Government delays paying some salaries as cash crunch bites

December 28, 2015 3:23 PM

"Treasury advises that the December 2015 salary payment date for the rest of the public service is also being moved from 29 December 2015 to 5 January 2016," Chinamasa said.

Zimbabwe's Finance Minister Patrick Chinamasa (L) addresses a media conference in a file photo. REUTERS/Philimon Bulawayo

Zimbabwe has delayed paying December salaries for most of its public sector workers to early next month and has not paid annual bonuses, in a sign of a cash crunch that brought threats of strikes from doctors and teachers on Monday.

Doctors working at state hospitals and the main teachers' union demanded the payment of salaries and bonuses before Dec. 31, warning of possible strikes next year.

Zimbabwe spends more than 80 percent of its budget on salaries, mainly for the army, police, teachers and nurses, but only managed to pay soldiers earlier this month.

Finance Minister Patrick Chinamasa said in a statement on Monday that December wages for teachers and other education sector workers would be paid on Tuesday.

"Treasury advises that the December 2015 salary payment date for the rest of the public service is also being moved from 29 December 2015 to 5 January 2016," Chinamasa said. He could not be reached for further comment.

The government spends more than $260 million every month on salaries for more than 300,000 of its employees.

Zimbabwe finances its entire budget from taxes because lenders like the International Monetary Fund and World Bank will only consider fresh loans once it clears its debts. Tax revenues are falling as the economy struggles with weak commodity prices and high unemployment.

Chinamasa did not say when bonuses, equivalent to one month's salary and traditionally paid in November, would be paid.

"Our December salary and 2015 bonus must be disbursed on or before Dec. 31. Our members countrywide will not be able to attend to their duties from Jan. 1, 2016 should this be violated," read a statement from the Zimbabwe Hospital Doctors Association.

Last April, Chinamasa said the government would not pay annual bonuses to public workers for two years, citing falling tax revenues, only for President Robert Mugabe to reverse the decision.

Enhance Your Pulse News Experience!

Get rewards worth up to $20 when selected to participate in our exclusive focus group. Your input will help us to make informed decisions that align with your needs and preferences.

I've got feedback!