THE Government’s offer to public service workers for improved salaries and conditions of service will be minimal to avert shocks in the national economy.
Finance and National Planning Minister Alexander Chikwanda said the Government was constrained to offer a high salary increment because of ‘tight’ fiscal space.
The minister was speaking during a meeting with World Bank managing director Sri Mulyani Indrawati at his office in Lusaka yesterday.
Mr Chikwanda said if the Government offered high salaries, it could trigger an upsurge in the inflation rate and also affect service delivery in the social sector and other areas of the economy.
The Government would, however, be reasonable in addressing demands from workers’ representatives in the on-going negotiations.The current collective agreement with the trade unions in the public service would expire at the end of this month.
The minister said the Government was under intense pressure from the Zambian people to deliver on economic development, job creation andsalary increments against the compelling need to avoid economic shocks.
[pullquote]Mr Chikwanda said if the Government offered high salaries, it could trigger an upsurge in the inflation rate and also affect service delivery in the social sector and other areas of the economy.[/pullquote]
Mr Chikwanda said the downgrading of Zambia’s economic performance by the Fitch Rating agency was irregular as it was based on the decision to reverse the sale of 75 per cent shares in Zamtel from Lap Green Networks of Libya.
He said Zambia’s economic outlook remains favourable and that the fight against corruption was meant to restore confidence in the investors.
Global rating agency Fitch last month downgraded Zambia’s economic outlook from stable to negative.
Mr Chikwanda said the new Government would establish economic policies that were predictable, consistent and credible, which the fight against corruption sought to achieve.
Responding to a question by Ms Indrawati who wanted to know what was being done about the outcry from some members of the community, Mr Chikwanda said ‘careless’ salary increments would be avoided.
“People have become vocal because they want us to deliver. We are under pressure but we must act quickly. Bureaucracy must be turned into quick action,” Mr Chikwanda said.
He said the future of Zambia’s economy did not entirely depend on high copper prices but diversification and that Government would not consider introducing windfall tax in order to protect mining companies.
[pullquote]“Windfall tax pre-supposes that the wind will blow your way all the time and this means that we will tax the mining companies out of business. Right now the price of copper at the London Metal Exchange has gone down,” Mr Chikwanda said.[/pullquote]
“Windfall tax pre-supposes that the wind will blow your way all the time and this means that we will tax the mining companies out of business. Right now the price of copper at the London Metal Exchange has gone down,” Mr Chikwanda said.
He said the six per cent mineral royalty tax was adequate while efforts to promote diversification in the country were ongoing. He said a technical committee headed by Secretary to the Treasury Fredson Yamba had been constituted to streamline operations of the Public Private Partnership secretariat.
Mr Chikwanda said Bank of Zambia had delayed to rebase the currency because the Government had directed that it should follow the law and refer the process to the Zambia Public Procurement Authority.
He said service delivery in Zambia was being hampered by bureaucracy, which he said also existed in the donor community with some projects not taking off on time.
Ms Indrawati said Zambia was performing well compared to other countries but urged the Government to be more careful on the fight against corruption to avoid negative effects on the economy.
She said the World Bank would render all the necessary assistance for the Zambian government to meet the people’s expectations.
[Times of Zambia]
The sort of commentary that I expect more of from the new government though I am not sure if this is consistent with PF policy as the Principal sees it….
bwanji uko. yaba
I support this man. He is the only most valuable and precious drop in this ocean of Kaponyas we have in power and wish him all the best. Listening to him gives me a lot of hope for the direction of the economy.
Though bad and not acceptable, this is the part where I think bembalisation or nepotism is working well because Sata can’t fire Chikwanda because they are relatives and he respects him.
If he was a nobody, these Kaponyas would have thrown him into the fire and raided and raped the treasury with their silly More Money In your pocket nonsense.
As I have said Inflation hurts the poor more than the rich and it needs to be watched very carefully.
Good luck Sir, in selling the idea to the Kaponyas you oversee.
quote: ” I support this man. He is the only most valuable and precious drop in this ocean.”
That line I support the rest you are showing MMD caderism. Lets ignore such I am not PF but i want Zambia moving forward. We all know this government is nepotistic, it was expected.
Ba swine muletasha and not ukuponta m******mwe! You Mad Dogs brought poverty to this country and introduced children to the streets. The country is shambles because of the MMD and you keep insult PF! fo olish indeed!
Of course this is expected salary increments can only be within the national economic framework and fiscal policy. This is not to say there will not a decent salary incremenent but that Government will act within prevailing economic parameters.
One point people need to take into account also is who the Minister was addressing, the World Bank is particular about the percentage of the wage bill of any countrys GDP and so that message was re-assuring to him, they know the campaign platform on which the PF won the election.
ok lets be fair to each other. Can you all resign from govt so that we the voter can also consider giving you minimum votes to avoid your governance shocks.
