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GOVERNMENT HIKES LOWEST SALARIES

Lowest paid civil servants will smile all the way to the bank after government approved a salary increment ranging from five percent to 22 percent effective July 1 2015.

This means salaries of civil servants in Grades A to I, which received an average 44 percent increment in the 2014/15 financial year and contributed to an increase in the wage bill from K163 billion ($362.2 million) to K198 billion ($440 million), will get nothing this time around.

Justified rise in wage bill: Gondwe
Justified rise in wage bill: Gondwe

The increase in the wage bill is likely to be low this financial year as the circular issued on Friday by the Secretary for Human Resource Management and Development Blessings Chilabade indicates that only lower grade civil servants have been considered.

Reads in part the circular: “I am pleased to inform you that government has approved the revision of salaries for employees in the civil service in Grades J and below with effect from 1st July 2015. The salaries for Grades I and above have not changed.”

In the teaching service, Grade J—a senior supervisor position—the old annual salary of K1 301 244 ($2 891.65) has moved to K1 366 308 ($3 036.24), representing five percent while Grade R which is industrial class sees the highest increment from K493 296 ($1 096.21) to K600 000 ($1 333) annually, representing 22 percent.

Grades K and L which are supervisor and senior clerical positions will get 10 percent increment while Grade M, a clerical or tradesmen position, will get an increment of 15 percent, according to the appendices attached to the circular seen by The Nation.

This means that the salary for lowest paid civil servant, Grade R, will move from K41 000 ($91) to K50 000 ($111) after tax and other deductions.

Civil Servants Trade Union (CSTU) general secretary Madalitso Njolomole said in an interview yesterday the union is happy that lower grade civil servants have received consideration as per their request.

CSTU had earlier issued a 21-day ultimatum upon discovering that Grades M and below would get a mere six percent increment while Grades K and L received three percent.

Said Njolomole yesterday: “Our agreement still stands that whatever civil servants’ salary revision comes, the lower cadres should get higher in terms of percentages.”

Minister of Finance, Economic Planning and Development Goodall Gondwe has said the ratio of the wage bill will rise to 6.7 percent of the gross domestic product (GDP) and remains below 25 percent of the budget.

Gondwe’s explanation came in the wake of warnings by economic commentators that government risked going bankrupt if it granted civil servants a salary increase as the country’s public sector salaries already consumed about 25 percent of the national budget.

Internationally, the standard cut-off point for public service salaries and wages is eight percent of GDP. Prior to the passing of the 2015/16 National Budget in June, Malawi’s ratio of salaries to GDP stood at 6.9 percent, just 1.1 percentage points shy, according to information from Treasury.

In the 2015/16 National Budget that rolled out on July 1, government increased annual salaries and wages for civil servants, a development that was expected to push the wage bill from K198 billion to K228 billion, resulting in 25 percent of the financial plan being spent on salaries and wages for less than 200 000 people out of the estimated 16 million population.

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