Public servant pay negotiations ‘on track’

2012-06-26 09:54

Unions representing about 1.3 million South African state workers and government have narrowed differences on a wage deal, nearing a settlement on pay rises that could add more than $1 billion (about R8.5 billion) to budget spending.

A union official today said government had offered a three-year deal with a 6.7% increase for this year, with second year increases of inflation plus 0.7% and third year increases of inflation plus 0.5%.

“Negotiations seem to be back on track,” said Chris Klopper, spokesperson for the Independent Labour Caucus, one of the more than a dozen unions in contract talks with the government.

Talks over pay increases broke down last week, raising the threat of a strike that could shut hospitals and schools. Government had offered a 6.5% wage increase this year while unions were looking for a figure over 7%.

Public services minister Lindiwe Sisulu said last week the 6.5% offer would swell spending and cost the government about R10 billion more than had already been set side.

Wages for government employees are the largest sector of state spending, equivalent to more than 40% of tax revenue. A perk to provide civil servants with about $100 a month to help them with housing ends up costing South Africa as much each year as its court system.

Union officials said the government is looking to cut the amount it spends for housing allowances, which could pose a stumbling block.

Talks are set to continue but no date has been given for the next bargaining session.

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