The National Education, Health and Allied Workers' Union [NEHAWU] notes the presentation to Parliament today of the last budget of the sixth administration at the Cape Town City Hall by Finance Minister, Enoch Godongwana.
It may be that "the size and quality of the national pie is what informs, and ultimately determines, the realisation of our political imperative of redistribution", according to the tired Neoliberal mantra espoused by the Minister. But, on the contrary, as NEHAWU we assert the incontrovertible practical experiences in numerous countries around the world showing that the redistribution of resources actually expands the size and quality of the national pie.
In October 2020, the Treasury laid out "a five-year fiscal consolidation pathway that promotes economic growth while bringing debt under control." Accordingly, this was meant to contain the stock of debt at around R5.5 trillion in 2023/24 (from R4 trillion) and the devastating impact of the COVID-19 pandemic was already anticipated in terms of growth and revenue contractions projections for 2021.
This five-year "fiscal consolidation pathway", properly known as austerity, marked a departure from the 2019 electoral commitment and mandate given to the sixth administration, which stated that: "Our macroeconomic framework, including fiscal and monetary policies, will be aligned to support the commitments made in this Manifesto. The ANC believes that the South African Reserve Bank must pursue a flexible monetary policy regime, aligned with the objectives of the second phase of transition. Without sacrificing price stability, monetary policy must take into account other objectives such as employment creation and economic growth".
It is against this background that as NEHAWU, we expected that the 2024 Budget Speech, in particular the 2024 Budget Review would include an assessment as to whether the austerity measures unilaterally imposed have actually worked - given the devastating impact that these measures have had on the livelihoods of the public servants and the working class generally who depend on public services. This devastating impact of austerity measures is highlighted by the fact that unemployment is still on the rise, keeping at least two in five of the labour force unemployed, in terms of the Statistics South Africa's Quarterly Labour Force Survey for the 2023 Fourth Quarter.
A forecast of 0.8% in economic growth rate in 2024 simply denotes stagnation given the multiple crises facing our society and this has been the case throughout this period of the implementation of the "fiscal consolidation pathway". It is therefore disappointing that after all these sacrifices imposed on the public servants, which eroded the value of pay and pension, as well as the already minuscule social wage offered to the working class - at the time of escalating costs of living and deepening crisis of reproduction - that the debt stock would still continue to rise up to R6.29 trillion in 2026/27 and the country is apparently still under the cloud of "a high sovereign credit risk."
In addition to the objective of building the capability of the state in terms of the Medium Term Strategic Framework (2019-24), the sixth administration also committed itself to meeting the people's needs through "interventionist, developmental and participatory public administration". Instead, the public service remained incapacitated with approximately 12% vacancy rate, kept at around 1.2 million despite the growth of the population. Even, in terms of the outdated staff establishment set up in the context of the public service reforms driven by the imperatives of GEAR, when the population was approximately 20 million less, the current vacancy rate has been devastating in terms of work-overload experienced by public servants, of whom about 65% are in the frontlines of service delivery. This is more so when taking into account of the fact that this vacancy rate includes approximately 40 000 vacancies in healthcare and over 70 000 in education. This underscores the fact that austerity has been debilitating in terms of the capacity of the public service on personnel numbers but also regarding the capability of the public service given the existing gab in the necessary professional skills or expertise in healthcare and education.
Once again this underlines government's serial undermining of collective bargaining, in this case, regarding the Resolution 1 of 2007 of the Public Service Coordinating Bargaining Council (PSCBC) which called for the expeditious filling of the funded vacant posts. For us as NEHAWU, the issue raised by the Minister in the speech regarding the "R11.6 billion to address the 2023 wage agreement" is a moot point at this stage in the wake of the recent historic Labour Court order enforcing the NEHAWU's 2023 public service strike Settlement Agreement with government, on which the employer disgracefully reneged. We hope government would honour the court's injunction around the aspect of augmentation in the Settlement Agreement.
Nonetheless, NEHAWU welcomes the fact that in the overall government spending would be positive over the medium-term, notwithstanding the potential effects of inflation, including the fact that:
· R251.3 billion has been added over the next three financial years to ensure that the salaries of teachers, doctors, nurses, police and other public servants are funded.
· An amount of R7.4 billion is set aside in 2024/25 for the presidential employment initiative.
· Allocations to healthcare would grow by about 3.4% over the medium term.
· There shall be no increase in medical tax credit provided, which we believe is discriminatory and therefore unconstitutional as it benefits only a minority of the population whilst excluding about 84% of the population who are not members of the medical aid schemes. Hence, in this regard, we also welcome an allocation of R1.4 billion for the NHI grant over the medium-term to set up preparatory systems which were supposed to have been funded by the prevaricating Treasury throughout the tenure of the six administration.
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However, we call for the expeditious filling of all the funded vacancies in the public service, including in public hospitals and clinics, to ensure graduate doctors and nurses are hired and to honour the commitment of absorbing over 50 000 community healthcare workers into the public health system and double this number over the next five years as per the ANC's 2019 Election Manifesto.
We believe that a -0.1% allocation to the National Student Financial Aid Scheme (NSFAS) represents a potentially catastrophic reversal of the progress that has been made in the recent past given the fact university enrolment is currently at 1.1 million and it is expected to increase to 1.2 million by 2027. Already thousands of matriculants are unable to find placement in universities, TVET or CET colleges and many are unable to find work once they complete their tertiary education qualification. We note allocations over the medium-term in Higher Education and Training, indicating an increase at an average annual rate of 4.8 per cent, from R130.5 billion in 2023/24 to R150.2 billion in 2026/27. However, a 3.7% in university subsidies only means an impending state of instability in the institutions over the medium-term as the management are expected to implement cost-containment in terms of the salaries of the staff.
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