Rate of salaries increases for public servants worrying - CDE

The organisation detailed how government could reduce spending while placing immediate attention on reducing waste.

FILE: Public Servants Association members picketing in Johannesburg. Picture: @PSA_Union/Twitter.

JOHANNESBURG - As the government reviews its spending model, with its sights set on the size of the public service wage bill, the Centre for Development and Enterprise (CDE) said more attention needed to be paid to salaries.

The organisation detailed how government could reduce spending while placing immediate attention on reducing waste. This was contained in a report released on Wednesday on the state of public finances.

The list of tasks and hard decisions the government had to make to turn the declining economy around was long. The recommendations contained in the CDE’s report included proposals on fixing state-owned institutions and providing reliable and affordable energy.

On the public service, the report stated that it was not the size but the rate of increases of public servants’ salaries that was a problem.

“Something like that is more of a symbolic gesture and an indication to the private sector that ‘look we are committed to doing something as the state’ … and the expectation is that you’re trying to respond to society that times are tough,” said CDE research fellow Lumkile Mondi.

Treasury officials suggested that salaries of public servants be cut by 10%, while the government was carrying out early retirement settlements in an effort to curb spending.

The CDE said while this boded well for an image of a government that took the economic crisis seriously, a range of other actions had to be taken.