Pretoria - NATIONAL Treasury is sticking to its guns to cut the public sector wage bill and maintains that its proposals to freeze salaries for public servants should be viewed in the context of the tough economic conditions facing the country.
Acting head of the budget office in the National Treasury, Edgar Sishi, told MPS yesterday that they want to freeze wages for workers in the public sector.
Finance Minister Tito Mboweni told Parliament last week when he tabled the Medium-term Budget Policy Statement that treasury wants to cut the wage bill by R300 billion over the next four years.
Mboweni also said they wanted to reduce the salaries for ministers, MECS and councillors to free up funds in the fiscus due to the escalating debt and budget deficit.
Sishi told MPS the wage bill had been escalating over the last 15 years. "We have shifted from a situation where public servants receive an increase less than economic growth to a situation where now public servants receive an increase in their salaries that noticeably outstrips economic growth." South Africa was in a tight fiscal space, if something was not done it would worsen the situation.
"We consider that we, as government, need to take a hard look at ourselves about the fiscal position we are in. It's not always appropriate to make these kinds of comparisons, but if you run a company and you have the kinds of numbers that we have at the moment, you'll make very different types of decisions than some of the decisions you have made in the past," said Sishi.
The aim is to cut R60bn in 2021/22, R90bn in 2022/23 and R150bn in 2023/24 from the public sector wage bill, starting with not implementing 2020 increases that were part of a 2018 wage agreement.
Cosatu and its affiliates have rejected the proposals to freeze salaries.
The National Education, Health and Allied Workers’ Union is planning major strike action in Pretoria and Cape Town on November 26 in response to the government’s decision to freeze public-sector wages.
Pretoria News