Taking inflation at 5%, this points to an increase in real disposable income and corresponds with 20% increase in personal income tax collected in December 2014, BankservAfrica says.
“This also means that after taking inflation into account, take-home pay rose approximately 0.6% over the last year,” BankservAfrica’s head of fraud and data analytics Dr Caroline Belrose said.
But with Consumer Price Inflation (CPI) data at 4.4%, Economists.co.za’s chief economist Mike Schüssler said the real increase in income was even more than initially forecasted, at 1.2%.
“This shows that people in South Africa are getting richer. Although these numbers only account for people paid through payroll systems it still captures a significant portion of the working population, barring perhaps some of the people who work in construction and waitrons, who are sometimes paid by cheque.”
And the number of people earning less than R4 000 a month declined 3.1% in December. Counting from January 2013, the drop was more substantial at 12.8%.
Schüssler said this showed the economy would continue to grow, with retail sales pushing GDP. And, with fuel prices having come down in the past few months, spending data was set to improve.
“Of course there are other factors to consider such as load shedding directly hindering production and retail sales, so the increase in GDP may be negligible. It is also important to bear in mind that our calculations only factor in the money paid into bank accounts, which may or may not have included deductions like medical aid,” said Schüssler.
BankservAfrica’s Private Pension Index (BPPI), also released on Wednesday, revealed a 9.6% increase, year-on-year, to R5 735 per month. The real increase is estimated at 4.5%, although this is also likely to be higher given the lower-than-expected CPI data.
Said Schüssler: “It indicates SA’s average pensioner is keeping up with inflation. This can be attributed to good investment performance by South African retirement funds from increasing assets such as equities and commercial property.”
Walking the breadline
BankservAfrica did state, however, that the number of private pension payments on their payment system had decreased from 641 148 in January 2014 to 620 650 in January 2015, while the BPPI also showed 47% of private pensioners still get a pension of less than R4 000, up from 43.2% in January 2014. The number of private pensioners receiving more than
R10 000 was 15.8% of the total in January 2015 – nearly 5% up from January 2013.