Heads of Departments advised to sensitize on debt swap recovery

Government and labour unions have agreed to discontinue the debt swap and restructuring initiative due to non-availability of resource to sustain  the exercise.

Zambia Union of Nurses (ZUNO) president Tina Chiponda discloses that government will  therefore start recovering money from the civil servants who benefited from the debit swap last year in July and August, 

Ms Chiponda, says following government and stakeholders’ decision on debt swap, civil servants have to pay monies owed through deductions from July month-end.

Speaking during a meeting to disseminate content of the addendum of the 2022 collective agreement between the government and the 15 public service unions in Chavuma Town , North-western province,  the ZUNO president further urged civil servants that are owed by the government  to be proactive as the deductions commence in July.

“Those people that benefited from the debit swap for two months or more last year, the government will ensure it makes its recoveries, although it will not be done in one or two months but for a period of 12months. Currently government is analyzing the debt that they owe people in terms of settling in allowance, rural hardships those will not face any recovery, therefore ensure you are proactive by checking your pay slips so that no deductions are made, if at all you notice any go to your human resource, put it in writing and send to headquarters,” she said.

She said the reasons for halting the debt swap are because the government needs over K 5 billion to cover for all its employees which the financial sector said is not in the budget pipeline.

“The new dawn government through PSMD, said that the scheme cannot be sustained as the scheme in its current status form reflects five billion seven hundred and seventy million kwacha to cover for employees.

“It cannot work because the government would get into credit by borrowing K 577 billion per month  to pay civil servants. This has become more unsustainable with the additional 30, 000 and 11 , 000 to be recruited,” Ms. Chiponda disclosed.

The labour movement has since embarked on a campaign to inform civil servants nationwide on the debt swap recovery and has since advised heads of departments to share the information with their junior officers.

Last year, the Patriotic Front (PF) administration initiated the debt swap arrangement, where it pledged that it would settle debts owed by thousands of civil servants who had obtained loans from various financial institutions.

In September 2021, Government suspended the debt swap scheme and called for consultations on the matter which has led to its cancellation due to financial implications.

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