Price increases mustn’t be arbitrary

In Zimbabwe, Government is the largest employer and when its workers are underpaid, the market will be depressed on one hand, while on the other, there will be a hive of activity in the economy when civil servants are adequately remunerated.

For some time, the majority of the civil servants have been receiving salaries below the poverty datum line ($600) and this has been affecting service delivery in the public sector.

The majority of Government workers would spend part of their productive time searching for alternative ways of sustenance.

Although that can be at times difficult to prove, reports abound that besides stealing the employer’s time, there are some workers that have been involved in a number of shenanigans that also cost their employer materially and financially.

There are some workers who spent almost half of their time daily, knocking on other people’s doors, selling some wares ranging from clothing, perfumes, cooked food — the list is endless.

Others were always off sick travelling to neighbouring countries in search of wares for resale at home to supplement incomes.

It is also critical to highlight that their counterparts in the private sector are surviving below the poverty datum line — where controls are too stringent — have been worse off.

This calls for the private sector to take a cue from the Government and also economically empower their workers with salaries above the poverty datum line.

Government should be saluted because despite the hard economic environment characterised by low foreign currency inflows through foreign direct investment and export receipts and high unemployment among other things, it made a huge sacrifice and awarded its employees a $400 million cost of living adjustment. The adjustment is with effect from April 1, 2019.

The increases are from 13 to 29 percent depending on the grades after negotiations with the civil servants body, the Apex council.

The latest figure is an increase from the $350 million Government had offered to its employees. The cost of living adjustment is also in addition to the $63 million once off allowance civil servants received during the first quarter of 2019.

Public Service, Labour and Social Welfare Minister Dr Sekesai Nzenza said Government together with civil servants had agreed on the $400 million offer and this would be reviewed again in June.

According to the Minister of Finance and Economic Development Professor Mthuli Ncube, the latest allowances culminate to about 29 percent adjustment that will see the lowest paid civil servant taking home over $600. This figure according to Government is above the poverty datum line though others argue it is now at around $800.

Whatever the arguments proffered might be by different players in the economy, the move by Government will have far reaching consequences to the economy.

By injecting such an amount into the economy that will also be reviewed until the next budget next year, we expect to see major activities in the economy as hundreds of thousands of civil servants expend the money monthly.

However, our greatest worry is the conduct of our business community that has developed a serious penchant for profiteering as they will not miss any slightest opportunity to increase prices upon hearing of civil servants salary adjustments.

We implore our business people not to behave in an unethical manner by increasing the prices of goods and services they offer upon hearing of this salary adjustment.

Businesses should develop self-regulatory mechanisms and not to be threatened by Government actions or pieces of legislations for them to conduct themselves in an ethical manner. We do not need controls on our market, the prices should be managed by perfect competition where the rules of demand and supply will be at play.

We despise businesspeople who want to make money by increasing the prices of the commodities as a way of boosting their revenue because we believe businesses should make money by moving huge volumes.

Companies that move volumes create more employment and empower many communities through downstream effect and they are assured of sustainable growth. As the civil servants in various grades’ disposable income increases, we believe a number of them will afford products that had become beyond their reach.

As the taste and preferences of many civil servants increases after the income adjustments, more companies producing a variety of products are going to benefit.

The workers should also know that a gradual and sustained salary adjustment will enable the systems to realign themselves and in the process will not provide headaches for national economic managers.

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