Parliament adopted the Employment Tax Incentive Bill yesterday as the Treasury prevailed in its three-year battle with the trade union movement over a youth wage subsidy.
Although all opposition parties voted in favour of the bill, they said the stand-off had watered the measure down, let down jobseekers and undermined the Nedlac negotiating forum for the government, business and labour.
“While this bill was stuck at Nedlac, 218 000 young job seekers joined the ranks of the unemployed. That is the price of [Cosatu] delay,” DA finance spokesman Tim Harris said.
Harris said the cost of the ideological battle in the ruling alliance was evident in the R1.3 billion tax break the wage subsidy would give employers, down from R5bn when it was first mooted by Finance Minister Pravin Gordhan.
“It is a good day for young people. That said, it could have been a much, much better day, because the version of the subsidy before this house is significantly watered down from the version tabled in the 2011 policy,” he said.
Cosatu opposed the subsidy, arguing that it would encourage employers to fire experienced workers and replace them with younger ones to receive the tax concession.
Cope spokesman Nic Koornhof said the passage of the bill was a clear sign that the labour federation’s influence within the tripartite alliance was on the wane. – Sapa