Minister Senzo Mchunu briefs media on the announcement of the newly elected Chairperson and Deputy Chairperson of South African APRM National Governing Council. [Photo: GCIS]
CAPE TOWN, July 27 (Reuters) – The majority of public sector unions in South Africa have signed a one-year wage hike deal, a cabinet minister said on Tuesday, as government looks to cut a huge spending bill and boost economic prospects worsened by the COVID-19 pandemic.
When talks started in March, public sector unions representing more than 1 million teachers, police and nurses, wanted a salary hike of consumer inflation plus 4% for all workers in the 2021/22 fiscal year.
Government offered zero increase at the outset, but changed tack during a conciliation process after parties deadlocked and labour threatened strike action.
In July, Public Service and Administration Minister Senzo Mchunu offered civil servants a 1.5% salary increase plus a cash payment, which the majority of unions, including the South African Democratic Teachers Union and the Public Servants Association, accepted on Monday.
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“Thank you for your leadership, thank you for negotiating with the interests of public servants and the citizens at heart,” Mchunu said in a statement welcoming the deal.
The government is trying to contain its wage bill, which accounts for about a third of consolidated spending and which has risen quickly in the past decade.
The huge wage bill has been flagged among major concerns for credit-rating agencies that already rate the sovereign as “junk”.
(Reporting by Wendell Roelf; Editing by Edmund Blair)
