Unions edgy after wage talks delay

Wage war: Unions fear Public Service Minister Ayanda Dlodlo won’t keep promises made by her predecessor. (Ntswe Mokoena, GCIS)

Wage war: Unions fear Public Service Minister Ayanda Dlodlo won’t keep promises made by her predecessor. (Ntswe Mokoena, GCIS)

Public sector unions are bracing themselves for a stand-off with the government because they fear Ayanda Dlodlo, the new minister of public service and administration, will present a lower wage offer than the one put on the table by her predecessor, Faith Muthambi.

Muthambi was removed by President Cyril Ramaphosa in a Cabinet reshuffle in February.

The public service wage bill accounts for more than a third of government spending and the government is under pressure to keep its costs down. The three-year sectoral wage agreement comes to an end on Friday March 30.

Union representatives say there are rumours that the offer of the consumer price index (CPI) plus 1.5% will be dropped to CPI plus 1%.

The parties are due to meet again on April 4 and 5.

Muthambi offered civil servants a three-year wage deal, with CPI plus 1.5% in the first year, and CPI plus 1% in both years two and three. But the meetings were adjourned pending the treasury’s CPI projections for the next two years.
The offer was also made before the announcement of the 1% value-added tax (VAT) increase.

Workers have demanded CPI plus 3% in the first year, CPI plus 2% in the second year and CPI plus 1% in the final year, as well as other benefits such as an increase in the housing allowance. The talks were based on the assumption that CPI would remain at last year’s mid-term budget policy statement estimation of 5.5%, the unions said.

But tempers flared when a meeting meant to finalise the agreement was postponed last week, just seven days before the previous deal will expire. A new agreement will now have to be backdated once it is concluded.

“We are very disappointed but there’s nothing much we can do because there has been movement in government leadership,” Cosatu’s joint mandating committee chairperson, Mike Shingange, said.

Basil Manuel, the chairperson of the Independent Labour Caucus (ILC), said: “The previous minister had given a particular mandate to her negotiators and we had started with that process, though we were not yet finished. “To have that change so late means we’re going to start negotiations again.”

The postponement also irked the Public Servants’ Association (PSA), which represents a majority of the government’s 2.7-million workers and which has threatened to register a dispute.

“We have written to the new minister where we informed her about our disgust about [the postponement]. We were very lenient about the change and thought, ‘Let’s hang on’, but the fact that the meeting has been postponed is not a good sign,” said Ivan Fredericks, the PSA’s general manager.

Dlodlo asked for a postponement because the “government’s mandating committee, which consists of the treasury and a number of departments, is still crunching the numbers”, Shingange said.

Fredericks said: “Faith [Muthambi] promised a lot of things. The question now is, will the new minister deliver?

“We cannot go lower than what the economy of the country currently is. We will have to make use of the remedies that are there to force their hand.

“We are going to declare the dispute. If nothing is going to happen on the fourth and fifth [of April], it will bring us to where we have to take action.” Shingange, who is also deputy president of the National Education, Health and Allied Workers’ Union, warned of the potential consequences of a lower offer.

“That will be an indication of negotiation in bad faith and we don’t think they would like to see the reaction of the workers.”

Manuel said ILC members were eager to get the new deal finalised but were cautious about rushing negotiations. The ILC represents unions affiliated to the National Council of Trade Unions.

“We understand that there has been a change in the leadership in government.

“We are happy to give time and we don’t expect it to be postponed any more because it puts us under pressure and the deal that will be concluded may not been sufficiently considered,” Manuel said.

Muthambi appeared to have agreed to change the structure of the housing allowance, which includes a spousal clause, worker representatives said this week.

The clause that Muthambi signalled she would scrap stipulates that, if a married couple both work for the state, only one of them is entitled to receive the monthly payment.

All the worker representatives said they expected Dlodlo to fulfil this promise. They have been further antagonised by the implementation of the VAT increase on April 1.

“VAT is going to go up by next week and workers have not got anything, so it hits them even deeper in their pockets,” Shingange said.

The chief economist of Econo-metrix, Azar Jammine, said current government estimates make provision for a CPI plus 2% increase, and Ramaphosa’s administration would be careful not to upset the workers before an election.

“It’s quite clear from the budget in February that the government is going to award a fairly generous pay offer to public servants, presumably to ward off the possibility of a strike,” Jammine said.

Public service and administration spokesperson Mava Scott said the minister as chief negotiator at the bargaining chamber was “unable/reluctant” to discuss the wage bill negotiations at this stage “for fear of jeopardising the process”.

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