Ah, I voted for more money in my pocket. How will it come? Hey, workshops bane, we have no option! More workshops please, three in a day i attend half a day and get paid for all the three! Way to go. The minister has contracts to rehab state house, lodges etc over and above his huge salary and allowances. Watch the space.
You id!ot, you really believed that “More money in your pocket” nonsense? Now you know that you were lied to!
I feel for sensible people like Chikwanda because they thought they would be pragmatic in party of hot-heads who only act on emotion. Sorry Chikwanda you will soon be fired for not toying the PF populist policies. You should have worked for sensible Rupiah.
Trying to define the word ‘minimal’.
Im NOW confused. Very Confused. Kambwili a few moons ago claimed health workers have been given 100% salary Increament. Now Shamenda was rumour mongering that there is a 4% Salary speculations from people that the Govt., has offered the Civil Servants (that includes Health Workers). So who is telling the truth? Now this from Mr. Chikwanda. Aaah Nalema manje.
The truth is that there shall be no salary increment over 4% for civil servants. All that 100% was just hallucination by Chimbwili.
Sorry bene there is little the Govt can do on the matter under the circumstance. Just work a little harder, malipilo alikumwamba.
Reality sinking in
This man is sensible and consistent on several economic pronouncements.
Maybe Chibamba Kanyama’s remarks can be respected now tho the words are coming from a different person with a different position
you are very right bululu….the guy was called FAKE ECONOMIST i remember very well
CHIWAMILA GALU. FULFILL YOUR CAMPAIGN PROMISES. YOU SAID THERE IS MONEY WITHIN NINETY DAYS. ZAMBIANS READ BASIC ECONIMICS ON THE NET. INFACT ECONOMIC SIMPLY MEANS HOME MANAGEMENT. IF YOU CAN YOUR HOME ECONOMIC THEN YOU CAN MANAGE NATIONAL. TAKE A LOOK AT THESE GUYS AND HOW THEY HAVE MANAGED THERI HOMES – ADULTERY, DIVORCE ETC. OPEN YO EYES ZAMBIANS. KE KE KE KE KE KE KE KE KE KE KE KE KE KE KE
Another light wrist slap. Translation. We want you to fight corruption kids but your methods are little too out of the box for us, however we’ve got your back :) AC sounds sensible. Hope lives on.
1) His company (Apollo) was single-sourced to renovate State House. 2) He picks on only why reason for the Fitch downgrade and yet they gave several reasons – in fact only half of the one reason. 3) Economic policies that were predictable, consistent and credible? Or lack of them. This is one of the reasons for the downgrade by Fitch. 4) Bank of Zambia had delayed to rebase the currency because the Government had directed that it should follow the law and refer the process to the Zambia Public Procurement Authority – So did they initially intend to do so without following the law, did they need to be directed to follow the law? Really funny but I’m not laughing.
The reality of running govt sets in. And, oohhh, the shame of getting into power by blatant lying!! Chikwanda please keep it up. We don’t want Zambia to be ruined by impulsive kaponya-seeking policies. Now that you have their vote, they can go to hell – until the next election. We demand a minimum 7.7% GDP growth rate this year, which requires pro-business policies. Kaponyas can continue street vending in their “new jobs”.
Dude, you speak well but your name is from the devil. Any chance of changing it?
yayayayayaya..pf wawa..you have failed to deliver lamentably..come someday soon..you will be history!!ba Chikwanda warn your friends to be careful with their utterances..
They were deceived they would receive a 100% increase, donchi kubeba
Ok, then give them 3 ngwee each.
thats sounds okay we need the economy to be driving GDP at 7 % at the end of the year bravo chikwanda just give them 10%.
chikwanda save ths pf stupidity by providing leadership
Ms Indrawakuti is trying to say that ‘a bit of corruption’ is also good for the economy. Kwati muchele, anga wabikisha fyalula, anga taubikile futi fyalubana. I’m qouting the words
“Zambia was performing well compared to other countries but urged the Government to be more careful on the fight against corruption to avoid negative effects on the economy”
3.9% increament will be ok for civil servants,afterall they plunder national resources but service delivery is below per
Totally true i agree 3.9% that is a good offer for civil servants! I see them driving around in GRZ vehicles using tax payers money to pick up their families at school take their wives to work and church… and me the tax payer i struggle to survive!
its good that the hon minister has now realised the advise of mr chibamba kanyama on the abnormal salary increasement. and also Dr situmbeko musokotwane mentioned the increase of inflation
Y is the person speaking enjoying a hefty salary himself if such salaries do hurt the economy? Give me a convincing response! Napapata sana mwebantu bakwa lesa!
