Monday, March 4, 2024

Government commences Debt Swap for all CIVIL Servants, No deduction to be made in next three Months


The government yesterday commenced the process of debt swap across the civil service.

This followed a signing ceremony of the addendum to the current collective agreement on the implementation of debt swap for the civil service between the Government and the Public Sector Unions.

Information and Broadcasting Services Permanent Secretary Amos Malupenga said therefore no deductions will be made from Salaries of all civil servants for the next three months effective immediately.

“All Civil Servants having Loans and advances will get their full salaries for the next three months starting from July,” he added.

Mr. Malupenga said the debt will be owed to their employers in this case government. He said third-party institutions will be directly be dealt with by their employers.

Union Members signing the Debt Swap deal

Mr. Malupenga explained that the Unions have been engaging government help in dismantling the debt burden amongst public Service employees who owe various financial institutions in form of loans for a long time now.

“The debt swap is not a condition of service but an attempt by the employer to mitigate the civil service debt,” he added.

Mr. Malupenga clarified that the debt swap will restructure the debt of the civil service so as to help raise the take-home pay.

And Speaking on behalf of the Unions present, Zambia Union of Teachers (ZANUT) General Secretary Newman Bubala has commended the government for the move.

Mr. Bubala has called on all stakeholders not to politicize the government’s good intentions but work towards providing workable solutions.

He has advised members who will benefit from the initiative to refrain from reckless borrowing in the future.

Mr. Bubala added that the Unions have committed themselves to spend resources to engage their members on financial literacy.

Meanwhile, President Edgar Lungu has said that his government had started working on a debt swap mechanism in early 2020, first beginning with public service employees, in order to reduce the burden on the working class, after noting that even those in employment would be affected negatively by Covid-19 as the cost of living increase due to reduced forex liquidity and disruptions in global trade.

Commenting on a number of other measures to deal with the economic hardships, President Lungu said that this mechanism will see government clear off all payroll taxes for all government employees against allowances such as settlement allowances, leave allowances, gratuities, among others.

“This debt swap will be voluntary. It is expected that households that are currently paying their various obligations will have more disposable income,” the Head of state said..

The president also said that his Government is also looking at mechanisms of introducing a debt swap for those working in the private sector as my government acknowledges that all citizens are equal.


  1. Let’s wait and see what happens after 3 months but I see financial institutions losing out.

    Expect financial institutions to be out of business soon and more debt from civil servants.

    • This is a sign of desperation This move Is not aimed at helping anybody but luring the voters. It’s too late PF is going

  2. The development is welcome but what happens after 2 months grace period? This is not solving the civil servants’ financial problems. How can workers have no accumulated leave days? The whole thing is just another scam by govt. The best would have been for govt to reconcile the loans account to determine the deducted money from civil servants but not remitted to the various financial lending institutions and agree the time frame for liquidation of the debt. Swapping civil servants’ accumulated leave days will further strip them of some future financial security. The accumulated leave days comes in handy when one retires whilst waiting for pension payment and also when one has some family problems can use leave days.
    The union leaders found it fit to even celebrate as though it was a big…

  3. The winners are the finance institutions and the sad thing is that the civil servants will still borrow more money

  4. This is another attempt to win votes from civil servants by the PF party….they have given 3 months why only 3 months …??? The PF knows that that will make the move now not so suspicious. PF we know your tricks…. This year you are losing…HH is winning.


    The debt SWAP comedy is the most interesting desperation for votes by PF and civil servants are not f00ls. PF are not addressing the cause of this problem. IF president Lungu and PF were sensible and had good leadership skills like HH, The first step they would have made is to stop banks and other financial institutions to lend at 49% interest rate. In UK,USA banks lend at between 2-3%. Here our neighbours in Botswana it’s 12%. So this is what they must address first.

    Secondly it’s so shameful to make such a huge agreement without representation from banks and other financial lending institutions. And now they have changed it’s not really a debt Swap but no deductions for three months. Any way who told them…

  6. Any way who told them that they will be there after 3 months?
    Zambians are angry and tired of PF. Balelonga next month.

    Here are some critical questions I want to ask president Edgar and PF dunderheads.

    1. How unfair is it to a thousands of civil servants who disciplined themselves by not contracting any Nkongole, so what is the benefit for these humble hard working citizens in your desperation for votes.

    2. How unfair is it to civil servants you owe settling in allowances, travel allowances, overtime, salary areas, since you claim you have money what do you have to say?

    3. How unfair is it to pensioners sleeping under the tree waiting for their monies?

    4. Why can’t you just deposit money in civil servants account, instead of f00ling them now it’s deductions halt for 3…

  7. Whats the background to these Civil Servants Debt arrears with Financial Institutions? Why were the borrowing Civil Servants not servicing and repaying their loans to Lenders? How did Govt fail to pay Civil Servants Allowances Arrears? So the Majority of the Civil Servants who are not indebted to Banks and Micro Finance Institutions have nothing to gain? Civil Servants Salaries are very low in real terms and have not been adjusted for inflation which now stands at Circa 23% p.a. Why doesn’t the Govt review and increase Civil Servants Salaries in real terms? More questions than answers!

