HomeNewsZCTU rejects govt’s move to assume RBZ debt

ZCTU rejects govt’s move to assume RBZ debt


THE Zimbabwe Congress of Trade Union (ZCTU) has castigated the move by government to take over the $1,35 billion Reserve Bank of Zimbabwe (RBZ) debt as “satanic” adding that it would further burden the general populace.


In a statement ZCTU secretary-general Japhet Moyo said if the Bill sails through, the duty of repaying will therefore rest upon taxpayers.

“The ZCTU would like to warn the government against overburdening the already overtaxed workers by increasing taxes to fund the debt incurred by the Reserve Bank of Zimbabwe before December 31 2008 with the promulgation of the Debt Assumption Bill,” Moyo said.

“We are assuring the government that we will not take it lying down. The Bill if enacted into law will make the ordinary worker poorer. As ZCTU we will keep guard of our constituency and resist this satanic move on poor worker. Instead the government should reduce income tax bands to cushion workers, but it is planning to suck blood from the skeleton.”

ZCTU’s statement comes as citizens told parliamentary public hearings on the Bill that government not should take over the debt. Rather, citizens said RBZ’s debtor should pay up so that the bank would be able to settle its creditors.

Moyo said government’s revenue base has been shrinking over the years and this has been witnessed by the hiking of taxes, toll fees and the move to collect tax from the informal sector.

“The State will raid the pockets of the underpaid workers, tax the informal economy and increase the duty on basic commodities to pay for its planning inadequacies. Some of the money was used to buy agricultural inputs and machinery which were parcelled out along partisan lines. The RBZ knows who benefited and must ask the beneficiaries to pay back,” Moyo said.

He said the move will be unfair on workers to clear the debt which they did not benefit from.

In terms of the Bill, the State will assume the debts which were incurred by the RBZ before December 31 2008.

“Under this clause, the Minister of Finance and Economic Development on behalf of the State will assume the responsibility for the discharge of outstanding obligation of the RBZ under agreements and instruments of prior debts which are subject to validation and reconciliation,” the Bill read.

According to the Bill, the Debt Management Office, a department of the Ministry of Finance which was set up in 2010, would validate and reconcile the bank’s debts which the government has proposed to assume.

RBZ incurred the debts when it ventured outside its core mandate by engaging in quasi-fiscal activities.

Former RBZ governor Gideon Gono said RBZ’s interventions were extraordinary measures to deal with extraordinary situations.

At the advent of the multicurrency system in 2009, a number of RBZ creditors obtained writs of execution to attach assets.

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