Gono to axe 3 000 Reserve Bank of Zimbabwe workers

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The Reserve Bank of Zimbabwe (RBZ) is preparing to wield the axe on over 3 000 workers, but the bank has no money to pay severance packages.

The unpopular move aimed at pruning the institution’s total workforce from 4 000 to only 600 is likely to spark a labour dispute.

However, senior employees who have been around for over a decade are proving costly to send home.
Finance minister Tendai Biti yesterday confirmed the move.

“The RBZ board has agreed that the bank is over-staffed,” Biti said.
“But how they are going to remain with the right numbers is a technical matter, which they’ll have to deal with.”

The board, he added, has already met and appointed sub-committees, which would oversee the issue of staff, the disposal of quasi-fiscal assets and RBZ debt restructuring.

The apex bank, which did not receive a budgetary allocation to support its operations last year, has cumulated arrears on operating expenses.

It owes local and international creditors more than $1 billion.

Inside sources told NewsDay that various strategies to frustrate employees into voluntary resignation have had limited success, forcing the regulator of banking institutions to recycle staff to and from leave.

The appointment of the RBZ board last month to implement the restructuring and downsizing process following amendments to the RBZ Act, has already cleared the way for the massive retrenchment to take place.

When incumbent governor, Gideon Gono, took over the reins in December 2003, he increased his employee base from about 800 to nearly 4 000.

Most of them were hired to conduct quasi-fiscal operations, which the International Monetary Fund blames for fuelling inflation between 2007 and 2008.

The quasi-fiscal operations grew to about 0,5% of GDP, according to the fund’s Article IV consultation report released last month, but were discontinued last year when the economy adopted multiple currencies.

This rendered idle over 3 000 workers contracted for the many RBZ financial extension services Gono had set up.

RBZ non-core units include Homelink, a bio-diesel project and Foreign Currency Purchasing Centres strewn across the country.

It is hoped these would save the central bank, which lost its power to mint its way back to solvency when the multi-currency system came into force in February last year.

The bank is in danger of losing its assets to creditors who, of late, have been taking turns to make claims.

So far it has lost a number of vehicles, furniture and other assets.

The new RBZ board, which is still chaired by Gono, has a daunting task of balancing the new financial liabilities springing out of the retrenchments with those brought forward from the Zimbabwe dollar era.

The aim of the restructuring exercise, from the fiscal authorities’ standpoint, is to wean the central bank from the fiscus and let it run on revenue flows from its commercial services to the banking sector, particularly national payment services.

The programme is also expected to strengthen RBZ accounting and internal controls and other aspects of governance.