Prosper Ndlovu Deputy News Editor
THE government has capped salaries of chief executive officers of State enterprises and parastatals at $6,000 per month as it moves to restore sanity following revelations that executives were awarding themselves “obscene” packages of up to $535,000.Finance Minister Patrick Chinamasa, who chairs a Cabinet Committee on State Enterprises and Parastatals, also released a salary schedule for all the 90 parastatals.
Under the new regime, the CEOs have been grouped into six levels with the three Level 1 CEOs from ZIMRA, ZESA and the RBZ earning $6,000, with the least paid Level 6 CEOs pay – including benefits – set at $1,966.
Speaking after a Cabinet meeting yesterday, Cde Chinamasa said: “With immediate effect Cabinet decided, as an interim measure, that no chief executive officer of any State enterprise, parastatal or local authority should receive a total pay package (basic salary and benefits) which is above $6,000 per month for those in job Level 1. Accordingly, therefore, salaries should be immediately cascaded downwards in each organisation. However, the lowest paid employee should not fall below the Poverty Datum Line.”
Of the $6,000, 60 percent should be the basic salary while 40 percent should constitute other benefits.
Minister Chinamasa said a Cabinet-ordered investigation into the “Salarygate” scandal had revealed that CEOs were setting low basic pay and then awarding themselves huge benefits. “There was a deliberate migration from basic salaries to hefty benefits,” he said. “This was a ruse to run away from taxation and Income Tax laws should now apply to the total pay package.”
Cde Chinamasa gave the example of the Plumtree local board chief executive officer who was earning a basic salary of $1,173 which ballooned to a mouth watering $17,027 with benefits.
A schedule of State enterprises CEO pay released yesterday showed that the former Premier Service Medical Aid Society (PSMAS) CEO Cuthbert Dube raked in an astonishing $535,500, with monthly benefits of $305,500.
NetOne boss Reward Kangai is the second highest earner with a total pay of $43,693 made up of a basic pay of $10,126 and allowances of $33,567.
The ZBC’s suspended CEO Happison Muchechetere weighed in as the third highest earner with a pay of $37,050.
John Chikura of the Deposit Protection Corporation (DPC) had a salary of $36,359, of which $24,477 were benefits — making him the fourth highest paid parastatal boss.
The Infrastructure Development Bank of Zimbabwe (IDBZ) boss Charles Chikaura had a hefty $35,359 total pay, followed by the Reserve Bank of Zimbabwe governor who was sixth with a total package of $32,943.
The Zimbabwe Mining Development Company’s Jerry Ndlovu, recently suspended, had a package of $31,722, just ahead of the National Social Security Authority (NSSA) boss James Matiza on $29,062.
Sitting in ninth is the Zimbabwe Energy Regulatory Authority (Zera) boss Gloria Magombo with a hefty $28,403 gross salary.
Agribank CEO Somukosi Malaba is the 10th best paid parastatal boss with a package of $27,862.
Other notable high earners were the Zimbabwe National Road Authority (Zinara) chief executive officer Frank Chitukutuku who earns $25,516 and is 12th overall; TelOne chief Chipo Mutasa ($24,940) and Zimbabwe Revenue Authority (Zimra) head Gershem Pasi who slots in 15th with a package of $24,041 made up of a basic of $11,670 and benefits of $12,371.
Zesa chief Josh Chifamba is position 20 on the list with a total pay of $17,926 with the Grain Marketing Board’s Albert Mandizha ($17,800) and the Zimbabwe National Water Authority (ZINWA) boss Albert Muyambo ($17,200) closely matching him.
The State Procurement Board chief is at position 33 earning a monthly total of $13,961 while the National Railways of Zimbabwe CEO sits on 34 at $13,864.
ZIMSEC and CMED bosses were 43rd and 44th overall with monthly salaries of $10,185 and $10,108 respectively.
The Zimbabwe Tourism Authority’s Karikoga Kaseke gets $9,050 while the Air Zimbabwe boss earns a total of $7,388.
Heads of tertiary institutions Nust, Midlands State University, Lupane State University, the University of Zimbabwe, Zimbabwe Open University and the Chinhoyi University of Technology range between $5,813 to $7,172 with Chinhoyi at the top.
According to the new government directive, bosses of Zimra, Zesa and the RBZ governor will be the top earners as they fall in the Level 1 bracket.
On the second tier will be CEOs of NRZ, TelOne, PSMAS, and NSSA who would earn a maximum of $5,700.
Level 3, made up of bosses of Petrotrade, NOIC, POSB, NetOne and Marange Resources will earn a maximum of $5,415.
Six entities – Zinara, Air Zimbabwe, GMB, University of Zimbabwe, Zinwa and REA —are listed under Level 4 with the top pay set at $5,144.
A total of 32 enterprises — among them the National Aids Council, ZIMSEC, CSC, ZMDC, ZBC, ZTA and ZIMPOST — fall under Level 5 and bosses have been set a pay ceiling of $4387.
The rest of the parastatals will fall under Level 6, which sets the highest earner’s pay including allowances and benefits at $4,167. Level 6 State enterprises include the Deposit Protection Corporation, the State Procurement Board, Lupane State University and the Zimbabwe Energy Regulatory Authority.
Minister Chinamasa, who spoke to reporters flanked by his Information, Media and Broadcasting Services counterpart Professor Jonathan Moyo, said failure to observe the new salary structure would invite serious penalties.
“We’re not going to allow them to continue a day longer (on the old pay structure) because the audit process is going to take some time,” he said.
“In the private sector, they’re not getting such perks yet they’re in the productive sector.”
Apart from dealing with salaries of CEOs and local authorities, Minister Chinamasa said the government was also dealing with board fees and other perks paid to board members.
Going forward, Minister Chinamasa said contracts of CEOs should spell out at the time of engagement the terminal benefits and circumstances under which he or she could be disengaged.
With regards to the State Enterprises and Parastatals, he said a Hay Job Evaluation System should be adopted.
“The Hay methodology evaluates jobs against a set of common factors that measures know-how, problem solving, and accountability,” he said. “The jobs are placed in levels ranging from one to six.”
Minister Chinamasa said much of the corruption was perpetuated between 2009 and 2013 when the country was ruled by a coalition government.
“The inclusive government was dysfunctional and this is where these CEOs took advantage,” he said. “We spent most of our energies in the past four years not doing productive work I must confess. We were just quarrelling among us as coalition partners and in the process basically allowing this sort of thing to happen under our very noses. No-one was supervising anything because our energies were basically expended on petty quarrels.”
He said the government was prepared to deal with CEOs who might want to take legal action after having their salaries slashed.
“We will take them on,” he said. “That’s the least of my worries as a lawyer. Let whoever all and sundry who want to take us to court do so. I’ll be interested to know on what legal grounds they stand on, what moral grounds they stand.”