South African trade unions dig in for fight over public sector wages

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By Agencies

South African trade unions are digging in for a fight over public sector wages, after they rejected the government’s latest attempt to renegotiate a previously agreed pay increase for the fiscal year starting in April.

During talks at the Public Service Coordinating Bargaining Council on Tuesday, government negotiators proposed no increase for civil servants’ salaries on April 1, the NEHAWU and PSA unions told Reuters.

The government had previously agreed to pay civil servants wage increases of projected inflation plus 1% for workers on the lowest salaries, inflation plus 0.5% for the next level up and inflation for higher levels. Inflation is currently at more than 4%.

It is trying to renegotiate the April wage increase to contain a rising budget deficit and preserve the country’s last investment-grade credit rating from Moody’s, which is scheduled for review next week.

“We vehemently rejected the proposal,” NEHAWU General Secretary Zola Saphetha told Reuters, adding that the union was preparing for a march to warn the government not to renege on the agreed wage increase.

PSA official Reuben Maleka said his union was prepared to go to court to enforce the wage increase agreed in 2018 as part of a three-year deal.

Vukani Mbhele, spokesman for the ministry that is leading the talks with unions, confirmed that a meeting had taken place on Tuesday but declined to elaborate.

Finance Minister Tito Mboweni said in his annual budget speech last month that he wanted to make roughly 160 billion rand ($9.6 billion) of cuts to the public sector wage bill over the next three years.

But some analysts are sceptical that he will achieve those cuts.

Moody’s said in a research report last month that it saw risks to Mboweni’s budget forecasts because of uncertainty over the negotiations with unions.