South Africa Cancels Promised Wage Increase, Angering Unions

T. Mboweni

Promises promises. I’m all through with promises promises.

That’s the Dionne Warwick tune South African public servants will be singing bitterly if a three-year wage deal signed in 2018 is headed for the recycling bin. The promised wage hike was due to start next month, April 2020.

President Cyril Ramaphosa, in his weekly newsletter, said that cutting the government’s wage bill was a better deal than trimming state spending.

Cutting state spending was “a path to austerity,” he warned. “Such a route would see deep cuts in the social services that poor people rely on. It could involve dramatically reducing the salaries of civil servants, the size of the public service, cutting bonuses and pensions, raising taxes and selling off key state assets,” he said.

Finance Minister Tito Mboweni said these times of low economic growth, a rising budget deficit and record-high unemployment necessitated the wage rollback.

South Africa is in a difficult fiscal position, he said. “[But] we are not at a point of austerity; we are at a point of cleaning up our house.”

But these conciliatory words failed to mollify the 2.161 million government workers in NEHAWU, one of the largest members of the COSATU trade union federation allied with the governing African National Congress.

It’s a “declaration of war”, a furious NEHAWU declared. Rewriting the terms of the 2018 deal was an “irresponsible and blatant act of provocation”, to be met with a government shutdown, rendering the system ungovernable.

The proposal is “malevolent”, said the Police and Prisons Civil Rights Union (Popcru). “Workers are being made scapegoats for the sins committed by many who continue to roam our streets after years of looting state resources”.

A showdown is set for this week with COSATU urging the president to rein in Finance Minister Mboweni who plans to slash the public sector wage bill by 160.2 billion rand ($10.3 billion U.S.) over three years.

President Ramaphosa now finds himself between a rock and a hard place – either he supports the finance minister he chose to rescue the country’s finances or the trade union federation which, together with the South African Communist Party, has been his most solid ally in the ANC.

In terms of the agreement, salaries are due to increase up to 7% on April 1, depending on job grade.

SOURCE: Global Information Network

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