Veteran economist and former MDC-T Senator Eddie Cross has warned the government that the increment of civil servants’ salaries was likely to fuel inflation and trigger price increases.
He described the adjustments as “poor economics” given the state of the country’s coffers.
“Given the present state of the fiscus, any adjustments to salaries at this juncture would have serious implications on the economy, as it would lead to inflation,” Cross said in an interview with Southern Eye.
“Whatever the civil servants would get today, it would be eaten by inflation tomorrow.”
Aspiring legislator for Bulawayo Central constituency, Watson Nicola, who is an accountant by profession, concurred with Cross, saying any pay rise without budget provision and fiscal space would cause an economic and banking crisis.
“Unbudgeted salary increments mean a bigger budget deficit because fiscus has no space for it. It will be borrowed, meaning the Treasury bill is ballooning, and would ultimately collapse the banking sector,” he said.
The government recently awarded soldiers a 22,5% pay rise, while police officers saw their pay going up by 20% last week, with teachers and other civil servants receiving 17,5 % salary increments.
The salary hikes come amid claims by the government that it was too broke to review the salaries of other civil servants.
Apex Council chairperson Cecilia Alexander last week said she had already written to the government demanding that the rest of the civil servants should be given a 22% salary rise like the soldiers.
She said that they were expecting a response soon, as this was an urgent matter.
Alexander indicated that they had initially asked for a minimum wage of $700 for the rest of civil servants, which the government said it could not afford.
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