National Railways of Zimbabwe Narrows Salary Arrears

THE National Railways of Zimbabwe (NRZ) is now paying its workers 90 percent of their full salaries up from 50 percent in recent months driven by improved business operational efficiency.

The parastatal has not been able to pay full salaries in the past few years due to operational challenges, which have seen it incurring a salary backlog amounting to over $80 million.

Its operational efficiency improved significantly in the first quarter following the acquisition of rail equipment under an interim arrangement for the $400 million recapitalisation initiative between NRZ and the Diaspora Infrastructure Development Group (DIDG)/Transnet consortium.

Speaking by telephone yesterday, NRZ board chairman, Mr Larry Mavima, said they were optimistic that in the next couple of months his organisation would revert to paying full salaries.

“As a matter of fact, the interim solution, which we introduced, has significantly improved operational efficiency and subsequently revenues. We are now at a point where we are moving 95 percent of all the availed traffic to NRZ, which means that we have less equipment failures and we are able to satisfy all our customers in terms of the traffic that they avail to us,” he said.

“We have also improved significantly our payments to our workers as we are now paying up to 90 percent of their full salaries up from 50 percent. We are hoping that in the next couple of months we will be able to pay full salaries.”

Mr Mavima said Government has also agreed to warehouse outstanding NRZ salaries with the Ministry of Finance and Economic Planning expected to provide the funding.

“NRZ employees will be paid their outstanding salaries and before the conclusion of the joint venture agreement, they will be paid their due arrears,” he said.

As part of the interim solution to capacitate NRZ, the parastatal in February received the first batch of equipment comprising 108 wagons, seven locomotives and seven passenger coaches from DIDG/Transnet. Under the interim arrangement, NRZ is leasing 13 locomotives, 200 wagons and 34 passenger coaches.

Operational capacity at the parastatal had largely been impacted negatively by the unfavourable economic climate Zimbabwe was reeling under for nearly two decades. During its glory days in the 1990s, the strategic logistics entity used to move 18 million tonnes of freight annually but the figure has nose-dived to 3,1 million tonnes in 2017.

Supported by the machinery coming through the aforesaid interim arrangement, the parastatal looks forward to moving four million tonnes this year. With the equipment so far received, Mr Mavima said: “We are able to move everything that our customers such as Zimasco would have availed to us. At Hwange, unfortunately with the problems that they have, we have not been able to move much because of low production at Hwange Colliery Company Limited.”

By the time the $400 million recapitalisation project comes into effect, the strategic entity anticipates moving between 5.3 million tonnes and six million tonnes of cargo annually. As a result of the equipment so far received under the interim solution, Mr Mavima said the parastatal has managed to improve its freight volumes by margins between 35 percent and 40 percent. Financial closure of the $400 million recapitalisation project is expected in July.

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Source: The Chronicle

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