Progress made in reducing public servants' wage bill
Politics / 9 July 2019, 08:05am / MAYIBONGWE MAQHINA
Cape Town - Public servants qualifying to take early retirement from the public service before they reach the age of 60 have until the end of September to do so.
This was revealed by Public Service and Administration Minister Senzo Mchunu in a written reply to the IFP’s Mkhuleko Hlengwa.
Hlengwa had enquired whether the department had made any progress in reducing the public wage bill.
Delivering his budget speech earlier this year, Finance Minister Tito Mboweni said they wanted the public wage bill reduced by R27billion over the next three years. Early retirement without penalties has been identified as one of the measures to reduce the wage bill, along with limits on overtime and bonus payments.
In his written response, Mchunu said the economic realities and financial pressures faced by the country were discussed with organised labour during and after last year’s wage negotiations.
“The purpose was to jointly look at tangible measures going forward, to remain within the budgetary ceiling without negatively affecting job security, as well as ensuring the continuous efficient and effective functionality of departments within the Medium Term Expenditure Framework (MTEF) and beyond,” he said.
Human resources-related areas aiming to reduce the public service wage bill had been jointly identified by his department and the National Treasury.
The minister named the granting of early retirement without penalties after the Public Service Act was amended to provide for a minister to allow an employee at his or her request to retire before reaching the age of 60.
Mchunu said it was in response to a need identified by employees who wished to exit the public service before the official retirement age of 60.
He said a five-month period had been opened for early retirement applications three months ago.
“The provision for applications for early retirement, where the National Treasury provides funding support to departments, is limited to the period April1 to September30.
“An assessment will therefore be conducted to determine whether a further need for financial support for early retirement is required by departments.”
Mchunu added that ministers had been encouraged in the last term to align their organograms with budgets and to create posts within available funds in the MTEF.
“Furthermore, executive authorities were encouraged to only fill critical posts.”
Mchunu said a strategy to decrease the percentage of a department’s allocated remuneration budget for the payment of performance rewards had been developed together with the National Treasury.
“Departments may not utilise more than 1.5% of their annual remuneration budget for the payment of performance rewards.
“The Department of Public Service and Administration and the National Treasury will monitor public service wage expenditure to identify new and further areas for potential savings,” he said.