Zimbabwe will spend $180 million to pay the 2016 bonuses for its workers over five months from April following a crunch meeting with union leaders today, staving off a crippling strike.
Civil servants had planned to go on strike today over payment of 2016 bonuses, traditionally paid in November.
The cash-strapped government had previously proposed giving the workers residential land in lieu of cash, an offer which they rejected outright.
Minister of Public Service and Labour Prisca Mupfumira told reporters after the meeting that government had agreed to pay cash bonuses to its 298 000-strong workforce.
“We have agreed on a position and we are going to be paying our civil servants their bonuses staggered. We will start with Defence and Health in April followed by Police and Prisons in May, Teachers in June then the rest of the civil service in August,” she said.
Finance Minister Patrick Chinamasa, who was also present at the meeting said the payments will total $180 million.
Asked how the government — which is already struggling to meet its workers’ basic pay — would finance the bonus payments Chinamasa shrugged off questions only saying that “government will certainly mobilize the resources”.
Chinamasa has twice tried to scrap the bonus as part of measures to deal with a mounting budget deficit which reached $1.2 billion in 2016, only to be publicly embarrassed by President Robert Mugabe who reversed his proposals.
The government’s wage bill gobbles up 90 percent of its total revenue and payments for the 2016 bonus are likely to worsen the budget deficit for this year, initially estimated at $400 million.
“The demands that we brought are still up for discussion but the issue that we were clamouring for, which is cash payment for the (2016) bonus has been accepted,” said Raymond Majongwe — who leads a teachers union — in a video posted on his Twitter handle.
“They (government) should have paid us last year. The government has an obligation to pay us our bonuses, we are not happy about the delay. We are going to communicate with our members to finalise the way forward,” he said.
At the weekend, the state also gave in to most of the demands of health workers.
Doctors went on strike on February 15 to press for more pay and in protest against poor working conditions.
Their strike was last week joined by nurses at public hospitals, who walked out of work to push for 2016 bonus payments and to push for improved working conditions.
Zimbabwe currently has about $2.1 billion worth of treasury bills in the market, issued to bridge the government’s funding gap and clear the central bank’s debt and analysts said the state is likely to again dip into the local market to pay for the bonuses.
“Government is settling obligations by creating even bigger obligations. But the effect of such mindless borrowing will only be felt in three to five years time,” an economist said.
Government has been keen to avoid a strike by its workers after such action last July prompted the biggest protest against Mugabe’s rule when it was complimented by grassroots protest groups using social media to organise a successful nationwide shutdown.
Mugabe, who last week flew to Singapore for what his officials said was a ‘routine medical visit,’ made a brief stopover in Harare yesterday on his way to Accra, Ghana for that country’s 60th independence anniversary celebrations.- The Source
