
Ncube announced the policy shift in the National Assembly during debate on the Second Reading Stage of the Finance 2020 Bill hewed from the mid-term budget review statement he presented in Parliament recently.
Yesterday’s sitting also marked the last day of sitting for the National Assembly as President Emmerson Mnangagwa is now expected to issue a State of the Nation Address (SONA) and a statement for the official opening of a new Third Session of the Ninth Parliament.
“We are also reviewing salaries as I speak now, we reviewed civil servants salaries and gave them US$75 allowance and US$30 for pensioners and there is a newspaper article today which I will not comment on, but our policy is, we will review salaries after every three months,” Ncube said.
“We are re-considering risk allowances to restore purchasing power of civil servants’ salaries to ensure their income is not eroded and to stabilise the purchasing power.”
His comments came after Harare East MP Tendai Biti and Hatfield MP Tapiwa Mashakada (both from the MDC Alliance) castigated the overtaxing of poor people by Ncube and erosion of salaries by the dual pricing system and inconsistent monetary and fiscal policies.
Mashakada said: “The $5 000 tax-free threshold should now be $25 000 because of inflation. There is need to periodically review non-tax income rather than wait for the midterm budget review or annual review.”
Biti said that since Ncube took over the Finance ministry in September 2018, he had intoxicated people with a plethora of taxes that are harmful, spreading inequalities, and placing a burden on the taxpayers through the 2% transaction tax.
“If you impose 2% to Ziyambi Ziyambi (Justice minister) who stays in Borrowdale and to my mother in Dotito the two are not equal. My appeal is, move away from unprogressive taxes.
“On Statutory Instrument 133 of 2019 which de-dollarised the economy what happened is that the minister devalued civil servants’ salaries, including salaries of MPs which cannot buy a full tank and yet in the community you are an MP but you are dishonourable,” Biti said.
He said the dual pricing structure was promoting inflated prices and choking consumers, adding that there were policy inconsistencies where there are proposals by Ncube through Statutory Instrument 29 for motorists to pay vehicle licenses in US$ and carbon tax to be paid in US$ when on the other hand he refuses to dollarize the economy.
Biti said the foreign currency auction system was a fraud as there was only one player the Reserve Bank of Zimbabwe auctioning, while other big companies were selling money illegally on the streets, and the country was losing a lot of revenue through grey imports brought by buses from South Africa at Road Port.
Zanu-PF chief whip Pupurai Togarepi praised Ncube saying that, “we cannot increase income beyond what we are able to finance. If we play around with taxes, we increase disposable income and low-income people will benefit from this tax regime.”
Ncube refused to dollarize the economy saying: “I suggest that we have more Zimbabwean dollars in your pockets than foreign currency.”
Meanwhile, teachers have expressed anger over government’s position to extend the US$75 cushioning allowances until December saying the only way forward must be complete dollarisation of their salaries.
The government position arrived at early this week after a meeting with the Apex Council.
However, Takavafira Zhou, the Progressive Teachers Union of Zimbabwe president yesterday insisted that the educators would continue demanding nothing short of US$520 salaries.
“The so-called NJNC between government and Apex Council on September 9 was a high sounding nothing.
“We are sure teachers still remember the February 2020 Victoria Falls romance betrayal and futile promises that negotiations would continue. Yet as we highlighted then, there has not been any negotiation since February, “Zhou said.
“Now that government wants to open schools prematurely, it has conveniently called for its usual firefighting antics with Apex Council. Worse still, Apex Council’s term of office has long lapsed and the Alexander-Dzatsunga-led team has no locus standi, let alone traction.”
Zhou slammed the Apex Council for agreeing on the extension of the cushioning allowances instead of forex-indexed salaries.
The PTUZ leader urged teachers to confront government for better salaries.-NewsDay