LABOUR: Wage Deal Could Be Good
Recent Western Cape Business News
THE proposed three-year wage deal for municipal workers could bring an end to the annual strike season and should be welcomed even if the increases were above the inflation rate, says the Cape Chamber of Commerce and Industry.
“We cannot afford the yearly disruptions to services and the damage the strikes do to the reputation of the country so a three-year deal is a great improvement on the settlements of recent years,” said Michael Bagraim, President of the Chamber.
He said the deal provided more stability and it would enable municipalities to plan ahead with more confidence.
Bagraim said he hoped the settlement with public service workers would also be based on a three-year deal. “Many countries pursue five-year deals and that promotes stability and better planning. Single-year pay deals like we have seen in the recent past create a climate of uncertainty for both management and workers.”
He was concerned, however, about the size of the increases. “Any pay increases above the inflation rate can only be justified by an improvement in productivity and there is little evidence of that. Many municipalities are in financial trouble and most of the service delivery protests are aimed at them. In these circumstances it is difficult to understand how SA Local Government Association could have agreed to three successive years of above-inflation increases.”
Bagraim said the increases followed a series of similar annual increases and municipal workers were now better paid than their counterparts in the private sector. “We can’t go on like this. We have a growing public service and it is getting more expensive every year. Economic growth is slow and it is unrealistic to expect the depressed private sector to generate the rates and taxes to pay for it all.”
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