Ba kaboke ba ku kasumbalesa…..
Iwe KAMBWILI waona boza…..Chikwanda is a sober thats why he acts when Ukwa is out performing somewhere else!
If civil servants can only receive 4% increment in order to avert inflation, what effect will the 15 – 19% increment in mining companies have on the economy? Kambwili and other government minsters want private investors to increase workers’ salaries to reasonable amounts but the same government doesn’t want to take a leading example. Its really donchi ….
PF= ZP (Zabwino Palibe)
I support Mr Chikwanda. But my only worry is consistency.. if you give a minimal wage increase to a civil servant and still continue having bye elections every month, we may loose a lot of funds which could have gone to building this country….
Hopefully he will not be contradicted.
Thats likely
We need the savings Minister thank u, but am worried the reaction of civil servants hmmmmmmm yizabuka
Back to reality
i am liking lots of things coming out of the mouth of this man. he is expressing skill and intelligence. i don’t expect him to agree with fitch that is only nature given his position. when usa, france and others were downgraded his counterparts cried just like him today. but shit is shit. and fitch was right because despite that the economy is growing, the reckless actions of PF make zambia a dangerous place to do business even for zambian. and that is what fitch was saying.even most of these PF politician, they will acquire money and invest in housing in UK, Ireland and SA becuase these place are safe
shatalamona po?…hear, hear, hear, hear,hear.hear,hear,hear
“Mr Chikwanda said if the Government offered high salaries, it could trigger an upsurge in the inflation rate and also affect service delivery in the social sector and other areas of the economy.” I stated and I quote. So you want us civil servants to sacrice. Let it start at the top not just leaving the civil servants to sacrifice alone. A good leader is honoured by his people if he starts by showing an example to its citizen.
GET STUFFED IWE CHIKWANDA YOUR BOSS HAS NO RESPECT FOR ANYBODY!!
am not suprised with this talk,typical of people who are busy fattening their pockets with the little that pool people contibute through taxes.y shud it be civil servants to pay the price for miss placed priorities that those we intrust to run this country`s affairs commit out of selfishness and gridy? am yet to hear any of the ministers to forgo their salaries and other luvshis benefities in a sprity of humanity.the unemployed and highly taxed civil servants (500-700 in formal employment) are always affected by the high cost of living.
people lets demand for those sweet promises asured to us 6 months ago…. else lets give them a tast of donch kubeba come 2016.
What his saying makes sense, another way to go about it is to increase the minimum wage by small increments for the whole country in stages, that way all the stake holders benefit, the inflation rate and economy can be monitored to see the effects whether negative or positive and even the employers will be able to cope easier with the change.Not forgetting the employees who will be getting more money in there pockets. :)>-
IIt`s the other way round. It`s the salary increases that are not keeping up with inflation. The kwacha is so devalued that it`s buying power is diminished. You spend so much for less. A comparison, taking a low wage of $2000/mth in USA, an average wage increase of 3% (2011/2012) = $60. In ROSS, this can dress you from top to bottom in designers. However, the same percentage for a salary of K2, 000,000(probably above average by Zed stds) = K60, 000. Of what value is this? Mr. Chikwanda, People were sanguine about your budget. Consequently, give them what they deserve; something decent. What about the inflation in your pocket from the Sate House Remodeling contract. Yes, we truly need to diversify and not continue putting our eggs in one basket, namely copper exports,
because fortunes do change and the fact that copper is a wasting asset. However, it`s a wonder if PF has the zeal, will and intellect to pursue this. Looking through the crystal ball, pundits are warning that, unless China undertakes some serious structural changes, it`s economy may slow down and eventually, the bubble will burst. Unfortunately, due to our leaders `myopia , by allowing our economy to be mostly dependent on copper and most of it if not all imported by China means that our market vanishes in thin air if China`s economy came to it`s knees.The sky then falls on Zed. Mr. Chikwanda`s rhetoric on diversification can not go without being challenged. As Finance Minister in the UNIP era, he was one of KK`S Advisers. These guys failed to take advantage of our hey days then
as a booming copper producer to diversify our economy but instead, embarked on the detrimental Nationalization, a repulsive policy which saw many companies including Manufacturing (which we now badly need) relocate to other countries with favorable investor policies. In the 70 `s when our kwacha was still strong, these guys came up with some development programs, one of them being 2nd National development plan meant to develop rural areas which failed lamentably. Now, with the Kwacha so devalued through the roof, Manufacturing is costly because raw materials have to be imported
This man really understand the net grits of economics. How i wish we had a president who understand the economy of the country and that way he would know that economic development is more than just cheap talk and threats. Chikwanda, you are the man! Hopefully we have people from the labour force who understand economics so that as they bargain the remain as realistic as possible.
