Public servants’ debt spiral

Hungry, debt-burdened government employees are vulnerable targets for criminals, warn unions.

Hungry, debt-burdened government employees are vulnerable targets for criminals, warn unions.

Published Jun 30, 2024


Durban — Government workers are drowning in debt, making them more susceptible to poor work performance and financial misconduct which could affect the state.

This week the Police and Prisons Civil Rights Union (Popcru), the SA Democratic Teachers Union (Sadtu) and the Public Servants Association (PSA) warned that their members were struggling to make ends meet despite a 4.7% increase earlier this year, which was not enough to keep the wolf from the door.

They said the situation was so bad that many public servants had to sell their cars and homes to service their debts. In some instances, they have resigned from their jobs to access money from their pension funds.

According to the National Credit Regulator, the total outstanding gross debtors book of consumer credit for the quarter ended December 2023 was R2.35 trillion. It said R116.05 billion was owed to banks, R6.67bn to retailers, R11.29bn to nonbank financiers and R14.09bn to “other credit providers”.

On Friday Popcru, which represents 160 000 police, traffic and correctional service officers, said the situation had affected their members’ morale, making them vulnerable to wrongdoing.

Popcru spokesperson Richard Mamabolo said they would never condone unethical behaviour and worked hard to create credibility in the services their members provided within the criminal justice cluster. However, anything could happen when someone was desperate, he said.

“From time to time you have cases where members will be tempted to do wrong things. And when you look into what the causal factors are, basically, you get into the challenges around their salaries and their working conditions.”

Mamabolo said because of their money struggles, many of their members, especially police officers, were targeted by criminals.

“Our members, especially within the SAPS … do not qualify for RDP houses, and yet they cannot afford bonded houses because of the salaries they get. Most of them are backyard dwellers and that has obviously led to them being identified as targets in the areas they live in,” he said.

Reuben Maleka from the PSA, which represents 245 000 workers across government, said there was a common notion that public servants were well-paid, but while this might ring true for those employed at parastatals, it did not apply to ordinary government workers.

“The majority of public servants are in a dire situation. There was a survey that shows 85% of public servants’ monthly salary is consumed by having to pay all the debt, so the disposable income left for anything else is around 15%. Some are even asking how they can resign just to ensure that they can recover something through their pension to protect (against) repossession of their assets such as houses and cars.”

Maleka said sometimes government workers couldn’t go to work because they ran out of transport money before pay day.

“You can’t have a hungry police officer who is effective and not vulnerable, because one of the things that creates a difficulty in our society is when a public servant who is hungry faces possible bribery and corruption. That person becomes vulnerable and that creates a problem, not only for that person, but for society. If a police officer had to arrest a law-breaking person and that person had the capacity to bribe a hungry police officer, the likelihood is that police officer might end up being a victim of that bribe, not because this person is intending to do it, but is forced to by circumstances.”

Maleka said this was why the PSA constantly advocated for decent salaries, so public servants were happy with their income and not vulnerable to any kind of fraud, corruption or maladministration.

“Imagine if somebody at Sars would allow a truck carrying illegal goods into the country for the sake of being able to get money to go to work or to buy food. It’s unfortunate: that should not be a good reason for anyone to do it, but it happens.”

Nomusa Cembi from Sadtu said there was a lot of pressure on teachers to support their extended families because unlike the private sector, they were not subjected to retrenchment.

“They have more secure jobs and the private sector is retrenching, so you find that the teacher will be the one to be sustaining their families, and their salaries have to stretch to accommodate families and extended families,” said Cembi.

She said many public servants were not happy with the wage increase unions settled on last year.

“We had to take it because when we surveyed our members they said they did not have an appetite to go on strike because if they did, there is no work, no pay,” she said.

Unions said that while the government had employee wellness programmes, more was needed in terms of financial literacy as well as counselling services to deal with the personal and professional stress faced by their members.

However, CEO of debt counselling company Debt Rescue, Neil Roets, said South Africa’s National Credit Act was one of the most advanced forms of help for over-indebted consumers in the world.

“It assists over-indebted consumers to not remain in that debt spiral but to take a proactive step in finding a way to repay the debt. Most consumers actually want to pay their debt, they just do not have the means, they don’t have the ability, they don’t have the funds,” he said.

“This is where debt counselling comes in and says, ‘okay, you are going to honour it, but you’re going to restructure it legally, albeit over a longer period of time, but instead of ending up just taking another loan’.”

Roets said this enabled consumers to repay the debt, become debt-free, and gave them the ability to re-enter the credit market, access a credit card, a vehicle and a home loan after they’ve completed the debt review process.

“It’s unique in the fact that in South Africa, all your debt can be included as part of this process to protect your assets and give you breathing room to know you have sufficient funds to cover your necessary expenses and not have to worry about taking out another emergency loan to see you through to pay day,” he said.

Independent on Saturday