Civil servants bonuses economic death knell

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The news that civil servants will start receiving their bonuses at the end of this month should come as good news to public workers, but this could be a death knell to the moribund economy.

By paying civil servants their 13th cheque, government has assured pleasing one of its key constituents, but on a pragmatic level, this could be economically suicidal in the long run.

In all honesty, the government does not have the money and cannot afford the payments and the most realistic thing would be to suspend bonus payments until the economy is back on track, whenever that would be.

For the sceptics, do not take our word for it, but let us do the maths to see if government can afford to pay.

In the first half of the year, the Zimbabwe Revenue Authority (Zimra) set itself a target of collecting $1,76 billion, but managed $1,66billion.

With a reported 80% of this revenue expected to go towards salaries, it means the government has little or no room to manoeuvre.

If the government goes ahead with paying bonuses, as promised, bonuses and salaries will gobble about 160% of Zimra revenue, money the authority does not have, and the tax body has failed both in the first half and third quarter of this year to meet its revenue collection targets.

Without belabouring the point, the government simply has no money to pay bonuses and paying them now betrays a sickening failure to look at future implications.

While the government may get the plaudits in the short-term, in the mid to long-term, paying the bonuses will have untold effects.

Zimbabwe is already saddled with a bloated civil service and there are efforts to trim it, yet government interventions like audits and retrenchments are often piecemeal and ad hoc.

We understand that any disquiet from the civil service, particularly from the armed forces, is unwanted and not good for the government, but we believe authorities should have been up-front and honest in explaining the country’s economic situation and how this affects their bonuses.

Patrick-Chinamasa

It would be one thing for the government to pay bonuses this and next month and fail to pay salaries or government dues in future months.

If this were to be the case, then civil servants will become restive and the populist idea of paying bonuses will inevitably show government’s inadequacies.

In April, Finance minister Patrick Chinamasa, seemingly the only voice of reason in government, announced the practical solution of suspending bonuses, but got a reprimand from his boss, President Robert Mugabe.

As the man in charge of the country’s finances, he knew the dangers of paying bonuses and sought to do what was best for the country, but the voice of reason was dulled by populist self-serving rhetoric.

We are not saying workers should not be paid their 13th cheque, but by definition, a bonus is a payment made after a corporate or government has met set targets and is not mandatory.

Zimra have missed most of its targets, the government missed its gross domestic product projections and most companies were forced to retrench, as the economic woes continue to bite, therefore, where are the authorities getting money to pay bonuses?

25 COMMENTS

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  2. Mr editor you are very wrong on this one. This government clearly has lots of money to pay bonuses. Your maths is based only on revenues released from Zimra, but this government runs a parallel structure whose figures are not for public consumption and all revenues from diamonds, ivory and rhino horn sales go into that account. Civil servants know about that and that is the purse where their monies will come from. My editor you are dreaming if you think this present government will resciscitate this economy. If they managed to survive 2005-2008 they have no reason to worry about the present.

  3. very true @chisaga. remember when they were able to pay people when biti was saying there is no money. there is a zimbabwean govt and the zanu government and the zanu govt has more money than the zimbabwe govt. infact they have so much money and you will see it being splashed out soon during the 2018 election. there is so much happening in this mafia we wont believe it when comes in the open.

  4. For the time being they can juggle their finances and pay the bonuses to all civil servants. They have got the money to do this. They can borrow locally or print the bond coins but in the medium to long term they will worsen the situation. With the prospects of another drought 2016 will be hell. No new money from abroad will be available to finance civil service salaries. They are heading for a train smash but they do not see it and do not care. They think they will fix it as they go but time is running out. The economy is shrinking and revenue collection will decline further. Instead of reducing expenditures they are ignoring reality and hoping some how money will fall from heaven like manna. Time will tell!

  5. Editor munonyepa mari iripo govt will not reveal all its sources and will not fail to pay salaries in the near future. These guys may not have a clue on how to revive the economy but they are not dull, they know how to survive. Remember what civil servants earn is pocket money for their kids

  6. 100% chisaga. the civil servants are doing their work daily and deserve the bonuses. the source of the bonuses should be the headache of machonyonyo Patrick china_masa, not that of the civil servants. Mugabe has hired 60+ ministers yet he knows that he bears the responsibility of paying he civil servants including bonuses so he should come to the party and pay them their bonuses!!!

