Cyril Ramaphosa. Picture: GCIS
Cyril Ramaphosa. Picture: GCIS

The Ramaphosa administration knows it faces its Thatcher moment, ironically with the very same sector: coal and power.

Thatcher invoked force to break the unions. That is not an option for us. How then to mend the short-circuit? We read that 29,000 public servants earn more than R1m annually, consuming R29bn of state expenditure. Three factors drive the size of this expenditure: bloat, riding on union power, and above-inflation salary increases.  

Lest one forget, a 7% increase on a R900,000 package is very different to 7% on R60,000. So the first step is to limit salary increases to 1% for the ranks of director upward (that takes care of the 29,000). Then negotiate step increments going down to the lowest-paid who would receive the consumer price index increase. This achieves two goals: reducing the overall bill and reducing wage inequality. Run with this for five years and a real difference will be made, with the private sector to follow suit.

My guess is that South Africans would support this move.

Michael Kahn
Cape Town

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