Amid a nationwide lockdown in which salaries are cut and jobs are lost as companies countrywide close, municipalities too should make sacrifices in terms of what their employees earn.
This is the plight of Outa (Organisation Undoing Tax Abuse), a registered non-profit Civil Action Organisation, who has called on Cooperative Governance Minister Nkosazana Dlamini-Zuma (CoGTA) Minister to place a moratorium on municipal salary increases.
Councils across the country are currently tabling budgets which include increases in salaries on 1 July, the beginning of the municipal financial year, despite the countrywide economic crisis. National Treasury, in a recent circular, reminded municipalities of the 2020/21 mid-term budget review, also proposing a proposed wage bill reduction for the public service.
The circular reads as follows: “Similar to national and provincial government, municipalities must ensure that compensation demands are balanced with the broader needs of society.”
Outa CEO Wayne Duvenage said businesses are closing down across South Africa almost daily and millions of citizens will lose their jobs or have their salaries cut, due to the unfolding economic difficulties brought on for many by the lockdown regulations.
Duvenhage said that even before the virus arrived in March 2020, most municipalities were defunct and in financial distress as a result of mismanagement and poor leadership.
He said some municipalities asked proposed salary increases of up to 11%.
To date, Duvenhage has not received a formal response from the minister and he again asked her to consider Outa’s request that an urgent moratorium be placed from her office on all salary increases (staff, management and contractors), including adjustments to other remuneration allowances, benefits and bonuses, for the foreseeable future.
Residents, businesses and communities are the biggest stakeholders in municipalities, and are the ones who have to carry these rising costs, he said. “Municipal salaries and the cost of contractors to whom the municipalities outsource much of the municipal work, have increased above inflation over the past decade.
“In the real world of businesses and families, if you don’t have the money to pay salaries, let alone salary increases, you simply can’t. What amazes us is that the authorities within the public service continue to operate as if there is no economic crisis out there,” he concluded.