Government revises salary offer

Thursday, August 5, 2010

Pretoria - Government has revised its initial salary offer to public servants from 6.5% to 7%, Public Service and Administration Minister Richard Baloyi announced on Thursday.

The revised offer of 7%, the unchanged housing allowance of R630 and the fixed pay progression of 1.5 % will amount to a total average contribution of 9% for public servants at salary level 1 to 12.

However, the minister said the adjustment was above what government could afford and could put strain on service delivery and job creation in the public service. "These increments are not sustainable and should be understood in the context of government's commitment to find solutions even in difficult times."

He said the increased salaries were above inflation and would further stretch government's wage bill, which had already been heavily impacted by the settlement of the Occupation Specific Dispensation (OSD).

"It is above our state of affordability... This poses a serious threat to sustainability," said Baloyi, adding that government would have to reprioritise some of its priorities and look at "what we can forego".

The revised offer was still being considered by unions. Government and union representatives are currently at the Public Service Co-ordinating Bargaining Council (PSCBC) discussing the new offer.

The minister said there was a need to change the way in which wage negations take place in the public service. Salary negations should be synchronised with government's budget cycle, the implementation month for salary settlements should return to April and a multi-term focus in salary negotiations needs to be introduced.

Baloyi agreed that the housing allowance did not meet the current needs of public servants who want access to housing and said further engagement on this should take place during a second phase of negotiations.

"I make a call to trade union formations to accept this offer as failure to do this will compromise us further. Our doors remain open for the issue of housing in a second phase of negotiations," said Baloyi.

He said the "sooner we put this behind us the better for government as the employer, the employees and South Africa".

Cosatu has meanwhile issued a notice to the employer that its members will down tools on Tuesday.

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