#BUDGET2020: Mboweni’s Decision To Slash Public Sector Wage Bill By R160bn Angers Trade Unions

Thalia Holmes

Trade unions have reacted with anger to Finance Minister Tito Mboweni 2020 budget speech announcement that the public sector wage bill will be cut by R160-billion over the medium term.

“Public-service compensation has grown by about 40% in real terms over the past 12 years, and remuneration growth is increasingly out of line with the rest of the economy,” the National Treasury said in the 2020 budget detail, in explanation of its decision.

“The wage bill remains the largest component of spending by economic classification.”

If the recommendations are implemented, wage bill reductions will amount to R37.8 billion in 2020/21, R54.9 billion in 2021/22 and R67.5 billion in 2022/23.

In his speech, Mboweni asserted: “organised labour understands where we are. They have made constructive proposals on a range of issues.”

But the Congress of South African Trade Unions, the country’s large trade union federation, indicated a contrary sentiment.