Can municipalities afford a R4k salary increase?

The South African Municipal Workers Union (Samwu) has moved to demand a R4,000 salary hike following its recent collective bargaining conference.

But can municipalities, whose finances have been worsened by Covid-19 related events, including increased emergency expenditure, lockdown restrictions hurting local economies and plummeting  revenue, afford the increase?

Professor Patrick Bond from the University of the Western Cape School of Government says the union’s case for a raise following the harrowing economic conditions of 2020 was strong.

“While of course there are bureaucratic slouches, political deployees and straight-out corrupt elements working in every municipality on earth, the vast majority of our own workers are poorly-paid labourers who during Covid-19 risked their lives so the rubbish collection, water and sanitation, electricity, storm-water drainage and other vital functions of daily life could continue apace.”

Municipal workers had yet to reap any rewards for the risks they took to deliver services during a pandemic over the past year.

“The municipal above-inflation wage increase they are requesting is reasonable, and there is plenty of fiscal space, were the Treasury to borrow more, the Reserve Bank to support Treasury through quantitative easing (buying government bonds), and corporate taxes were raised instead of being cut, when so many big firms are declaring windfall profits.”

Also Read: Samwu calls on municipalities to pay July salary increases ‘with interest’

Municipalities make up 7,7% of the February 2021 medium-term expenditure framework spending and is set to rise by 2.2% annually over the next three years. With inflation, however, this was likely to be closer to 3% each year, Bond adds.

That means a net cut in national-to-municipal funding. Budget cut decisions made nationally would hit hardest amongst the most vulnerable he warned.

“Like so many aggrieved citizens, whether child support grant recipients, or students, or cultural workers, or the civil service generally, austerity is hitting the weakest the hardest. The Treasury’s hard line on spending is short-sighted, because when municipal workers get mad, as they have shown again and again and again in disruptive strikes, they get even.”

Samwu prepared a list of demands and resolutions prior to the commencement of salary and wage negotiations. Current agreements in both the South African Local Government (SALGBC) and the Amanzi Bargaining Council (ABC) come to an end in June this year.

In the 2021 Budget Review, Finance minister Tito Mboweni announced a planned reduction in government expenditure by as much as R264.9-billion over the next three years. This was would be achieved by freezing wages for South Africa’s 1.2 million public servants.

But according to the South African Local Government Association (SALGA), municipal workers’ are approaching the end of a three-year agreement and through the SALGBC and ABC.

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“Prior to this whole Covid-19 there as already an  agreement in place,’ explains SALGA spokesperson Sivuyile Mbambato.”The salary negotiations with concerned parties will be ventilated at an appropriate time through the collective bargaining council.”

Last year, municipal workers went on an unprotected strike in the Tshwane metro following a break-down in salary negotiations. This led to a halting of services and damage to property as workers took to the street in frustration.

Samwu also plans to demand single year agreement after workers decided they no longer want to be tied to multiyear agreements which ‘are not in their interest’ and failed to effect real socioeconomic change.

“The Conference further believes that single year agreements would be in the interest of labour stability in the sector given the fact that the future is uncertain,’ said the conference declaration penned by the union’s secretariat.

“We further send a strong warning to National Treasury which has made itself the enemy of workers to desist from interfering in collective bargaining, otherwise they will know the full might of municipal workers,” it concluded.

Simnikiweh@citizen.co.za 

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