Government will embark on a civil service retrenchment exercise early next year as treasury seeks to reduce recurrent expenditure which currently gobbles over 90% of the budget, Finance minister Mthuli Ncube has said.
“The retrenchment of government workers will start next year and in December in 2019, we should have done with the retrenchment,” Ncube told lawmakers at a pre-budget seminar in Bulawayo on Thursday.
He was responding to a question from legislators when the job cuts in government would start.
“However there are certain obligations which will remain with us on our books such as pensions that we cannot run away from,” Ncube said.
Government expects to save $330 million by 2020 through wage bill containment measures that will result in the right sizing of public employment among a raft of reforms to rein in runaway expenditure.
According to the Transitional Stabilisation Programme which runs from October to December 2020, the 2019 National Budget will institute measures that will reduce the annual wage bill outlay by around $200 million (0,7 percent of GDP). The 2020 National Budget will come out with measures that will further reduce the wage bill by $130 million (0,3 percent of GDP).
The wage bill containment measures include rationalisation of some posts in the public service, right sizing of public employment, reduction in budget travel expenditures and rationalisation of foreign service missions, according to the plan unveiled by Ncube last month.