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'Zimbabwe workers and pensioners will suffer more in 2026'
07 Jan 2026 at 20:04hrs |
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Workers and pensioners in Zimbabwe are expected to face heightened economic hardships in 2026 due to stagnant salaries, rising taxes, and the unresolved issue of compensation for losses suffered during the 2009 hyperinflation, the Zimbabwe Congress of Trade Unions (ZCTU) has warned.
In its 2026 National Budget Critique, prepared by ZCTU's think tank, the Labour and Economic Development Research Institute of Zimbabwe (LEDRIZ), the labour body argues that the working class will continue to bear the brunt of ongoing economic reforms.
The report notes that Finance Minister Mthuli Ncube failed to address the long-standing 2009 Pensions Compensation matter, a move that paints a bleak outlook for workers and retirees. "While in past budgets the Minister provided updates on the recommendations of the Justice Smith Commission of Inquiry regarding compensation for loss of value, the 2026 National Budget Statement omitted this aspect," the critique states.
ZCTU also highlighted that minimum wages remain alarmingly low. The paper points out that junior lecturers at the University of Zimbabwe, who earned an average of US$2,250 per month before October 2018, now take home just US$230 plus a local currency component worth less than US$200, representing an effective salary cut of 87%.
"The slow pace of wage adjustment is evident in that the minimum wage negotiated at the Tripartite Negotiating Forum (TNF) of US$150 per month was only gazetted in May 2025, despite Cabinet approving it in October 2022," the critique notes.
The ZCTU further warned that heightened job losses and a tight labour market, coupled with an overly restrictive monetary policy, have created artificial shortages of domestic currency amid a rapidly dollarizing economy.
While some proposed measures in the 2026 budget are welcome — such as the reduction of the Intermediated Money Transfer Tax (IMTT) on ZiG-denominated transactions from 2% to 1.5% — the labour body said other proposals, including a VAT increase from 15% to 15.5% and the maintenance of a 2% IMTT on foreign currency transactions, will exacerbate the plight of workers.
ZCTU cautioned that without meaningful interventions to protect incomes and address historical compensation claims, Zimbabwe's working class is likely to face worsening living conditions in the year ahead.
In its 2026 National Budget Critique, prepared by ZCTU's think tank, the Labour and Economic Development Research Institute of Zimbabwe (LEDRIZ), the labour body argues that the working class will continue to bear the brunt of ongoing economic reforms.
The report notes that Finance Minister Mthuli Ncube failed to address the long-standing 2009 Pensions Compensation matter, a move that paints a bleak outlook for workers and retirees. "While in past budgets the Minister provided updates on the recommendations of the Justice Smith Commission of Inquiry regarding compensation for loss of value, the 2026 National Budget Statement omitted this aspect," the critique states.
ZCTU also highlighted that minimum wages remain alarmingly low. The paper points out that junior lecturers at the University of Zimbabwe, who earned an average of US$2,250 per month before October 2018, now take home just US$230 plus a local currency component worth less than US$200, representing an effective salary cut of 87%.
The ZCTU further warned that heightened job losses and a tight labour market, coupled with an overly restrictive monetary policy, have created artificial shortages of domestic currency amid a rapidly dollarizing economy.
While some proposed measures in the 2026 budget are welcome — such as the reduction of the Intermediated Money Transfer Tax (IMTT) on ZiG-denominated transactions from 2% to 1.5% — the labour body said other proposals, including a VAT increase from 15% to 15.5% and the maintenance of a 2% IMTT on foreign currency transactions, will exacerbate the plight of workers.
ZCTU cautioned that without meaningful interventions to protect incomes and address historical compensation claims, Zimbabwe's working class is likely to face worsening living conditions in the year ahead.
Source - newzimbabwe
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