Zim Abandones the ZiG Currency Projects as It Dollarises Govt Workers’ Salaries

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HARARE – The Treasury has earmarked significant funds to revise the remuneration packages for government employees, including an increase in the US dollar component of their salaries.

This move aims to cushion workers from the impact of the recent devaluation of Zimbabwe’s gold-backed currency (ZiG) against the US dollar.

The new salary package will primarily benefit lower-income government employees and will be presented to workers’ representatives during the upcoming National Joint Negotiating Council (NJNC) meeting. The NJNC is the official platform for discussions on public sector working conditions between the government and worker representatives.

In addition to the salary adjustments, the government has committed to paying civil servants their annual bonuses this year, with consultations on the timing of the 13th cheque nearing completion.

Minister of Public Service, Labour, and Social Welfare July Moyo confirmed to The Sunday Mail that Treasury has already set aside the required US dollars for the salary increases.

“The government has allocated a substantial amount in US dollars to ensure that all civil servants benefit from these salary adjustments,” said Minister Moyo. “Under the President’s directive, we are prioritising salary increases for lower-income employees to help close the wage gap.”

This directive has been communicated to both government and civil service union negotiators. Minister Moyo expressed optimism that the proposed adjustments will be accepted by both sides, highlighting the need to address the financial challenges faced by lower-income civil servants.

“While higher-level officials can manage on their current salaries, it is crucial that we provide sufficient support to those at the lower end of the pay scale. We are confident that the government will approve proposals that address the needs of our lower-income workers,” he added.

Regarding the annual bonus, Minister Moyo confirmed that payment modalities will be announced soon.

“We will make an announcement after consultations with Treasury, but the bonus payment is guaranteed,” he said.

Chairperson of the Zimbabwe Confederation of Public Sector Trade Unions, Mrs. Cecilia Alexander, welcomed the government’s decision to pay this year’s bonus.

“In April, we agreed with the government that salaries would be indexed to the US dollar exchange rate, although part of the salary is paid in ZiG,” said Mrs. Alexander. “This means that when ZiG is devalued, the ZiG component will be adjusted to reflect the current exchange rate, maintaining the same value.”

She acknowledged that the recent devaluation occurred after salaries had already been paid, causing workers to be short-changed. However, discussions are ongoing to address this issue.

“For bonus payments, we are asking the government to follow last year’s approach, where 50% was paid in November, with the remainder disbursed in December,” she added.