  8. This is a very humane gesture. People’s welfare comes first. We are a people driven party and put livelihood first before profit or money. I love PF

  9. “Commenting on a number of other measures to deal with the economic hardships, President Lungu said that this mechanism…”
    So now he is admitting we have hardships?
    So what happens after 3 months? 3 months is only 5% of 5 years
    How is this being financed again?


  11. I see that this decision is hiper political in this election period.
    I don’t support 100%

  12. À debt swap is a contract btwn the debtor and the creditor. If the creditor does not agree, there’s no deal. So before u even announce a debt swap, u hv to hv an agreement with all terms and conditions negotiated and agreed. So far it’s not clear wht civil servants debts are being swapped with. As always, it’s advisable to read the swap contract agreement so that u know wht u’re signing up for.

  13. KBF writes…..
    Civil Servants, the money they are releasing for debt swap is your money they deducted from your payslips.
    It was supposed to be sent to the bank or microfinance where you got the loan but they never sent.
    They are the reason why you are appearing on CRB reports as defaulters.
    Here is an example.
    You get a loan of 12, 000 from bank A, you are supposed to pay back 1200 (principle + interest) on a monthly basis through govt deduction.
    Now lets come january, you payslip shows a deduction of 1200, february payslip also shows a deduction of 1200 and march the same deduction appears. Each of these months, your net is less by 1200.
    In april you receive a call from the bank to inform you that you have not paid your…

  14. Debt swap my foot…they have not been paying your deductions to the banks and they pretend to come to your aid…these is a fallacy by a reckless irresponsible govt.

  15. You call it desperation? I call it ambushing the enemy and overwhelming him in all angles so that he is so weakend and drained to offer any real challenge. Don’t think PF is joking they want to wrap this up in the first round and get on with work. Who would blame them when the last 5 years has been politics of noise and less on developmental discourse ? There is what is called by any means necessary. We can’t continue on this trajectory as Zambians when we make toxic politics how daily bread for 5 years. Besides these civil servants have suffered the effects of corona so they can get relief of some sort, the details can be worked on along the way and clarity provided for now eyes is August 12th.

  16. It sounds more like a government takeover of civil servants’ debts to microfinance lenders. Government will then recover from civil servants at lower interest rates because its lending arm to civil servants, the Civil Service Microfinance Company, charges lower interest rates. If the way I hv put it is wht they’re doing, it sounds feasible. But I don’t see them pulling it off in one or two months because of the need to work out and audit the actual figures.

  17. Last minute enticements won’t work. People be alert, don’t be deceived again. Where were they all along? Don’t ever forget that the vote is secret, but more importantly protect your vote. Don’t go to slumber

  18. David – Ambushing which enemy? Do you even know where money for this exercise is coming from? Don’t be short-sighted …ask them all how they are going to reduce to national debt.

  19. Trust and Confidence are priceless. Civil Servants know better. U trust the ECL Govt at your own Peril. The Majority of Civil Servants are not involved in the Debt Swap Deal so how many Civil Servants would vote for ECL becoz of the Scheme? Civil Servants have been harassed by PF Cadres, the high cost of living is biting and after the extrajudicial killings by the PF Govt Civil Servants are living in fear of PF Cadre Violence and thuggery. The majority of Civil Servants will not vote for Tribalistic,Corrupt, incompetent and Visionless ECL. They will vote for HH and UPND Alliance for a Change, Peace, Stability and Progress. HH aka Bally will fix it.

  20. David – I hope you are not one of those irresponsible civil servants who got a loan to go and buy a Merc?

  21. So, the thrifty and hard working taxpayer is going to pay the debts of the unscrupulous borrowers.

  22. Lungu is in a panic mode…..but also HH poor finishing so Bandit President Edward Chagwa Lungu will prevail

  23. @ Tarino You must understand that the political environment is a kind of toxic because of these two parties and never think that UPND plays it clean they don’t so they are at each other’s throat until August 12th when the fight ends so as long as they both conduct themselves within a legal framework well and good but of course there is a lot we don’t know and the undercurrent playing out. For the good of the nation one of these parties has to create room so the country can focus on development and my cards are on PF because its a lesser evil between the two.

  24. Hahaha, Another gimmick to canvas for votes. this move sounds like Mealie meal coupons & promissory notes in UNIP days

  25. We have educated civil servants who are being cheated into something which no fault of heir own but PF govt. Ati Debt Swap. This was created by govt’s failure to remit monthly deductions. Civil servants are being held in a tighty corner and the the goverment is pretending toming to their rescue. Ati ichikupenpula echikulya. And useless UNION Leaders are applauding govt as though they (PF GRZ)are doing civil servants a favour.

