A CABINET committee has been set up to explore ways to reduce government’s unsustainable wage bill gobbling up more than 80% of revenue and will present its recommendations within the next two months, a cabinet minister has said.
Labour minister Prisca Mupfumira told the Zimbabwe Independent in an interview this week she and Finance minister Patrick Chinamasa are spearheading the committee to reduce the salary bill which is hampering critical capital expenditure programmes such as building of vital infrastructure, roads, power stations, dams and airports.
She said the committee has held meetings with various ministries including Agriculture, Health, Education as well as the Judicial Services Commission and uniformed forces.
Chinamasa said last year that recurrent expenditure had chewed up a staggering 92,5% of government revenue with wages accounting for 81,5% of income, leaving just 7% for crucial capital projects.
“We have told them (ministries) to look at the number of people they are employing and establish what it is they are being employed for and to look for areas where there is duplication,” Mupfumira said. “We cannot continue with the current situation where more than 80% of revenue is going to the wage bill.”
She said the committee would also look into various issues, including allegations that the civil service is bloated by ghost workers, and had set itself a deadline of two months to report back to cabinet with recommendations.
“Cabinet did not give us any timeframes for coming up with recommendations but we have said to ourselves that we will not go for more than two months without proposing a way forward on reducing the wage bill,” said Mupfumira.
The labour minister, however, warned that whichever option government would settle for will involve taking painful surgical measures to bring down the astronomical bill.
This is in line with recommendations by the International Monetary Fund under the Staff Monitored Programme (SMP) — which is in its second phase — to government to cut the wage bill, inevitably through retrenchments. The second phase of the programme began in October last year and ends this December.
The SMP is an informal arrangement between a country’s government and the IMF to monitor the implementation of the government’s economic programmes.