Very wise words indeed minister of finance.
hope we are not going to have another bunch getting k45 million kwacha while the rest you accuse imflation for their salaries to increase.
CAN LUSAKA TIMES CONFIRM THAT SATA HAS GONE TO INDIA.IF TRUE WHY.IS IS IT FOR BUSINESS OR HEALTH CHEACK.WELL INDIA IS SUPER FOR MEDICAL TREATMENT.LET US HOPE AS ZAMBIAN WATCHDOG HAS EXPOSED THIS STORY IS NOT TRUE
“Mr Chikwanda said the new Government would establish economic policies that were predictable, consistent and credible” When is Chikwanda`s government going to establish the so-called economic policies? PF is a bunch of ignorant people who have no clue. By now Chikwanda should be talking about the economic policies that his government has designed and undergoing im,plementation process. PF are stuck! They are lost! This is 21st century and the likes of Mr. Chikwanda are a misfit. Zambia under PF is headed for crisis.
I’m looking forward to the next set of promises to be made for the 2016 elections. Of course being the Zambians that we are, we will have forgotten about the past and shall walk naked in the streets to celebrate the winner. After which, of course, we shall be ‘temporarily shocked’ when the pie in the sky promises are broken. And read as die hard supporters remind us that these were campaign gimmicks which should not be taken seriously.
There is one politician who has tried to advocate for such promises to be made into contracts of sorts which politicians will be held accountable for. I dare not say who it is… it might make the idea into a bad one.
Those rubbish zambian salaries are not even inflation adjusted, in effect every month your getting less and less.
am a civial servant…. He may be talking sence but minimal is NOT the WORD the won votes for PF. 4% from 100% does not even define minimal…. Its MINUTE!!!!
Announce da 30% then,da sooner da beta.
No money in your pockets.
PF too much lies that it hurts listening from you. You liad during campaigns and you are still doing so now in govt. Need not worry Mr Veep with no appointment to such an office, unwritten rule that you are the Acting President since current Veep is not trust weathy. By the way PF supporters it looks like your pockets this time around will be much drier than during RB’s time. 4% of K1.6m who has the calculator using log of 10. it may help give a better figure. PF show them throgh Dochi kubeba that they shall be poorer.
” “Windfall tax pre-supposes that the wind will blow your way all the time and this means that we will tax the mining companies out of business. Right now the price of copper at the London Metal Exchange has gone down,” Mr Chikwanda said.”
Is this man retarded? If copper prices go down, so does the Windfall Tax. That’s why it’s called a *Windfall Tax*. It taxes *Windfall Profits*.
Of course, when copper prices go down far enough, so does turnover, and with it the mineral royalties tax, wich is a tax on turnover.
The difference is, that right now, the Windfall Tax would collect the taxes that are owed under the Variable Profit Tax which is in effect right now, but are uncollectable because the mining companies fudge their books, and don’t report their profits.
Which is called Tax Evasion, and this is a crime, for which they should lose their licenses.
Why is Mopani still operating? They were caught ‘transfer pricing’ (money laundering) their profits to a subsidiary in Madagascar.
Guy Scott said it all so well, in his article in The Post, “Getting Our Pound Of Flesh”. Of course, that was before the elections.
” THE Government’s offer to public service workers for improved salaries and conditions of service will be minimal to avert shocks in the national economy. ”
Oh yes, the dreaded ‘wage inflation’. Which is a nonsense argument in a country where most people earn $1 per day, an economy which is characterized by an absence of cash.
We’ve seen this neoliberal garbage before, and I for one didn’t accept it when it came from Situmbeko Musokotwane.
People did not vote for more of the same. This guy really needs to get out of the way and let a progressive economist have a go.
Text book economics!!! The reality is that the economy will not grow unless people have money to spend. Underpaying people shrinks the economy and stunts growth. Chikwanda should study modern economic strategy. See what developed counties are doing to achieve economic growth. Some of the economics principles you studied 60 years ago are no loner valid.
It depends whose textbooks he has been reading. At least he should read Ha-Joon Chang, instead of Milton Friedman. Although having an independent mind would be nice.
” ” “Windfall tax pre-supposes that the wind will blow your way all the time and this means that we will tax the mining companies out of business. Right now the price of copper at the London Metal Exchange has gone down,” Mr Chikwanda said.” ”
If the Finance Minister doesn’t understand the mechanics of the Windfall Tax, he should a) refrain from commenting on it and b) reconsider his position as Finance Minister.
Unless of course he is just lying to protect the mines from being taxed.
Even intelligent people sound like fools when they are trying to defend the indefensible.
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