South Africa Risks Union Ire With Pay Freeze to Tame Debt
- Government wants to freeze civil servants’ pay for three years
- Fiscal consolidation pushed out, with debt set to peak in 2026
Members of Congress of South African Trade Unions march during a nationwide strike on Oct 7.
Photographer: Phill Magakoe/AFPSign up to our Next Africa newsletter and follow Bloomberg Africa on Twitter
South Africa risks a public backlash and political upheaval after releasing a budget update that will freeze civil servants’ pay for three years and reduce other spending to tame runaway debt.
The proposed spending curbs are the clearest sign yet that President Cyril Ramaphosa’s government won’t back down from a fight with politically influential labor groups representing 1.3 million state workers, even as it prepares for municipal elections next year. The Congress of South African Trade Unions, the largest worker federation, is already up in arms because the state reneged on a previous pay deal and has warned that a long-standing alliance with the ruling African National Congress could unravel.