Government wants CCMA to end wage dispute

South Africa’s government asked mediators to urgently intervene to help end a wage dispute with public-servant labour unions before Finance Minister Enoch Godongwana presents his mid-term budget this week.

Department of Public Service and Administration Director-General Yoliswa Makhasi asked the Commission for Conciliation, Mediation and Arbitration to help negotiate an end to the impasse in a letter seen by Bloomberg.

The Public Servants Association, which says it represents more than 230,000 state workers, on Monday filed a notice of its intention to begin a strike in seven days over the government’s failure to agree to its wage demands.

“Reaching an amicable solution to the current impasse has become extremely urgent for us in order to manage the risk of public servants not receiving any salary increases for this financial year,” Makhasi said in the letter.

State employees this month rejected an offer by the government to increase their pay by 3% and continue a non-pensionable cash allowance of R1,000 a month. They’ve demanded 6.5% raises.

The remuneration of the state’s 1.3 million workers accounts for almost a third of total government expenditure, and keeping it in check is key to the National Treasury’s plans to rein in the budget deficit and bring runaway state debt under control.

Acting Public Service Minister Thulas Nxesi warned last week that he might impose the 3% wage increase unilaterally to help create fiscal certainty ahead of Godongwana’s budget statement on 26 October.

The medium-term budget policy statement makes adjustments to cater for additional funds for unforeseeable expenditures.

In the current case, the unforeseen spending is estimated at R14 billion to cater for the 3% salary adjustment, Makhasi said. That amount is in addition to the R20.5 billion budgeted for the 2022-23 financial year, she said.

Labour unions affiliated with the Congress of South African Trade Unions plan to hold a briefing later on Monday about the actions they’re considering in regard to the pay dispute.