South Africa’s Treasury Targeted by Workers Seeking Higher Wages

Thousands of South African state workers marched to the National Treasury’s offices in the capital, Pretoria, on Thursday to demand that it agree to their demands for 10 percent wage increases and improved benefits.

The government offered its 1.3 million employees raises equal to the consumer-inflation rate plus 1 percentage point raises for the year that began April 1, leading to a deadlock in wage talks. South Africa’s inflation rate was 4 percent in March.

“We believe that the Treasury is the one who pulls the strings at the negotiating table,” Norman Mampane, a spokesman for the Congress of South African Trade Unions, said by phone from Johannesburg. “The employer must come back to the negotiating table with a revised offer. We are perturbed by the bad faith displayed by the employer.”

State personnel costs have surged 90 percent to 445.3 billion rand ($36.3 billion) since 2009 and account for almost 36 percent of total government expenditure, Treasury data shows. The Feb. 25 budget provides for the wage bill to rise by an average 6.6 percent in each of the three years through March 2018.

Granting 10 percent raises would add 20 billion rand to the state wage costs that hadn’t been budgeted for, according to Finance Minister Nhlanhla Nene.

“Given the current economic constraint coupled with high government debt, there is limited scope to provide more resources” for wages, he said in a written reply to a parliamentary question on March 20. “Any departure from the path of consumer price inflation-linked cost-of-living adjustments cannot be financed through debt issuance and will therefore require either a reallocation of resources from other spending areas or prompt a need to reduce government employment.”

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