Fin24 reports that Michael Sachs, deputy chair of the Finance and Fiscal Commission, says the fact that National Treasury did not budget for public-sector wage increases this year was not realistic or credible.

Speaking on Wednesday, Sachs, who is also a professor at Wits University, said he disagreed with the National Treasury's claim that the public wage bill would result in an additional R37.4 billion expense it did not foresee. Treasury warned in March that the 2023/24 and 2024/25 wage deal signed earlier that month would require that significant trade-offs be made. The wage deal includes a 7.5% increase for 2023/24 and a CPI-linked wage increase for 2024/25. Treasury said it would cost the government an additional R37.4 billion in the current fiscal year because the deal was not provided for in the February budget. But Sachs believes that for Treasury to term this as an "additional" or unbudgeted expense, implies that it factored a zero percent increase in salaries of all public servants in a high inflation environment. "I don't think that was ever realistic or ever credible," said Sachs. He argued the National Treasury was increasingly using the budget as a negotiating tool instead of an actual estimate of what the government will spend each year. He also cautioned that the 7.5% figure only amounted to an increase of 3% as 4.5% of the increase replaced the non-pensionable gratuity that workers had received for the past two years. According to Sachs, public servants have faced a persistent real fall in their income since 2020. And for three to four years now, public doctors, teachers, nurses and police in SA have been worst off.

• Read the full original of the report in the above regard by Londiwe Buthelezi at Fin24

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