South Africa: Nehawu Proposals to National Treasury On the Mtbps

30 October 2023
Congress of South African Trade Unions (Johannesburg)
press release

The National Education, Health and Allied Workers' Union [NEHAWU] cannot pre-empt the contents of the Medium-Term Budget Policy Statement (MTBPS) to be tabled on the 01st November 2023, however all indications point to a Neo-Liberal austerity budget fixated with draconian cuts across the board.

South Africa faces a worsening triple crisis of unemployment, inequality and poverty which has metastasised into a crisis of social reproduction. Life for workers, the unemployed and the poor has become impossible to survive, with 42.1% of South Africans unemployed and 60.7% of South African youth not being able to find work.

National Treasury will on the 01st November 2023, table a MTBPS steeped in euphemisms for austerity, such as "containing consolidated compensation costs". These cuts are directly targeting the public service workers and broader working-class. The cost containment and fiscal consolidatory measures will have a particular impact on the capacity of the state to deliver service in health, education, policing and other social services to our people, thereby hindering the quest building of a capable and developmental state that intervenes to societal needs.

As NEHAWU, we will continue to stand up against the public service wage bill austerity, and prevent the National Treasury from oppressing the public service workers; if the unjustifiable government's action to downsize the wage bill is left unchallenged, the public service will suffer injustice. We need to reimagine and reinvent a future with sustained increases in investment in the public service. We are ready to protest and put pressure on government whenever austerity expansions emerges.

As NEHAWU, we make the following key proposals to the National Treasury in order to reduce the austerity measures. The National Treasury needs to:

· Reverse or reinstate the 1% Cooperate Income Tax cut, which has cost the fiscus to forfeit about R13 billion in 2022/23 and R12 billion in the current financial year.

· Reverse the increase in the tax expenditure subsidies for member of medical aid schemes, who are only less than 16% of the population, whilst the rest of the population is excluded from this cushion.

· Ensure that there is no reduction in personnel and overall budgets of departments such as health, basic education, post-school education and social development.

· Reduce by half the government ministerial advisors. Half of the 27 ministers have even broken the guidelines in appointing more beyond the limit.

· Develop a criteria to reduce the cabinet, especially focusing on reducing the number of deputy ministers. For example, in portfolios that have concurrent powers were implementation is by provinces and the national is merely a policy custodian.

· Abolish the tickets for family members in the ministerial handbook.

· Undertake a review to scrutinise the "goods and services" spending. This is a channel of corruption, fruitless and wasteful expenditure. It requires a deeper examination to eliminate unnecessary spending by departments. The 2019 report of the PSC shows that in this spending item includes many of the high paying jobs that are now contracted often to the same people who used to occupy them.

· Review the executive pay and perks of managers of all the entities (SOES) that are in financial distress and wage freezes must be imposed.

· Engage in social dialogue and collective bargaining with trade unions to set fair and gender-equal public service wages and commit to honour agreements. This will lead towards long-term economic planning that prioritises people's wellbeing and not just GDP growth.

· Increase transparency and accountability in all national economic discussions, whether with the IMF or any other global actor. Publish all data and sources and expand parliamentary and public involvement.

Lastly, we will continue to be at the forefront of defending the gains of workers and will not be deterred by neoliberal apologist who are fixated on dismantling what is left of our developmental state. In this regard, we will work on building and strengthening the broad-based movements that serve to condemn the austerity and promote alternatives to neoliberalism.

END

Read the original article on COSATU.

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