News / National
'What skill will be lost if Cuthbert Dube leaves Psmas?' - Prof Moyo
13 Apr 2014 at 17:55hrs | Views
Zimbabwe will not run any loss if indicted corrupt parastatal CEOs left their offices because the country has abundant talent to take up those positions, a Cabinet minister has said.
Information Media and Broadcasting Services minister Jonathan Moyo on Thursday told a Zimbabwe Accountants of Zimbabwe conference that corruption is criminal and all those found guilty should be "honourable" and leave.
The minister's call comes as President Robert Mugabe has openly called for the arrest of corrupt individuals saying that the cancer had destroyed Africa.
"Some have argued that obscene and corrupt salaries and allowances paid by parastatals and State enterprises were necessary for skills retention…
"In any event, the claim that there would be a flight of skills if the corrupt salaries and allowances are reduced, as they have been capped at $6 000, is self-indulgent. What skill in God's name will be lost; if Cuthbert Dube leaves Premier Service Medical Aid Society (Psmas), as he has hopefully done to concentrate on doomed Zifa affairs?" Moyo said.
His sentiments come in the wake of blistering media revelations of mega salaries earned by executives in parastatals most of which were practically insolvent with ordinary workers going for months without pay.
The Mugabe-led government is baying for blood against the CEOs enriching themselves in State enterprises following reports that the likes of Zimbabwe Broadcasting Corporation (ZBC) boss Happison Muchechetere, now suspended, was earning $44 000 per month.
Cuthbert Dube's $535 000 salary left Zimbabweans stunned, with government officials admitting the practice was widespread in nearly all State enterprises.
Government has since declared a $6 000 cap for top earners in the State-owned enterprises and local authorities, a development the parastatal chiefs have received with a lot of disgruntlement. Some have even threatened to hand in their resignation letters.
"Zimbabwe is a highly literate country, with the highest literacy rate in Africa, due to the extensive investment in education championed by president Mugabe over the past three decades since the nation's historic independence in 1980.
"In fact, the one comparative advantage that Zimbabwe has is the existence of a critical core of professional skills possessed by young people in the country and the Diaspora who are ready to take their professional places but who are currently frustrated by the lack of opportunities," he told the conference.
Moyo said the country has not been able to fully utilise its skilled human resource endowment in light of the high unemployment rate and poor job creation.
"In this regard, there are sufficient skills at the right salary levels that the country can call upon to make parastatals and state enterprises succeed in accordance with their mandates," Moyo told the accountants.
According to figures released by Moyo at the conference, government spent $600 million paying hefty salaries and benefits to senior management and fees to boards of parastatals between 2009 and 2013.
"Had these salaries been capped at $6 000 per month and board allowance fees at $10 000 per annum since 2009, we would have lowered the wage bills of CEOs, senior management and board members to $78 million which would have translated to a $55 million annual reduction in the current wage bill," he said.
Effectively, this would have saved the country approximately $220 million and it would have amounted to 5,7 percent of 2013 government expenditure.
"When compared to the wage bills of similar entities in the region, the current salaries paid by parastatals and State enterprises are far too high and unsustainable" Moyo told the accountants who he accused of letting the country down as they are responsible for the disbursement of funds at the parastatals.
The total 2013 wage bill for senior management and boards was approximately $133 million. This translates to 3,5 percent of government expenditure.
"The beneficiaries of this bounty are a paltry 3 000 individuals (made up of board members and executive management of parastatals and State enterprises) spending as much as 3,5 percent of government expenditure to the detriment of some 13 million Zimbabweans who have a right to expect the government to support," the minister fumed.
In the period between 2009 and 2013, the average monthly salary for CEOs and senior management of parastatals and State enterprises was $9 040 which translates to a 2,752 percent premium above the $317 monthly salary level for ordinary civil servants, well below the Poverty Datum Line of $500.
"This income inequality has constrained labour productivity by eroding individual self-motivation thereby risking social unrest emanating from the workplace.
"Indeed, the wide income gap may be an important explanatory factor why the ongoing economic recovery does not feel like a recovery at all to many ordinary Zimbabweans" said Moyo.
