The Employers’ Confederation of Zimbabwe (Emcoz) has proposed a lean Cabinet of 15 ministers and the removal of deputies, as part of a raft of measures to contain runaway costs and grow the economy.
BY BUSINESS REPORTER
In his mid-term fiscal policy review statement, Finance minister Patrick Chinamasa said government would cut 25 000 workers, cancel 2016 bonus payments and salaries for ministers to contain costs, which gobbled 97% of the revenue collected in the first half of the year.
In an analysis of Chinamasa’s statement, Emcoz said the review was a long overdue acknowledgement by the government that the country cannot continue to spend money it does not have. It said if the 25 000 jobs to be cut were from the lower echelons of the civil service only, the impact would be minimal.
“Emcoz proposes that all government ministries be conflated to a maximum of 15 and all deputy ministerial posts be declared redundant,” it said.
There are 31 ministers excluding provincial affairs ministers. and 20 deputies.
Emcoz said all State enterprises have to be commercialised, while statutory entities and local authorities have to be run on a sustainable cost recovery basis. It said government should also resist populist measures, which place intolerable burdens on the economy.
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Chinamasa also proposed to trim diplomatic missions saying that would lower employment costs to $232 million per month by June 2017 and $219 million by December 2017.
Confederation of Zimbabwe Industries president, Busisa Moyo welcomed the cuts on government expenditure, adding that Chinamasa should be more bolder and cut deeper in true reform style.
He said the biggest supply side interventions pending right now were stimulating demand towards local production and funding for re-tooling.
“This was mentioned, but definite time frames are required for the $324 million needed and finally the cost of doing business,” Moyo said.
He said Chinamasa’s review had no prescriptions to resolve the cash shortages plaguing the nation.
“The disappointment is that he didn’t shift the country to the South African rand. He should issue the 2017 annual budget in rand, a signal to move to a softer currency and deliberately compare number for number with South Africa to weed out inefficiencies,” Moyo said.
“The United States dollar is crowding out efficiency, productivity and competitiveness and facilitating corruption. It’s more of a resource or store of value than an operating currency. Business expected him to move school fees, wages, parastatals charges, levies and so on, to rand,” he said.
Moyo said this would allow the country to benchmark its costs correctly and spur on production in agriculture, mining, tourism and manufacturing.