  26. There is a difference between debt swap and suspension of installments. This can be arranged but the banks/lenders will always calculate the interest during the suspension period. And so when you resume paying, the installment amount will be more than what one was paying before suspension. The bank/lenders smile at such arrangements. My advise to those that can afford it not to suspend because it is just suspension of future trouble.

  27. Mulungushi textiles open for 3 months. NCZ operate for 3 months. No deduction from civil servants for 3 months. No fuel or electricity increments for 3 months. Dollar artificially stable for 3 months. What other goodies are they going to entice us for 3 months? it seems father Christmas only comes to zambia every 5 years.

  28. @ Larry Mweetwa
    The level of interest rates is a reflection of how a government is handling its finances. The countries you make comparisons to, use tax payers money for the intended purposes but PF have used government funds like personal money; they even have the audacity of giving out to people publicly in the markets, they have stolen with impunity without regards to consequences etc

  29. These debts arise from Loan Agreements between individual Civil Servants and the Lending Institutions. So have the Lending Institutions agreed to suspend for 3 months interest and Capital repayments? How come Banks and Micro Finance Institutions are not signatories to the so called Debt/Equity swap Agreement ? This could be a Hoax to buy Civil Servants votes by the desperate PF Govt. How many Civil Servants are debtors in this scheme of Arrangements? We hear $400 million is the amount outstanding to the Lending Institutions. Where is the Govt getting $400 million? Why is the Swap being implemented 26 days b4 the 2021 Elections? Civil Servants are being duped for Election purposes. That wont make ECL and PF win these upcoming crucial Elections. The writing is on the wall.

  30. Kwana Ba PF muli fikopo sana, I though Antonio Mwanza is educted. What do you take civil servant for, you have being failing to remit money you diduct from their salaries to lending institution and today you are talking about debt swap. The first question civil servant with loan should ask chakolwa Edgar lungu is where is your government takes the money you deduct from our salaries and the second whats happens after 3 months? Civil servant you are educated and you cant be used by lungu just because he want to win elections. Nangu matrick you should have used something else.

  31. #24 and #25 tamwakwata ne nsoni mulibapuba sana together with entire PF, just because you get kickbacks doesn’t mean progress for the majority of Zambians. In fact it is always at the expense of taxpayers. Where was PF all this time…..remember there’s no such thing as free money. NO. These PF thugs are in a so super panic mode that they are trying every trick in the book to win or rig August elections. But we people know all about them and they will be found out next month on August 12. Corruption is Negative to development and transparency. Zero……zwitch. And that’s what HH is all about. Zero corruption.

  32. @Razor I love you man… you mean well. PF gotta go.
    ba @David, if you get kickbacks from PF we all can understand why you saying this. But if you a true patriotic Zambian who cares about Zambia and its peoples welfare then you will agree with me that there is no such thing as free money. This is an open ploy by PF to hoodwink civil servants in dire need of such help that the government cares for them for 3 months and then dump them again after elections. Secondly PF is openly campaigning in the form of ‘two’ ‘three’ day working visits when opposition is banned from doing the same. It’s pure hypocrisy….! Vote them
    PF thugs out for good.

  33. This is vote campaigning. While everyone has been banned from campaigning the PF is seriously buying votes.
    Who made the announcement? A political appointee called Malupenga belonging to the PF.

  34. Corruption scandals: 48 Houses Social Security Cash Luxury Presidential Jet Ambulances Fire Trucks Mukula Trees Ndola-Lusaka Rd Malawi Maizegate Fuelgate Swaziland landgate Zesco Loans

    Unbelievable! Just unbelievable!
    So where is this money going to come from? The taxpayer is now going to bailout reckless debt of the civil servants. Has taxpayer agreed to this?
    Have they addressed the problems and conditions that led to such reckless debt in the first place? What will happen when the debt comes right back? Remember the Kwacha debasing bullcr@p?
    Is this now a Socialist state?
    This is just scandalous and a govt devoid of ideas.

  35. Do these people understand the concept of debt? seriously do these people think their debts is being wiped off? If someone is taking advantage of their position to borrow more than they can afford then let them fail if they can’t pay back. After all, these are the same people pretending to borrow but busy stealing public resources. Carry out an audit and see the lavish lifestyles some of these so called civil servants live. Waste of time and resources. If you want to help then give people tax incentives to boost their incomes.

  36. This is what happens if we allow politicians to take advantage of our ignorance. Those 3 months grace period will stop the debt servicing but not the interest. What’s the point of telling someone that you can have a breather but expect to pay more after that time has elapsed? This in my view is a coverup and an attempt to legitimise the theft that has been going on in this Government. Soon they will tell us that the debt will be written off and the winners will be the same thieves who boast to own 70 houses. If you’re serious about wealth creation then make it illegal not to pay peoples salaries on time.

  37. What a clever election plot. HH needs to come out with a plan and say, we will renegotiate all debts, drop interest rates down and implement a new method to shorten loans. If he doesn’t respond, they are done.

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