The government has tried to smooth ongoing remuneration talks with public sector trade unions by tabling a range of U-turn proposals, including awarding South Africa’s 1.2 million public servants a pay hike of 4.5% in 2022.
Instead of agreeing to a 10% pay hike, the government has proposed that it continues to award public servants an after-tax cash gratuity of R1,000 a month in 2022, which would cost the fiscus R20.5-billion. National Treasury has budgeted for the cash gratuity in its 2022/23 expenditure framework, but the 10% pay hike wasn’t.
The first option that the government has proposed is the continuation of the cash gratuity for another year, which was always a safe option to implement if it didn’t agree with public sector trade unions about their remuneration demands. In implementing a pay freeze in the public sector, Treasury wants to wrestle down the cost to remunerate public servants because, at R682.5-billion in 2022, it gobbles up 34% of the government’s total expenditure. Cutting the public sector remuneration bill will also pave the way for the government to reduce its ballooning expenditure and debt.
The unions said this percentage is lowered considering that the government has rejected other proposed remuneration benefits, including a R2,500 increase in the housing allowance afforded to public servants, the introduction of a bursary scheme for their children, relief funds for disaster periods such as Covid-related lockdowns, and measures that allow public servants to easily access pension savings if they fall on hard times.