State wage bill reaching ceiling

No room for raise for civil servants

Finance Minister Malusi Gigaba has warned that some government departments are at risk of breaching their ceilings on public servant salaries.

Tabling his maiden national budget in the National Assembly yesterday, Gigaba said he expected departments to continue “carefully managing” how they hired new employees and the salaries of existing staff as the state struggles to rein in its public-sector wage bill amid a plummeting tax revenue.

Gigaba said the compensation ceilings at national and provincial departments had been reduced by R10-billion in 2017 and it was projected they should not exceed R15-billion in the 2018-2019 financial year.

His budget documents indicate the government was not budgeting for huge salary increases, but for public-sector salary increases not above the prevailing inflation rate, currently hovering around 4.4%.

“As a result of these adjustments, and a generally tighter fiscal environment, total national and provincial headcount growth had declined. Nevertheless, some national departments are at risk of breaching their compensation ceilings.

“Departments will need to continue paying careful attention to managing head-count levels. Government is working to ensure that the current wage negotiations process results in a fair and sustainable agreement.”

Public-sector trade unions, which are in wage negotiations with the government, have demanded salary increases of up to 10% for their members.

Government is currently spending just above R587-billion on its public-sector wage bill and this was projected to rise to R630-billion by 2020.