At the same conference, Moyo said government is in the process of enacting a legislative piece on the governance of parastatals, State enterprises and local authorities targeted at public service chiefs who did not comply with the $6 000 salary cap.
Information Media and Broadcasting Services minister Jonathan Moyo on Thursday told a Zimbabwe Accountants of Zimbabwe conference that corruption is criminal and all those found guilty should be "honourable" and leave.
The minister's call comes as President Robert Mugabe has openly called for the arrest of corrupt individuals saying that the cancer had destroyed Africa.
"Some have argued that obscene and corrupt salaries and allowances paid by parastatals and State enterprises were necessary for skills retention…
"In any event, the claim that there would be a flight of skills if the corrupt salaries and allowances are reduced, as they have been capped at $6 000, is self-indulgent. What skill in God's name will be lost; if Cuthbert Dube leaves Premier Service Medical Aid Society (Psmas), as he has hopefully done to concentrate on doomed Zifa affairs?" Moyo said.
His sentiments come in the wake of blistering media revelations of mega salaries earned by executives in parastatals most of which were practically insolvent with ordinary workers going for months without pay.
The Mugabe-led government is baying for blood against the CEOs enriching themselves in State enterprises following reports that the likes of Zimbabwe Broadcasting Corporation (ZBC) boss Happison Muchechetere, now suspended, was earning $44 000 per month.
Cuthbert Dube's $535 000 salary left Zimbabweans stunned, with government officials admitting the practice was widespread in nearly all State enterprises.
Government has since declared a $6 000 cap for top earners in the State-owned enterprises and local authorities, a development the parastatal chiefs have received with a lot of disgruntlement. Some have even threatened to hand in their resignation letters.
"Zimbabwe is a highly literate country, with the highest literacy rate in Africa, due to the extensive investment in education championed by president Mugabe over the past three decades since the nation's historic independence in 1980.
"In fact, the one comparative advantage that Zimbabwe has is the existence of a critical core of professional skills possessed by young people in the country and the Diaspora who are ready to take their professional places but who are currently frustrated by the lack of opportunities," he told the conference.
Moyo said the country has not been able to fully utilise its skilled human resource endowment in light of the high unemployment rate and poor job creation.
"In this regard, there are sufficient skills at the right salary levels that the country can call upon to make parastatals and state enterprises succeed in accordance with their mandates," Moyo told the accountants.
According to figures released by Moyo at the conference, government spent $600 million paying hefty salaries and benefits to senior management and fees to boards of parastatals between 2009 and 2013.
"Had these salaries been capped at $6 000 per month and board allowance fees at $10 000 per annum since 2009, we would have lowered the wage bills of CEOs, senior management and board members to $78 million which would have translated to a $55 million annual reduction in the current wage bill," he said.
Effectively, this would have saved the country approximately $220 million and it would have amounted to 5,7 percent of 2013 government expenditure.
"When compared to the wage bills of similar entities in the region, the current salaries paid by parastatals and State enterprises are far too high and unsustainable" Moyo told the accountants who he accused of letting the country down as they are responsible for the disbursement of funds at the parastatals.
The total 2013 wage bill for senior management and boards was approximately $133 million. This translates to 3,5 percent of government expenditure.
"The beneficiaries of this bounty are a paltry 3 000 individuals (made up of board members and executive management of parastatals and State enterprises) spending as much as 3,5 percent of government expenditure to the detriment of some 13 million Zimbabweans who have a right to expect the government to support," the minister fumed.
In the period between 2009 and 2013, the average monthly salary for CEOs and senior management of parastatals and State enterprises was $9 040 which translates to a 2,752 percent premium above the $317 monthly salary level for ordinary civil servants, well below the Poverty Datum Line of $500.
"This income inequality has constrained labour productivity by eroding individual self-motivation thereby risking social unrest emanating from the workplace.
"Indeed, the wide income gap may be an important explanatory factor why the ongoing economic recovery does not feel like a recovery at all to many ordinary Zimbabweans" said Moyo.
At the same conference, Moyo said government is in the process of enacting a legislative piece on the governance of parastatals, State enterprises and local authorities targeted at public service chiefs who did not comply with the $6 000 salary cap.
Source - dailynews
