Govt has no money to pay civil servants bonuses

Gross under-performance of revenue inflows has crippled Government programmes including raising money to pay civil servants bonuses, 
Finance Minister Tendai Biti on Thursday said .
Addressing journalists on the state of the economy, Minister Biti said Government missed its monthly revenue collection targets by an average $30 million since January. This saw Treasury failing to set aside $7,5 million monthly towards the $150 million needed for civil servants' 13th cheques by December.
"Since the announcement of my mid-term fiscal statement on 18 July  2012, I regret to advise that the economy remains depressed with funding challenges for both public and private sectors," Minister Biti said.
"Given persistent revenue under-performance, it has not been possible to set aside resources to cater for the $150 million required to pay the 2012 bonus," he said.
This is a U-turn by the Finance Minister who on Tuesday told our Harare Bureau that Government was seized with mobilising money for civil servants' bonuses and the farming season making it impossible to fund by-elections this year.
Poor performance of key economic fundamentals has already seen the minister revising this year's economic growth rate from 9,4 percent to 5,6 percent.
The budget was also reduced from $4 billion to $3,6 billion.
At the current rate of revenue collection the Government would have to find ways of securing $400 million to meet its financial obligations.
Minister Biti has since secured a meeting with South Africa's Finance Minister Pravin Godhan to solicit $100 million budgetary support.
Between January and December Treasury collected $1,597 billion against a target of $1,837 billion.
The Government has thus struggled to fund critical obligations such as agriculture, key infrastructure, population census, provision of social services, livestock drought mitigation and payment to inputs suppliers.
The sluggish performance also comes as Treasury has been groping into an overstretched fiscus to raise $130 million needed for the summer cropping season.
Treasury would also have to secure between $40 million and $80 million for the referendum.
Government is also battling other serious sanctions-induced economic problems among them low foreign investment, low industrial capacity, debt overhang, unemployment and constrained bank lending capacity.
He said Treasury received about $41,7 million from diamonds against the $336 million it expected to get from sales of the gem.
Diamond exports since January totalled $456 million, he said.
He did not say how much was remitted from other minerals.
Due to the tight financial situation Treasury said it would be more aggressive to get revenue by directing Government departments receiving revenue, which is lying idle to remit to the fiscal authorities.
Minister Biti would soon engage South Africa and Angola for lines of credit they pledged while expectations are that the International Monetary Fund would decide in October to work with Harare under arrangements that would open doors to lines of credit. Treasury pledged to find ways to secure funding required for three vacant parliamentary constituencies in Matabeleland region as directed by the High Court.
Minister Biti said Government could not afford to disobey the High Court ruling. He, however, insisted there was no money for by-elections in other constituencies.