  7. Mr. Editor, are you basing your analysis on Gonomics or what? Are you telling the world that civil servants are non productive at all hence do not deserve what is rightly due to them? Is it the civil servants’s fault that the powers that are failing to manage the fiscus. Buddy be reasonable, is it the civil servant’s fault that the powers that be are appointing a blotted and unwarranted cabinet? Mr Editor give us a life!!!! Think before you pen.

    • Patrick
      Possibly you should read the article carefully and take time to understand BEFORE you comment.
      At any rate your language wil not win you many friends.

  8. there is a very simple solution to all this. why cant the government allow certain institutions to run themselves. Polytechnics, Varsities, hospitals etc problem solved

  9. Mr Editor

    Your analysis is really on the surface on this. The incremental cost of a once off bonus payment to our certainly critical sivil servants would cost the government just 160 million out of a roughly 4 billion dollar national budget and then you call that a dearth knell on the economy?. This kind of screaming journalism is as needless as its unhelpful.

    It is erroneous for anyone to imagine that denying the civil servants bonuses irrespective of the paltry salaries they get would play the magic wand in reviving our economy. This economy needs structural transformation and a disgruntled civil service would not help that situation. I would listen to you if you said there is need for government to cut expenditure elsewhere e.g foreign travel and motor vehicles so that the bonuses are not financed from any unsustainable source.

  10. True Mr reporter your maths is very wrong. I am not a maths person but the assumption that the bonuses will gobble 160% of revenue does not add up. Salaries take 80% of government revenue because they are paid every month. Bonuses are paid once in a year, and I am at loss how these can add another 80% to make the 160% that you are talking about.

  11. I am not a maths person but what is clear is that bonuses are a once off annual payment. True the salaries gobble up 80% of the government revenue. How then does a one off payment eqaul to a one month salary constitute a further 80% to come up with the 160% that you are talking about. Talk of screaming journalism!!

  12. As long as Grace is busy donating government funds as if its her personal money at useless campaign rallies & Mphoko is blowing away taxpayers money with his grand children in Rainbow Towers, the civil servants must be paid bonuses without fail

  13. The editor is very much lost. He or she an agenda with civil servants. How much is this bonus if not a monthly salary as 13th cheque so where does the 180% come from ? Be realistic how much are civil servants salaries ? Tikwanire.

  14. Civil servants must get their bonus. Especially the pow-grades staff work very hard to keep this country going in very difficult circumstances. Government should however start to trimming expenditure by reducing unnecessary travels and ridiculous benefits to senior civil servants, e.g. expensive cars, houses, etc.

  15. Bonuses should paid based on a performance criteria. What is the performance of govt in 2015? GDP has collapsed to -1.2%, unemployment is 90%, companies are closing daily, no money, power load shedding etc.They aref paying these bonuses coz it is an entitlement. Money to pay the bonuses is easy to find. Govt can either borrow locally or just print the bond coins as they please. Govts do not get broke. They find creative ways of making money and live for the day!

  16. paying bonuses is not mandatory, and doing this in Zimbabwe given the economy which is paralysed is a recipe for a socio-economic tragedy.

  17. Sithole and Stanley if you had a business generating $10 000 a month in revenue and you had to pay $8000 per month in salaries…………if suddenly one of the months you had to pay $16 000 towards salaries , that would surely translate to 160% of the monthly revenue generated. Hope it now makes sense!

  18. Its simple the money needed by our country is supplied as per need. Money for bonuses and salaries will always be available whenever it is needed. Only God has sustained this economy and will remain faithful to His word. Whether you call it broke gvnt or rich!

    • May you please donate your bonus to ZIMRA to help Zimbabwe go Mr Editor then we will walk in your footsteps. May you also donate part of your salary kuZIMRA wosara ne500 gross inotambira macivil sevants tione kuti uramba uchinyora zvakadai futi here? Isu tikashaya bonus our kids may not make it to school next year. Please advice govenment on how to raise more money kwete kuikurudzira hurumende kusabhadara citing draconical laws dzekuti its not mandatory.

  19. You bullshit editor. Stop that nonsense ok. Ziva zvokureporta zvepolitics dzenyu usiyane nemari dzedu, wanzwaka!! You are not a civil servant, you earn your monthly salary from that paper and mostly hefty bonus package by the end of the year from your company. So please stop that rubbish reporting about civil servants bonus. The economy is just in bad state and not those lies you report daily kuti the civil servants are killing the economy. That is stupid of you and all your reporters.

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