CfSC for K200 000 tax-free bracket as gov’t hikes civil servants’ salaries by 12%

A pay rise of twelve percent for the country’s civil service – across the board – has excited the civil servants, with the Civil Servants Trade Union (CSTU) saying the move is “commendable.”

“We are pleased that our negotiations have achieved this 12 percent adjustment which is much better than what was being offered at first,” said Mabvuto Kawonga, CSTU acting general secretary.

But the Centre for Social Concern (CfSC) has said the raise is nothing if the tax-free bracket is not looked into.

According to a memo signed by Secretary for Department of Human Resource

Mabvuto Kawonga, Acting Secretary General

Management and Development (DHRMD), Blessings Chilabade, the salary revisions “come after consultations with CSTU” and are effective from July 1 2021.

With the news revisions top grade civil servants will be earning an additional K1.6 million and the lowest getting an extra K210 000 per annum.

The DHRMD memo dated August 11, 2021 points out that the highest grade in the civil service, Grade A, only has the Chief Secretary to the President and Cabinet (SPC).

It means the salary for SPC Zangazanga Chikhosi annual salary has risen from K36.4 million to K38 million. He will be pocketing about K3.16 million each month.

And the lowest grade, Grade R, which mostly comprises unskilled employees, has had its annual pay raised from about K1.4 million to around K1.6 million.

It means employees in this grade will carting home a monthly salary of about K133 000.

Earlier, government announced it would effect a 10 percent increase in the 2021-2022 National Budget, but CSTU protested, demanding 12 percent and warning it would hold a sit-in if there was no adherence.

The new adjustment puts government wage bill at K502 billion which is about 25 percent of the 2021/22 budget.

But Bernard Mphepo, programme officer for economic justice at Centre for Social Concern (CfSC) said much as the pay hike was welcome, government needed to consider increasing the tax-free bracket.

“The move is welcome. But it is unmeaningful considering the proliferating living costs. The best government can do is to increase the tax-free bracket from the current K100 000 to at least K200 000. In that way, most civil servants – especially in the lowest grades will be cushioned,” Mphepo said.

In March 2021, CfSC said the rising cost of living in Malawi was throwing more people into a poverty trap.

It said – at the time – the cost of living had jumped by 91 percent for a family of six from K164 316 in July 2020 to K314 914 in January 2021.

Mphepo in a statement said that the level of income for an average Malawian was below minimum requirements for the cost of food items and cost of living—the cost of maintaining a certain standard of living.

The statement reads in part: “The increase in cost of living, which has been worsened by the Covid-19 situation, is impacting the living standard of Malawians yet most Malawians cannot afford basic necessities such as food, education and health.

“While the minimum wage was raised to the current K50 000, which is commendable, some workers have been pushed out of employment as some employers could not manage to pay their workers.”

The country’s headline inflation has been on the rise and was at 8.3 percent as of February 2021 on account of rising food and non–food prices.

The cost of basic items and services used on daily basis such as cooking oil, soap, charcoal and transport fares keep on rising.

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The Observer
9 months ago

If the PSs get K1.6 million per month before tax, how come they own very expensive houses worth more than K150 million? These just are stealing too much of our taxes. They steal anything they get hold of

Cairo
Cairo
9 months ago

What kind of nonsense is this? The President gets 100% rise and yet the rest get 12%, this is crazy. And yet, the President has lots of allowance including free food, accommodation whilst others have to fend for themselves all this. I thought the President should have deserved the least increase.

Tady
Tady
9 months ago

Better low paid civil servant must be to the equivalent of US$250 per month.
That increment translates to around US$140 which is very low considering the current turbulent environment.

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