DA will go toe-to-toe with Cosatu on our Fiscal Responsibility Bill

We note the statement from Cosatu this afternoon in opposition to the DA’s Fiscal Responsibility Bill, which will be debated in the Standing Committee on Finance in Parliament tomorrow.

We acknowledge Cosatu’s opposition and welcome the opportunity for robust debate on South Africa’s fiscal future, but we also need to correct the misinformation they are peddling today.

Cosatu is free to oppose the DA’s Fiscal Responsibility Bill. But they should do so on the basis of facts.

The fact is that the DA is the only party that has presented a proposal for cutting the public wage bill that would protect inflation related increases for nurses, teachers, police officers, social workers and other frontline service delivery staff, while focusing cuts on “millionaire manager” head office staff that do not deliver services directly. This remains South Africa’s most sensible, costed proposal on the public wage bill.

While the overall government vacancy rate stands at about 10%, most provincial education, health and social development departments currently have vacancy rates of over 15%. This is a clear indication that departments have chosen to protect the millionaire lifestyles of cadres in management positions over the hardworking teachers, nurses, doctors and police officers who deliver vital services to citizens.

The government currently spends close to R30 billion per year to fund the millionaire lifestyles of 29 000 managers in the public services. This includes R7.2 billion spent per year on middle managers in provincial governments, R6.1 billion on senior managers in provinces, R8.1 billion on middle managers in national government, and R8.3 billion on senior managers in national government. On average, each of the 9 774 senior managers in national and provincial government takes home R1.4 million per year, with the highest level managers being paid over R2 million per year.

The DA believes that public sector wage bill cuts should be focused on these 29 000 millionaire managers, as well as by freezing the wages of the 33.7% of public servants who are not covered by the Occupation Specific Dispensation (OSD). This category includes office managers, administrators and supervisors who spend most of their working hours in air-conditioned offices. In turn, this would enable the state to protect the wages of frontline workers by ensuring that the 66.3% of public servants who are covered by OSD receive CPI inflation-linked increases.

In total, our proposal would save R163 billion over the MTEF period, exceeding the target set by the finance minister by R2.9 billion and restoring South Africa to the path of fiscal sustainability.

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