Chinamasa’s Nightmare

Financial Gazette

23 Apr 2015

PATRICK Chinamasa, the Finance Minister, is in an ultimate catch 22 as he struggles to squeeze money out of nothing with apparently no ample legroom to manoeuvre to deliver for the broke country as the nation’s chief budget master.

This comes at a time when some civil servants are calling for his ouster.

With his options having boiled down to either not paying bonuses or retrenching civil servants, Chinamasa’s climb down on suspending bonuses for two years, might see him with no choice but to drastically do the latter.

The Finance Minister’s lofty task to pull resources out of a magical hat came to a head last week when President Robert Mugabe vetoed what he had deemed as an option to create fiscal space by announcing that there would be no bonuses for civil servants for 2015 and 2016.

As if eating humble pie when he had to apologise for making the no bonus decision is not enough, Chinamasa also faces the wrath of some teachers who are agitating for his ouster following what they are calling failure to increase the national pie.

Some economists are also on his back accusing him of not being sensitive to sectors that drive growth in the economy.

That his options are next to nil, in a country that has been in free fall long before he became the country’s exchequer in 2013, is not enough to halt the odds against him.

“Chinamasa must resign,” said president of the Rural Teachers’ Union of Zimbabwe, Obert Masaraure. “He has failed to increase the pie but instead he is just focusing on the little bit of money that is there. He must do more. It is obvious that he is overwhelmed with handling the nation’s purse strings.” Masaraure also told the Financial Gazette that his union was currently in the process of mobilising other teachers’ unions in order to roll out some actions to express their disquiet with their financial woes. Notwithstanding that the President has overturned Chinamasa’s announcement to not pay bonuses till 2017, Masaraure said his union was taking that with a pinch of salt and so would continue with their plans to express their frustration over the country’s inability to provide for them reliably. “We are not taking the President’s words. Until we see a Cabinet circular on us getting our bonuses we are not taking that.“So we will continue with our plans to do a peaceful march and other actions. Chinamasa has failed to harness the potential of diamonds’ proceeds and also there are industries which could open which Chinamasa is not taking advantage of to expand the national pie,” Masaraure said.

While other teachers’ unions could not be reached to get their comments on the same, economist John Robertson also expressed disappointment in what he called Chinamasa’s lack of support to key sectors.
“The Minister should be much more supportive to activities that make money for the country. We need business activity — the country is not making money at all,” Robertson said, adding, “He (Chinamasa) has to fix the problem and encourage investment.”

Political analyst, Nhamo Mhiripiri, weighed in on the matter saying, “Something definitely has to be done to cut down on the expenditure.”

Local pressures are not the only ones he has to fend off. The Bretton Woods lending institutions expect him to cut the country’s wage bill as a sign of commitment to free fiscal space in order to service outstanding debt to the International Monetary Fund and the World Bank, before the two can consider re-engagement.

Although there had been some reluctance to retrench civil servants amid some planned resistance to that measure from various quarters, former education minister, David Coltart told the Financial Gazette that Chinamasa would have to cut down either travel expenses, perks or civil service.

“Chinamasa is in a fix. He is in the ultimate catch 22. He does not have much legroom. The President has cut off one of his solutions and he might have to cut down on the staff, which is equally unpopular. The same as not paying bonuses,” Coltart said. “This puts Chinamasa in a very difficult position.”

Coltart said in view of government contradiction on the issue of bonuses and the need for way forward in cutting expenditure, Chinamasa needed to have some robust debate with his government colleagues.
“He needs to have vigorous debate in government; He has to fight for his corner. And they are going to have to make one of other very difficult choices,” Coltart said.
Government has been left badly exposed after backtracking on its decision to do away with the annual bonuses.

The boob left many wondering how the current administration sets about executing its duties as it talks right and yet walks left.

The scrapping of bonuses had set the stage for a showdown between civil servants and their employer.

Unions had warned last week of a deterioration in service delivery standards, moonlighting and low morale among the workers — which would have undermined government’s efforts to turn around the sector which is just able to keep its nose above water.

The bending over backwards by government on its decision on bonuses effectively means that the plans that civil servant unions had set in motion to challenge the scrapping of the 13th cheque also fall away.
Aggrieved civil servants’ unions were said to have consulted regarding filing a lawsuit against the current administration for unilaterally suspending bonus payments until 2017 without consultation.
This is in addition to other routes that unions had been considering such as go-slow and a major strike action, if government had resisted overtures to come to the negotiating table to explain its unilateral actions.

With schools set to open in two weeks’ time for the second term, civil servants appeared to hold a vantage point in as far as bringing pressure to bear on the government as a crippling strike action would have brought the education sector onto its knees.

Sifiso Ndlovu, the Zimbabwe Teachers Association (ZIMTA) chief executive, said they already had begun consulting their members extensively on what steps to take, before President Mugabe’s intervention.
“Unions were getting legal and economic intelligence on what to do, which was to establish if government was legally justified under the Constitution to do what it had done. The first stop was going to be the negotiating table, but if they were not coming forward to that then alternative routes would have been sought and these (routes) are legal and economic,” said Ndlovu.
“But the matter has been resolved now and that is a relief in terms of guaranteeing the rights of workers. Information Minister Jonathan Moyo downplayed the row over bonuses this week and said the issue was finished.

“The bottom line is that bonuses for civil servants have been reinstated as directed by the President and they will be paid accordingly. There’s nothing to debate about that. Full stop. End of the story,” said Moyo. — Additional Reporting by Ray Ndlovu
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