Re: Meanwhile, in Zimbabwe *LINK*
Posted By: Masimba Musodza In Response To: Re: Meanwhile, in Zimbabwe *LINK* (Masimba Musodza)
Date: Tuesday, 28 September 2004, at 11:24 a.m.
In Response To: Re: Meanwhile, in Zimbabwe *LINK* (Masimba Musodza)
It is politically expedient yet economically imprudent moves that are bringing Zimbabwe down.
Mujibhas win battle for compensation - o Economists warn of economic disaster
By Caiphas Chimhete
THE government has gazetted the Ex-Political Prisoners, Detainees and Restrictees Bill, which seeks to dole out millions of dollars to people affected by the struggle for independence, but analysts warned of serious repercussions to the economy.
Although there is no mention of figures in the Bill, earlier reports put the one-off gratuity payments at $10 million a person. The government has not disputed this amount.
The Bill gazetted on Friday, among other things, provides for a one-off gratuity payment to former political prisoners, detainees and restrictees as well as a monthly pension, not less than the minimum salary paid to public service workers.
Also, there will be a monthly survivor's or child pension payable to the dependants of a deceased ex-political prisoner, detainee or restrictee.
The Bill, which is expected to be fast tracked through Parliament, will also establish schemes for the provision of financial assistance to ex-political prisoners, detainees and restrictees, as well as their dependants.
Such assistance would come from a fund that will be set up by government. The Minister of Public Service, Labour and Social Welfare, who at the moment is Paul Mangwana, will have "sole management, control and use of the fund", according to the Bill.
Among other functions, the fund provides for grants for subsistence, physical, mental or social rehabilitation as well as manpower development for the beneficiaries.
It also provides for loans, "whether with or without interest", financial technical, managerial or any other form of assistance to ex-political prisoners, detainees or restrictees involved in income-generating projects.
In what amounts to a State funerals for every beneficiary, the Fund will also take care of their funeral expenses.
University of Zimbabwe political science lecturer, Eldred Masunungure, said : "From an economic standpoint, it is too disastrous for an ailing economy like ours. But from the political side, it will give enormous support to the ruling party."
Other analysts described the Bill as a populist move which spells doom for the country's economy. They said its magnitude could only be rivalled by the November 1997 crisis, which was triggered by the hefty unbudgeted gratuities and pensions awarded to former freedom fighters.
President Mugabe, under siege from marauding war veterans led by the late Dr Chenjerai Hunzvi, awarded war veterans $50 000 gratuities each, sending the economy into a free fall in what came to be known as "Black Friday".
Economic analyst Dr Eric Bloch said compensating ex-political prisoners, detainees and restrictees will further increase the government deficit and in turn, trigger a hyper-inflationary environment, which is a recipe for "economic disaster".
The Bulawayo-based economist said if huge funds are involved it would be a repeat of the December 1997 scenario, which precipitated the current economic meltdown.
"The government has no money. To raise it, it would have to increase taxes and this will certainly lead to more people suffering," said Bloch.
The Bill describes an ex-political prisoner, detainee or restrictee as a person who after January 1, 1959, was imprisoned, detained or restricted in Zimbabwe for at least six months for political activity in connection with bringing about the country's independence.
Masunungure believes it is more beneficial to address economic fundamentals than to scout for victims of the war of liberation, 24 years after independence.
"Let sleeping dogs lie and proceed with solving the country's economic problems because if the economy is running well you will not need to cushion anybody," said Masunungure.
Opposition MDC secretary-general, Professor Welshman Ncube, said effects of the Bill, if signed into law, would be as "disastrous" as the gratuities and pensions awarded to war veterans in 1997.
Ncube said it was mind-boggling that a government failing to fund capital projects in sectors of health and education was seeking to dole out money to millions of "purported" ex-political prisoners and detainees, over two decades after independence.
Reserve Bank Governor, Dr Gideon Gono, who is expected to meet World Bank officials next month for consultations on Zimbabwe, could not be reached for comment yesterday on how the government proposes to raise the money. The Acting Minister of Finance and Economic Development, Dr Herbert Murerwa, was also unavailable for comment yesterday.
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