FINANCE Minister Enoch Godongwana refused to be drawn on measures to be taken to deal with the public sector wage bill, which the National Treasury has identified as one of the risks to the fiscal framework.
“In so far as the wage bill is concerned I refuse to take a definite position about what is to be done.
“What I am stating across is that the wage bill is high,” Godongwana said.
He made the comment on Thursday when he briefed the joint meeting of the parliamentary committees on finance and appropriation on the budget he tabled in Parliament on Wednesday.
In his budget speech the minister identified pressures from the public service wage bill as one of the significant risks to be mitigated.
In its budget document, the National Treasury said the government wanted to reduce the pressure exerted on the budget.
“These efforts have successfully reduced the rate of growth in the wage bill,” it says.
The National Treasury said the public service compensation spending increased by R20.5 billion in 2021-22.
It says the higher than budgeted compensation increases and or a decision by the Constitutional Court to uphold the appeal related to non-implementation of the final leg of the 2018 wage agreement posed a fiscal risk.
ANC MP Kenny Morolong said there should be an effort to keep the wage bill under control.
“How do we intend to deal with the public service wage bill?” he said, adding that there was payment of gratuity last year to civil servants to make up for the non-implementation of the wage agreement.
“What is the exact plan for this year and for the medium term plan,” Morolong asked.
In his response, Godongwana said there was disagreement about what caused the public wage bill to be high.
He said there would be a summit in March to identify what caused the high wage bill and emerge with a solution.
“I may be accused if I put a definite position that I will be negotiating in bad faith,” Godongwana said.
However, the National Treasury has in the budget documents stated that a new round of collective bargaining would begin in March.
It said it was working with the Public Service and Administration Department to keep the compensation baselines within affordable limits.
“As indicated in the 2020 budget, the compensation baseline will grow at the rate of inflation from 2024-26.
“Should collective bargaining result in salary adjustments that exceed compensation ceilings, reductions in headcount will be required.”
The National Treasury also said the 2021 wage agreement awarded civil servants a non-pensionable cash gratuity.
“In the absence of a new agreement, the same gratuity will be paid in 2022-23 and provision for this is made in the 2022 budget,” the budget review document said.
POLITICAL BUREAU