Some economists that spoke the to Herald concerning the upcoming 2020 Budget Presentation that the Finance Minister is going to table in Parliament later today have urged the Finance Minister to resist pressure to hike civil servants’ salaries as that would be inflationary.
If we have a situation where everyone comes with their trade union and demand higher salaries and wages, prices will keep going up and we will not win the battle.
As such, salaries should remain more or less the same for now.
His sentiments were also voiced by famous economist and member of the RBZ’s Monitory Policy Advisors, Eddie Cross:
There is going to be increases in people’s salaries, but it’s going to be gradual and will be very carefully planned and monitored
Controversial ideas that have merit
Right now there are ongoing strikes involving doctors and nurses as well as other civil servants who have grumbled that the purchasing power of their salaries is being eroded by inflation. So saying no to salary hikes is going to be very hard to do.
However, here is the very sad truth the controversial proposals by these economists are not without merit. Salary hikes for civil servants have always been inevitably followed by price hikes in most shops sometimes just before or after the civil servant paydays.
A salary hike to counter the effects of inflation is like chasing the wind and ironically fuels that same inflation.
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