Mboweni said national and provincial employee compensation budget would be cut by R27 billion over the next three financial years. File Photo: IOL

PARLIAMENT – Government is set to offer voluntary early pensions without penalties for workers between 55 and 59 years of age as it endeavours to cut the wage bill, South Africa Finance Minister Tito Mboweni announced on Wednesday.

Tabling South Africa's national budget in Parliament, Mboweni said national and provincial employee compensation budget would be cut by R27 billion over the next three financial years.

"The public wage bill is unsustainable. We must shift expenditure to investment," he said.

"The first step is to allow older public servants who want to do so, to retire early and gracefully."

According to the budget review document, if about 30 000 of the 126 710 public servants aged between 55 and 59 take up this offer, it could save the government around R20.3 billion.

Details of the early retirement framework will be released by Public Service and Administration Minister Ayanda Dlodlo this week.

African News Agency (ANA)