BUILDING RESEARCH
Bloated staff hold state to ransom but experts see positives in spend
It is bad out there, but maybe not as bad as it seems. That is the message from a BMI Building Research Strategy Consulting Unit summit in Johannesburg on Friday. BMI tracks the state of the country’s construction industry. Make no mistake, the negatives weighing on SA’s economy are extremely gloomy. Azar Jammine, director and chief economist at Econometrix, says government borrowings are growing faster than GDP growth. This is ringing alarm bells at ratings agencies, and comes as SA faces a R54bn tax shortfall. Meanwhile, the state has become extremely bloated in recent years. The Eton Group, formerly BDO Consulting Services, in an analysis of Eskom’s financial statements published in July, shows that apart from paying McKinsey and Trillian irregular fees of R900m and R495m, respectively, the utility’s spending on employment benefits has shot up since the 2013-14 financial year. Annual and performance bonuses increased 98% from 2016. This translates to an annual performance bonus o...
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