Inflation wipes out salaries: Unions

Source: Inflation wipes out salaries: Unions – DailyNews Live

Helen Kadirire  3 October 2017

HARARE – Salaries are being badly eroded in values due to devastating
inflation, which has soared to 242 percent, according to a leading
economist Steve Hanke.

Zimbabwe Congress of Trade Unions (ZCTU) secretary-general Japhet Moyo
told the Daily News yesterday that the high level of inflation means most
workers’ wages will not go as far as they did last year.

“By December, our salaries will be worthless because right now what is
being deposited into people’s accounts are figures – it is not money,
imhepo (air). These salaries will be nothing more than bus fare by the end
of the year,” Moyo said.

The union leader said for more than three years, there has not been any
collective bargaining.

Moyo said the lack of salary review has meant that daily, people have to
struggle to meet their obligations on the little that is available.

“From a survey that we conducted, it showed that since dollarisation,
there has not been any salary increase that goes in tandem with the
economy. While some companies are paying their employees in batches,
others have not received their salaries in months. With the current
devaluation of the bond note, salaries have also been reduced.

“Workers have been trying to negotiate for salary increments to no avail
because of government’s salary reduction mantra. Employees and employers
are stuck because of poor government policies that are destroying people’s
lives,” Moyo said.

Zimbabwe Federation of Trade Unions (ZFTU) vice-president Joseph
Chinotimba said raising salaries was not a solution to the rising food
prices.

This comes as shortages of basic goods and fuel have resurfaced, sparking
panic buying by consumers.

Prices of imported products have also skyrocketed, which businesses blame
on shortages of foreign exchange.

“Though the situation is bad for everyone those tuck shop owners should be
arrested. If they are all behind bars, no one will increase the price of
items.

“Even the money changers on the streets should be stopped from operating.
However, we are faced with a situation in the rural areas where there is
no supervision of those small shops which makes the rural people
vulnerable to them. Government should take hard core action on all these
people and whip them into line,” Chinotimba said.

Moyo said ZCTU was flabbergasted that crisp bond notes have flooded the
streets yet there is nothing in the banks.

“The banks have systems which limit withdrawals. The State is releasing
that money and fuelling the black market. It is the State that is
responsible for inflation and the devaluation of the bond note.

“The State is solely responsible for the devaluation of employees’
salaries and the increase in prices of commodities. This is a key
indicator that whoever is driving the ship called Zimbabwe is going in the
wrong direction,” he said.

“Companies will increasingly find it difficult to restock because there is
a long queue for foreign currency at the Reserve Bank. More and more
players will emerge on the black market and this will force companies to
go to them for foreign currency.”

He said while Zimbabwe’s policies are skewed, government is adamant that
salaries need to be slashed.