Is Chinamasa the fall guy?

Daily News

22 APRIL 2015

Finance minister Patrick Chinamasa is caught between the proverbial rock and a hard place, with the unenviable burden of having to defend President Robert Mugabe’s political irrationality while dismissing the economic wisdom of his earlier decision to suspend civil servants’ bonuses.

The 91-year-old publicly rebuked Chinamasa at Independence Day celebrations on Saturday, emphatically denying that the State had scrapped bonus payments to civil servants in the next two years.

This came a mere week after Chinamasa, accompanied by his Information counterpart Jonathan Moyo, had announced at a media briefing in Harare that Mugabe’s broke government would not pay bonuses to civil servants this year and next year — a move that was to be reviewed in 2017, ahead of the country’s national elections slated for 2018. Curiously this fiscal matter was announced from the Information ministry not the Treasury boardroom.

The announcement was also made without the ministers of Labour or chairman of the Public Service Commission. In preparation for the trip to Washington DC for the 2015 Spring Meetings of the World Bank Group and the International Monetary Fund, the Finance minister made a bold announcement which indicated a serious intention to cut down on recurrent expenditure.

But speaking at the National Sports Stadium, the nonagenarian flatly denied that his government had made such a decision, leaving Chinamasa and Moyo with egg on their faces.

Mugabe did not say where the money will come from, but nevertheless promised that civil servants will still get their bonuses. This also comes as the same government struggled to pay the previous year’s bonuses.

Mugabe claimed bonuses for civil servants were a right that was curiously not linked to individual or general economic performance. Alex Magaisa, a former advisor to former Prime Minister Morgan Tsvangirai, said it shows populism was getting in the way of economic wisdom.

“In fact, the irony of all this is that while he (Chinamasa) is now saying his decision was a mistake, the reality is that in explaining the so-called mistake, he is in fact giving solid reasons to justify it,” Magaisa said.

Chinamasa admitted in lickspittle State media that he had made “procedural mistakes” when he announced the decision to scrape bonuses.

The Finance minister said he had been forced to make the announcement in response to the economic problems Zimbabwe was facing and the ever-shrinking national purse.

“In the process we have tripped and made some mistakes and I am happy that His Excellency in his speech at the independence celebrations has corrected our mistakes and in a manner has lifted us back to our feet,” Chinamasa said.

Magaisa said the long and short of it was that government does not have money and its sources of revenue are shrinking with the ever-contracting economy.

“Where does the government get the money when it struggled to pay last year’s bonuses?” Magaisa asked.

“Companies that operate on a commercial basis cannot afford to pay bonuses so government must be realistic about bonus payments.

“But of course government cannot afford to take away bonuses from the soldiers and other sensitive sectors of the civil service. They want to bribe workers into thinking they still care. They want to prevent the build-up of a reservoir of disgruntlement among its workers. But economically it makes no sense for a father to insist on eating meat when he is not bringing home any meat.”

Magaisa said Chinamasa had gone to Washington DC with a promise to the IMF and World Bank to reduce government expenditure “but his boss made a fool out of him and embarrassed him while he was there.”

“A proper professional would throw in the towel and defend his honour,” Magaisa said, referring to Zimbabwe’s former Industry minister Nkosana Moyo appointed in July 2000 who resigned in May 2001 after publicly speaking out against attacks on businesses and factories by war veterans.

After Moyo resigned, he took up a position at the World Bank’s International Finance Corporation.

The former banker with Standard Chartered was not a member of the ruling Zanu PF party, but was brought into the government as a technocrat to lend its economic policies some credibility with the International Monetary Fund.

Mugabe had urged Moyo not to resign but attacked him as lacking spine when he spurned him.

Magaisa said: “But these guys will never dream of doing that.”

David Coltart, a former Education minister in the GNU, said Chinamasa has been forced to eat humble pie by Mugabe.

“If Chinamasa acted without authority on such a major issue, he acted grossly irresponsibly. As we have seen his announcement was met with alarm and despondency within the civil service — this was no small issue. In most governments a minister would lose his job for behaving in this manner, but one can guarantee Chinamasa will keep his.”

Coltart said it seems implausible that Chinamasa acted arbitrarily.

“He is an intelligent man and in my experience always followed Cabinet protocol,” said Coltart who served with Chinamasa in government between 2009 and 2013.

“In other words, he is not a person who has a track record of acting unilaterally. Furthermore, Chinamasa’s decision was announced several days ago and economists were rolled out by the government controlled press to compliment him for the decision — saying that whilst it was a tough call it was the right one. It is hard to imagine that the tightly controlled Zanu PF propaganda machine would have acted in this way if there wasn’t a broad consensus that this policy be implemented.”

The former Education minister said one is left with the inescapable conclusion that Chinamasa is just the fall guy.

“Whatever the case, President Mugabe’s directive leaves Chinamasa between a rock and a very hard place,” he said.

In his statement published in lickspittle State media yesterday, Chinamasa speaks about a ballooning debt within the civil service including Premier Service Medical Aid contributions not being paid and government’s failure to meet debt repayment undertakings, which he was hoping to address by not paying the bonus.

“Zanu PF has run Zimbabwe like a tuck shop; money has been taken out of the till and never banked; sound decisions have been reversed for short term expediency; there has been a failure to implement long term economic plans,” Coltart said.

He said that was why the IMF and World Bank suspended support for the Zanu PF government in the 1990s — long before “sanctions” were ever imposed.

“Its failure then to comply with agreed policies that exasperated the international financial community,” he said.

“President Mugabe’s announcement this weekend, whilst Chinamasa was in Washington doing his best to woo the same community, will elicit a profound sense of deja vu in the IMF and World Bank.

“I have absolutely no doubt that Chinamasa timed his statement on bonuses to coincide with his visit — to show the IMF that the Zimbabwe government is serious about tackling government spending and debt. President Mugabe’s statement will have driven a coach and horses through Chinamasa’s attempt to get further international support for the government.”

Chinamasa returned from the IMF’s spring meeting this past weekend not only with egg on his face, but with empty pockets too, Coltart added.

A financial analyst with a local bank said: “There is total chaos in government. These guys are clueless including Chinamasa himself. If he believed so much in what he was doing, he should have resigned.”