Dealing with unfinished business
No doubt the incoming administration, like a new broom, will sweep them all clean.
But to share a few thoughts is not to be a busybody.
Presumably, the two-month wrangle with the Judiciary staff over salary revision is over. I need to be better informed. It was the ultimatum Mutharika got from the civil service that must have caused him new worries.
No doubt, once the funeral dust settles, the civil servants will revive the issue with our new President.
Not so long I wrote that the occasion for awarding increment and bonuses is when a company has made substantial sales and profits.
If you award hefty salaries when the company has performed poorly on the market, you can kill that business.
In public service, there are no profits and losses to guide the awarding of increments. So how do we decide when to compensate civil servants generously?
The criterion should be the state of the economy as a whole. When growth rates of the gross domestic product have increased continuously for at least three years, increments can be provided.
If you make hefty increments when the economy is declining in growth rates, you are likely to print more notes than the economy can accommodate and inflation can result.
People may have more bank notes in their pockets but without food in their baskets because the production of goods and services has not changed.
In handing civil servants claims, the political side of government should take extra care.
I am talking of the political government because the civil service is part of the government. It is not as if the President and his ministers are on one side, and the civil service on the other.
Before the political side of government knows how much money government has collected or spent, it is the civil service side of government that knows.
Both branches of the government should try to find out why some countries in the European Union are in financial strains, notably Greece.
Whether as individuals, corporate or governments we live beyond our means, insolvent and bankruptcy will overtake us.
This state of affairs comes about when certain sections of society ‘capture’ the government. That is when they become so powerful that they compel a government to give them whatever they demand without themselves being more productive. They are said to be rent-seekers, people who earn more than they have contributed to the economy.
A good deal of trust should be established. Avoid the language of attack and counter attack. What should concern us first is to accelerate economic growth which is the sine qua non of improved standards of living and social welfare.
Our departed president put much heart in giving this country about five more universities.
It was a visionary programme. It is said a nation without a vision is lost. Still we must be sure we are not overstretching the resources of the country.
The idea of building extra universities arose out of a desire to do justice to undergraduates who are great performers than those who are moderately so. Under the quota system, students who have extremely done well are denied scholarships to public universities in favour of runners-up.
There is the risk that in the present state of the economy, government may not collect enough revenue to subsidise all universities. That aside, the universities may produce too many graduates for the private and civil sectors to employ.
Social and political upheavals in some countries have been started by unemployed or underemployed graduates.
The question of devaluation of the kwacha will soon come up. Possibly it is the International Monetary Fund (IMF) and donors who may revive it.
We must avoid assumptions that refusing to devalue the kwacha by 40 percent or so was one of the biggest errors Mutharika made.
Theoretically, it is true that when the kwacha is devalued our exports will be more competitive. But it also depends on the range of exports. Are we talking of tobacco, tea, sugar and cotton, we must be specific?
What is not in doubt is that devaluation will make imported goods expensive. If we produce such goods locally, we will ‘buy Malawian’ and shun expensive foreign goods. How about petrol and fertiliser?
Our government should consult and seek help on how to protect the poor from inflation arising from devaluation.
