Dealing with the bloat

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

Margaret 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 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