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NewsDay

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Govt suspends 2015, 2016 civil service bonuses

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GOVERNMENT has suspended civil servants’ performance bonuses for this year and next year as it seeks to tame its ballooning wage bill and create fiscal space.

GOVERNMENT has suspended civil servants’ performance bonuses for this year and next year as it seeks to tame its ballooning wage bill and create fiscal space.

by PAIDAMOYO MUZULU

Announcing the development in Harare yesterday, Finance minister Patrick Chinamasa said the position would be reviewed in the 2017 National Budget.

Chinamasa said government was still to complete payment of 2014 bonuses, while at the same time struggling to raise the $260 million monthly salary bill.

“Government has decided to suspend bonus payments for the civil servants in 2015 and 2016, and the situation will be reviewed in 2017 in the event that we are able to build enough capacity,” Chinamasa said.

The government had a tax obligation of $172 million in 2014 and still has to pay $13,4 million owed to State universities’ staff.

Chinamasa said the government was “committed to paying all the outstanding bonus obligations” and bemoaned the collapse of the formal economy and the rise of the informal sector that was difficult to tax.

“I would want to clearly state that as government, we would be more comfortable with a situation where revenue growth is driven by an expanding tax base instead of continuously changing the tax policy,” he said.

At its peak, the country had two million workers in formal employment, but the figure has shrunk to a paltry 500 000 in the last decade.

Chinamasa said the suspension of bonus was only but part of the bold measures the government would employ to reduce government recurrent expenditure in addition to staff audit and channelling of more resources to infrastructure development.

“We have been exploring a number of measures to contain recurrent expenditure and channel resources to less capital-intensive and high-impact Public Sector Investment Projects like irrigation schemes and completion of the Tokwe-Mukosi and Gwayi-Shangaan dams that create real jobs,” he said.

The Ministry of Public Service is conducting a new civil service staff audit although the 2010 Ernest and Young (India) audit report has not been made public nor its recommendations implemented.

The report said there were 75 000 people irregularly employed by the government soon after the 2008 general elections.