Treasury wants increases that ‘protect civil servants’ buying power’

2015-04-03 11:13

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Cape Town - The national treasury is still seeking public service salary adjustments that are in line with the consumer price index (CPI) after a significant period of “above-inflation” increases, says Finance Minister Nhlanhla Nene.

According to Nene, Democratic Alliance finance spokesperson Dion George had asked what the director-general of the national treasury had meant by reaching “a fair, sustainable public-sector wage agreement that protects the purchasing power of public servants”.

“The government is committed to containing costs and improving composition of expenditure. The period between 2007-2008 and 2012-2013 was characterised by worsening composition of expenditure in favour of compensation of employees,” Nene explained yesterday.

This was largely as a consequence of “significantly above-inflation wage settlements, introduction of occupation-specific dispensations and increases in personnel growth even during times of economic turmoil”.

He explained that fair remuneration “is that which compensates employees for the value created in delivering public services”.

A wage agreement that protected the purchasing power of public servants was that which ensured that the standard of living of public servants remained unchanged “in face of an increase in the cost of living”.

This was achieved through implementing “cost of living adjustments that are in line with changes in the CPI, which provides a comprehensive measure of changes in the cost of living”.

The government declared a dispute last Friday, after months of negotiations with public sector unions. Now a 30-day mediation process kicks in, after which the unions could go on strike.

A three-year wage agreement affecting 1.3 million bureaucrats expired on Wednesday.

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