Public wage bill a major issue for Mboweni, trade unions ahead of Budget speech
Finance Minister Tito Mboweni has made no secret of his intention to slash the bill, which tripled between 2007 and 2019.
JOHANNESBURG - Finance Minister Tito Mboweni will deliver the Budget Speech on Wednesday with the critical issue of the public wage bill still in limbo ahead of a Constitutional Court appeal by trade unions.
His October announcement that government would not be increasing workers’ salaries led to a series of events, including a court battle, however, experts said that a way to cut the bill must still be sought.
Mboweni has made no secret of his intention to slash the bill, which tripled between 2007 and 2019.
But the problem was that efforts to achieve this had not been bearing fruit.
The early retirement plan failed to take off, while the Constitutional Court matter is the culmination of a court battle after Treasury refused to effect salary increases.
The Centre for Development and Enterprise’s executive director Ann Bernstein said: “Throughout COVID-19, many employees in the private sector lost their jobs or had their wages reduced. This hasn’t been the case in the public sector.”
Meanwhile, there were concerns about what the minister could actually do without provoking a deeper fallout with public sector trade unions.
New wage negotiations also mean a renewed fight, with unions arriving at the table with knowledge of Treasury’s intention to slash R160 billion from the bill.
Economic analyst Duma Qubule said: “Government pension fund is over-funded so there are many options as to what the government can do to inject money into the economy.”
The public service employs 1.3 million people.