Zimbabwe parastatal paying for civil servants salaries

Zimbabwe's state media has reported that the state mining corporation says it is paying government employee raised this month with revenues from controversy-mired diamond fields in eastern Zimbabwe in a development that raises the stakes for a new parallel government with its own Finance Ministry under Zanu PF.

Zimbabwe Mining Development Corporation (ZMDC) chairman Mr Godwills Masimirembwa said there is nothing irregular and scandalous in the manner in which salary increments for civil servants were effected using diamond money as all formal channels were followedy.

The Finance Ministry, controlled by the prime minister's party in the troubled coalition, has said it didn't have the money from taxes to pay wage hikes.

But media loyal to President Robert Mugabe reported Monday that the head of ZMDC,  Masimirembwa said it was paying raises to some 200,000 state employees. The raises add an estimated $40 million to the monthly salaries tab.

Workers' representatives had found no joy after meeting Prime Minister Morgan Tsvangirai, Finance Minister Tendai Biti and his Public Service counterpart Eliphas Mukonoweshuro who told them that an increment was impossible as State coffers were dry.

Mugabe has called for early elections to end the coalition and in April promised raises to teachers and other civil servants who had threatened strike action.