Govt wage freeze will stay

MINISTER of Finance Alexander Chikwanda says Government will use the two years of a freeze on upward wage adjustments to plan for better emoluments for public service workers and tackle salary imbalances currently prevailing in the Zambian civil service.
Mr Chikwanda explained that the freeze was in no way meant to harm Zambian workers, who have recently received a huge wage hike of more than 100 percent, the highest since independence.
Mr Chikwanda said Government will not rescind its decision to enforce the two-year wage freeze in the public service as negotiations for improved conditions of service between Cabinet Office and the labour movement continue.
The minister said this in Lusaka yesterday when he featured on Zambia National Broadcasting Corporation Radio Two Government Forum programme.
“We are taking into account serious imbalances in wage structures for the public service. We want to try and see if we can tone down on those imbalances, those inequities.
“We are going to plan over this in 2014 and 2015 and defer salary adjustments to 2016 when we will have a better prepared plan,” Mr Chikwanda said.
Mr Chikwanda said Government decided to freeze wage adjustments to enable it to take measures that are in the interest of public service workers.
The minister said the civil service is slightly bloated and cannot be used as a mechanism to create more jobs.
He said Zambia cannot continue with glaring inequities and that there will be no fiscal space in 2014 and 2015 to increase salaries.
Mr Chikwanda said increases in salaries for civil servants this year are quite substantial.
He said the 200,000 jobs Government anticipates to be created in the next two years will be in the private sector.
“The budget this year is K10 billion bigger than the budget last year…there has been a tremendous increase in the emoluments,” he said.
The minister said the wage bill for public service workers has increased from K11 billion in 2012 to K15 billion in 2013.
Mr Chikwanda said this means that 52 percent of locally generated revenue would be spent on salaries for civil servants.
“This is why, with due humility, we suggested a moratorium so that we can put things in place. One of the cost overruns related to maize subsidy is that we are carrying on the burden of K1.3 [billion] into the 2014 fiscal year,” he said.
He also said foreign investment is still coming into Zambia and that the international investment community still perceives Zambia as a positive investment destination.
“There is a lot of investment pouring into the country and it is estimated around US$5 billion and the bulk of it is in the mining sector,” he said.
He said Government has continued to create a favourable investment climate in the country by simplifying company registration procedures.
Mr Chikwanda said Zambians should take advantage of the good policies Government has put in place to invest and improve their living standards.
He said Zambia has all the necessary facilities to do business but some have chosen to engage in unnecessary politics which do not benefit them.
“Zambians must stop this excuse of blaming it on Government for not being an adequate facilitator. They should just work and strive a bit harder, have creativeness and vision,” Mr Chikwanda said.
Civil servenats recently received a more than 150 percent salary hike.