Reuters reports that Finance Minister Nhlanhla Nene said on Tuesday that SA would struggle to stick to a promise to cut spending if the government failed to agree inflation-linked wage increase with public-sector trade unions.  

Plans to reduce government spending helped to avoid a damaging credit rating downgrade by Moody’s in March, but the promised cuts provoked criticism from unions amongst others.  The government and public-sector unions representing teachers, nurses and the police and others have been locked in negotiations over wage increases since late 2017.  Unions are lobbying for above-inflation pay rises of about 12%, while government has tabled offers linked to consumer inflation, which currently stands at 3.8%.  Last month the Public Servants Association (PSA) declared a wage dispute with government, while unions affiliated to Cosatu have also threatened to pull out of negotiations.

• Read this report by Wendell Roelf and Mfuneko Toyana in full at BusinessLive

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