Government slashes salaries

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Cabinet has capped salaries and allowances for managers in State-owned companies at a maximum of $6 000 per month, Finance minister Patrick Chinamasa said

HARARE — Cabinet has capped salaries and allowances for managers in State-owned companies at a maximum of $6 000 per month, Finance minister Patrick Chinamasa said yesterday, as the government moves to rein in runaway parastatal perks that have triggered public outrage.

“It is an interim measure, pending finalisation of (the) remuneration structure,” Chinamasa told journalists at a press conference in Harare, following a Cabinet meeting that came up with a decision on executive pay in public enterprises.

He said parastatals, most of them perennial loss-makers, used to contribute 40% to Zimbabwe’s gross domestic product, but were now a drain on resources, while executives were awarding themselves hefty packages based on revenue collection and not performance.

Cabinet will also investigate fees paid to members of parastatal and municipal boards, although no work has been done on their perks.

“The unjustifiable salaries and allowances in the parastatals are not only corrupt, but obscene,” Chinamasa said.

He said local boards would now determine salaries and allowances for municipal managers whom he accused of increasing charges to pay unjustifiably high salaries and outrageous benefits.

Chinamasa said parastatal and municipal executive heads were loading benefits onto their packages to evade taxation.

He cited the example of Plumtree municipality’s chief executive who has a guaranteed pay package of $17 000, although his basic salary was $1 173.

Local authorities such as Harare and Gwanda were also found to be paying their senior managers unreasonable allowances.

An investigation into salaries of top managers at parastatals was triggered by reports that senior executives at the Premier Service Medical Aid Society were giving themselves obscene salaries.

Harare City Council directors were raking thousands of dollars in salaries and allowances before the government’s intervention through President Robert Mugabe’s office.

The $6 000 for the executives will now all be taxed, Chinamasa said.

— The Source/ Staff Reporter