PRETORIA- A South African minister on Tuesday called unions representing about 1.3 million state workers back to negotiations over pay increases, seeking to avert a strike that could shut down hospitals and schools.
But Lindiwe Sisulu, minister of public administration, also said any wage increase above the government’s current 6.5 percent offer would add to the debt of the national budget.
Wages for government employees are the largest sector of state spending, usually costing an amount equal to more than 40 percent of tax revenue. Talks over pay increases broke down last week, raising the threat of a strike.
“The state of our global economy, the reality of our own limited budget, our own credit rating and credibility make me hope and believe that labour and ourselves as government have no appetite for a dispute and worse a strike,” Sisulu told a news conference.
South Africa had originally budgeted for a 5 percent increase but was forced to increase its offer as inflation has inched up in the past months, hitting 6.1 percent in April.
Sisulu said the 6.5 percent offer would swell spending and cost the government about 10 billion rand more than had already been set aside.
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South Africa would have to dip into its reserves if unions rejected the offer, she said.
The two sides are not far apart, after unions dropped their latest demand of an 8 percent increase and appear willing to accept just over 7 percent – the inflation rate plus 1 percent, union sources said.
But since there are so many government employees, small increases add up quickly. A perk to provide civil servants with about $100 a month to help them with housing costs the country as much as it pays each year to run its court system.