South African Municipal Workers Union members protest. Picture: THE HERALD/MIKE HOLMES
South African Municipal Workers Union members protest. Picture: THE HERALD/MIKE HOLMES

Emboldened by the above inflation wage increase it got in Tshwane last week, SA municipal Workers Union (Samwu) members marched on the Ekurhuleni metro offices on Monday demanding a similar increase.

Samwu deputy general secretary Dumisane Magagula told Business Day that their protests would “spread like wildfire” across the country if municipal bosses did not stick to a wage agreement crafted at the SA Local Government Bargaining Council in 2018. Municipalities in the Eastern Cape, Free State and Mpumalanga have already implemented the 6.25% wage agreement.

The wage increase is about three times the consumer price inflation of 2.1% recorded in May, breaching the upper end of the SA Reserve Bank’s 3%-6% target range.

On Friday, the SA Municipal Workers’ Union (Samwu), an affiliate of ANC ally and trade union federation Cosatu, flexed its muscle and successfully forced administrators of the Tshwane metro to implement the 6.25% wage agreement.

The administrator of the Tshwane metro Mpho Nawa on Friday said the 6.25% increase will increase the city’s wage bill by R45m every month. It was due on July 1 2020.

This will also have big implications for municipalities as their finances took a knock during the lockdown due to low revenue collection. In April, President Cyril Ramaphosa extended an additional R20bn to municipalities, as part of the R500bn social and economic relief package for SA. Municipalities are at the coalface of service delivery and the government's response to the Covid-19 pandemic which has infected more 445,433 people and killed 6,769 to date.

The pandemic has seen the government order a strict national lockdown, shutting down businesses, schools, closing down borders and banning interprovincial travel as well as air travel.

Magagula warned those municipalities that intended to disregard the agreement that they were “skating on thin ice” and were at risk of undermining “sacred” collective bargaining agreements.

“We know the impact of Covid-19 on municipal finances, but we don’t believe these institutions have run out of money to implement these increases,” said Magagula.

“We are warning them that their decisions will bring halt to municipal services that have to go communities. We are sorry that communities will have to suffer because of the decisions of municipal bosses,” he said.

Ekurhuleni metro spokesperson Themba Gadebe said he will respond later on Monday.

Karen Heese, an economist at Municipal IQ, a web-based data and intelligence service that monitors and assesses SA’s 257 municipalities, said the demand for 6.25% wage increase “ignores the perilous state of municipal finances when there are already very clear signs of distress due to diminished revenue”.

“[The narrative that] ‘you-can-find-the-money-if-you-look-for-it’ is of course an argument that is supported by incidents of abuse of municipal funds,” said Heese.

“Industrial action — especially where it is violent and disruptive, as in Tshwane last week — is likely to be greeted as tone-deaf by the public which is beset with retrenchment, furloughing etc,” said Heese.

Econometrix chief economist Azar Jammine said he doesn’t know what Samwu’s objectives are. “Do they want to bring down the government? There seems to be a contradiction because it appears they want to disrupt the economy as much as possible,” said Jammine.

Samwu members were in a “privileged position” because they still have jobs while workers in the private sector have lost theirs or had their salaries cut due to Covid-19.

“They are demanding a wage increase that is way above inflation. The 6.25% they are demanding is three times the inflation rate at the moment. They don’t seem to care that their brothers and sisters in the private sector are losing their jobs,” said Jammine.

“Not only are they demanding higher wages, but most municipalities have been run inefficiently and corruptly. All of this points to a collapse in the economy.”

In his recent report on the municipal audit outcomes for 2018/2019, auditor-general Kimi Makwetu stated that only 21 of the 257 municipalities in the country achieved a clean audit, with irregular expenditure accounting for R32bn, while more than R1bn was spent on consultants.

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