Cosatu members. Picture: REUTERS
Cosatu members. Picture: REUTERS

In this edition of the Business Day Spotlight, the publi- sector wage bill is in focus as finance minister Tito Mboweni is set to give his national Budget Rpeech for the year on Wednesday February 26.

Our host Mudiwa Gavaza is joined by Matthew Parks, parliamentary co-ordinator for union federation Cosatu to discuss some of the options available to the Treasury in its efforts to cut costs.

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With Mboweni expected to cut as much as R150bn in spending over the next three years, a number of economists have flagged the public-sector wage bill as one of the few things that the government can address to achieve these savings.

The public-sector wage bill currently makes up about 35% of the national budget.

Matthew Parks. Picture: TREVOR SAMSON
Matthew Parks. Picture: TREVOR SAMSON

Parks says that in 1994 there were about 1-million people in the employ of the state. By 2020, this has gone up by about 10% to 1.1-million people, despite the country’s population going up by more than 40% since SA’s independence. He also highlights that there has been a slight decrease of 2% per annum over the past few years, citing private-sector companies tending to have a greater proportion of their budgets and spending geared towards staff.

Instead of cutting jobs, Cosatu says there are other avenues that can explored. For example, Parks says it wants to see greater control of wasteful spending and corruption, as well as a better capacitated Sars, among a host of measures, before public servants’ salaries are targeted. He argues that potential wage freezes for high-income earners in the public sector, for example, could help save the state a lot of money.

Cosatu has also called for all state agencies to be placed under the Public Service Co-ordinating Bargaining Council, so that all workers affiliated with the state can jointly bargain for wages.

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Business Day Spotlight is a MultimediaLIVE production.