Budget Speech 2021: Public sector wage cuts in focus ahead of Mboweni’s speech

Budget Speech 2021: Public sector wage cuts in focus ahead of Mboweni’s speech
Budget Speech 2021: Public sector wage cuts in focus ahead of Mboweni’s speech

Africa-PressSouth-Africa. Cape Town – Whether or not Finance Minister Tito Mboweni will announce far-reaching public sector wage cuts is the main point ahead of his Budget speech, according to forecasts from economists, political analysts, unions, business and farmers’ groups.

Economist Dawie Roodt said: “Minister Mboweni’s Budget is not going to be a pretty picture, as the state is falling apart financially. He must cut spending on the public service wage bill or at least slow it down considerably, but will he be able to get away with this politically? That is the crux of the matter.

“I fear Mboweni’s role has been marginalised by the president and Public Enterprises Minister Pravin Gordhan. For example, when Mboweni said he couldn’t spend on SAA, Gordhan and the president appeared to overrule him.”

Political analyst Ralph Mathekga said: “Let’s not expect miracles. Budgets fund political priorities and at this point it is not possible to clearly establish the government’s political priorities.

“They talk about reforms and about fighting corruption, but there is no clarity about what will happen with SAA for instance. Is there any intention to streamline the public sector wage bill?

“People will be looking for a public sector wage cut, but if Mboweni does that, the government will face big problems with the unions.”

Provincial Cosatu spokesperson Malvern De Bruyn said: “The government needs to remove the imposed wage freeze that has been proposed for the next three years.

“The national Treasury needs to reduce the size of salary packages paid to politicians and senior managers. Stop wasteful expenditure that leaks about R150 billion from the fiscus, annually.

“The state of deterioration and collapse of many SOEs (state-owned enterprises) is destroying the lives of innocent workers. Bold job-creation targets for each department, entity, SOE and municipality are needed.”

Business Leadership SA chief executive Busi Mavuso said: “We need to be investing in a state that can manage a growing economy and efficiently deliver public services to all South Africans. We should be cutting wasteful spending that delivers poor value for money and focusing on investment in infrastructure and wider state capacity.”

FNB economist Mamello Matikinca-Ngwenya said: “The tax base has undeniably shrunk, with people having lost jobs and incomes from lay-offs and reduced working hours, and some businesses having partially or entirely shut down.”

SA Informal Traders Alliance national president Rosheda Muller said: “When it comes to engagement, the government is all too eager to engage with big business. What about small business? It is high time that the government consults with traders on the impact of your decisions on an important constituent. Nothing about us, without us.”

Agri SA head of economics Kulani Siweya said: “Mboweni has a lot of pressure on him to make sure that South Africa’s books balance. If he wants to grow the economy, the agriculture sector is the key.”

The president of farmers’ union TLU SA, Henry Geldenhuys, said: “If Mboweni wants to present a reasonable Budget, he can focus on cutting government expenditure; Implementing proper plans to pay off state debt; and banning salary increases for state officials until the economy is growing again.”

Cape Argus


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