Eric Bloch: Govt must admit errors, make changes

GOVERNMENTS the world over, and throughout history, are renowned for their deep-seated convictions in their infallibility, and therefore their unwillingness to admit to error, or to effect any changes to their policies and determinations.

They are imbued with deep, almost psychotic conviction that to effect change represents acknowledgement of fault and, convinced that they are incapable of fault, they cannot make any changes which could conceivably be construed as an admission that they had done something incorrectly.  If change is unavoidable, then they determinedly seek to justify its necessity on grounds of external factors and environmental changes, rather than to have the maturity of openly recognising error and the consequential need for change.
Moreover, when having to effect change, they will invariably do so very reluctantly and half-heartedly.  As a result, all too often the changes are inadequate and ineffective, and their failure to deliver the required results can then be used by government to justify the original policies and dictates, and to emphasise that the demands for change, or policy reversals, were misguided or driven by destructive motives.
Throughout the three decades of Zimbabwean independence, this characteristic has prevailed.  Tragically, despite Zimbabweans now having a so-called “inclusive government”, this continues to be so.  In common with all other governments, Zimbabwe’s government is apparently unable to appreciate that none get it right all the time. It reluctantly embarks upon change and resorts to half measure changes. There are numerous, pronounced examples of this myopic frame of mind, in the current period and the immediate past.  A few examples that can be cited include:

  • Ministry of Finance dictates on the mandatory usage by commerce of fiscalised electronic devices. It is incontrovertible that the measure is a very positive one, which will very significantly ensure Value Added Tax compliance, thereby substantially enhancing revenue flows to the fiscus.  This has been evidenced in numerous other countries, including within the European Union and in New Zealand.  However, the timing for enforcing usage in Zimbabwe is extremely inappropriate. Almost every business is struggling to survive in an environment of very limited consumer spending power, and consequential low revenue flows for businesses.

In addition, money market liquidity is miniscule, resulting in most businesses being unable to access essential working capital.  Therefore, businesses just do not have the resources to acquire and install fiscalised electronic devices at the present time.  In addition, to date the Zimbabwe Revenue Authority has only approved two authorised suppliers of the devices, and the resultant near monopolistic circumstances has rendered the devices very costly.
After endless and widespread private sector representations to government, it has ultimately responded with the usual half-hearted, inadequate modifications of its policy.  It has granted a ludicrously inadequate three-month extension of time within which enterprises are to comply with the mandatory obligation to install the devices.  The prospects of most businesses being able to access the necessary funding in that time are as remote as the prospects of snow falling in Zimbabwe in October!  In addition, the licensing of further suppliers, their importation of the devices, and installation thereof in all prescribed businesses within those three months cannot possibly be achieved.  Government, in line with its norm when it has to make changes, has given a grossly insufficient policy variation to address the situation, dealing with it with characteristic half-heartedness.  An extension to June 30 2011 would have made sense, if the Minister of Finance Tendai Biti’s economic recovery projections have substance.

  • Another prime example of doing too little, too late, is government’s alleged containment of its expenditures to align them with its revenues.  That Biti is striving to achieve a balanced budget, and to achieve performance that is in sync with that budget is most praiseworthy.  But how on earth can government claim to be genuinely pursuing that objective when, on the one hand, it recurrently fails to pay public service salaries and allowances fully and timeously, and on the other hand it funds an expensive travel to the US for the president and 79 others, to attend a United Nations meeting where only the presidential attendance possibly reinforced by the Minister of Foreign Affairs, was necessary.  (Presumably the First Lady needed to do essential shopping for the forthcoming festive season, and equally it was probably necessary for some security and secretarial personnel, but were 80 in the entourage really necessary?)
  • Yet a further instance of too little, too late, was when Biti, in his 2010 Budget Mid- Year Review, magnanimously increase the Pay As You Earn threshold from US$160 to US$175 per month.  Not only was this less than a 10% increase of the then prevailing, appalling low level, but the new level represented approximately 36% of the Poverty Datum Line.  Clearly, Government has no qualms about taxing the impoverished, although it presumably needs to do so in order to fund extensive overseas travels by the political hierarchy!  Even assuming that an average family has two equal income earners, which is highly unlikely, the minimum tax threshold should equitably be US$240 per month, but it would have been out of character for government to do that which was equitable and humanely necessary.
  • For years government has pretended to espouse the principles of decentralistion, and of devolution of administration.  However, the reality is that all material issues are wholly and exclusively attended to in Harare (if attended to at all).  Save for the appointment of provincial governors and resident ministers in Zimbabwe’s 10 provinces, there has been no decentralisation.  Persons living outside Harare Metropolitan Province have no alternative but to travel to Harare if they require governmental actions or decisions on anything of a material nature, even if that materiality is not of major substance.  Ministries’ offices in the other provinces are vested with no meaningful authority. The same pertains to almost all parastatals, with minimally significant issues having to be referred to head offices (which all too often fail to respond!).

If meaningful advancement of Zimbabwe and its people is to be achieved, there is a critical need for a change in the governmental mindset, with recognition that substantial changes are not necessarily negative reflections on the past, but demonstrations of maturity and responsibility.

 

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