Civil servant pay hike will not destabilise economy – Prof Ncube

Professor Mthuli Ncube

GOVERNMENT’s proposed 40 percent salary increase for civil servants will not destabilise an economy that has been on a positive trajectory over the last few months, Finance and Economic Development Minister Professor Mthuli Ncube has said.

Cabinet announced yesterday that it had awarded a 10 percent risk allowance for teachers while proposing a 40 percent salary increase for civil servants which will result in the lowest paid employee getting over $14 500.

The new salary structure is with effect from November 1.

With the local currency standing firm and inflation on a downward trend since the Government introduced a cocktail of measures which include the Foreign Currency Exchange Auction, Prof Ncube said the latest increases would not reverse the gains made over the last few months.

“We’re making sure that the ordinary civil servant can be as close to the Poverty Datum Line as possible. So, for example for a teacher that salary of above the Poverty Datum Line. That’s what we’re trying to achieve and we will be able to do this without destabilising the stability. In fact, when you look at the ratios, in terms of the salary to total revenue ratio per month that won’t move much. At the same time, it would have given the employees a decent wage, a wage that is a real increase. You’ll agree with me that when a currency is stable, inflation is falling, an increase in wages is a real increase and that’s a good thing,” he said.

Prof Ncube said the latest increase was meant to close the gap, between the bottom of the pyramid in civil service to the higher rungs. Salary increases as the year came to a close, Prof Ncube said, could be beneficial to the economy.

“I think that extra demand from the economy and wages from consumers is not a very bad thing. We also want to make sure that there’s enough demand to support the economic growth that we need to move our country forward,” he said.