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BL Premium reports that according to national Treasury, a cash offer to government employees, which was improved upon last week, will cost the government some R18bn that has not been budgeted for. So the shortfall will have to be sliced from departmental budgets to avoid busting the fiscal framework.
In wage talks on Friday, the government made an improved offer to public sector unions for the 2021/2022 year. It included a 1.5% pay progression increase (an increase linked to years of service) and a monthly cash gratuity on a sliding scale of between R1,220 and R1,695. The sliding scale will ensure that all employees receive R1,000 after tax. While the 1.5% pay progression is factored into budget projections for the next three years, the cash gratuity is not. Treasury acting head of the budget office Edgar Sishi said the previous offer made to unions for a R987 gratuity would cost about R14bn and the increased version would add another R4bn to R5bn. Sishi said in an interview: “Our approach has been to recommend to the ministers involved in negotiations that employees receive the 1.5% and no more. However, if for any reason at a political level the view was that more was required to reach an agreement then whatever that offer was would require sacrificing other things to pay for it. There is no way we could bust the fiscal framework for public servants. That would be a fiscal choice that is negative.” Briefing the media on Monday, public service & administration minister Senzo Mchunu described the offer as “reasonable” under the circumstances. Mchunu calimed the government was “operating within the fiscal framework [and] we won’t deviate from that. Where we will get the money after signing the agreement, we will discuss and find a solution to that.”
- Read the full original of the report in the above regard by Carol Paton and Luyolo Mkentane at BusinessLive (paywall access only)
Get other news reports at the SA Labour News home page