PSA rejects state’s new 7% pay increase offer

The Public Servants Association (PSA) has rejected the government’s new 7% salary increase offer pertaining to the 2023/2024 financial year.

The union, which comprises 235 000 workers from Home Affairs, border posts and other roles, is pressing for a 10% increase, in the wake of South Africa’s rising cost of living.

“The PSA remains resolute on its mandated demand for a 10% increase. Government’s offer does not consider the escalating cost of living and does not meet the needs of public servants,” the union said in a statement on Wednesday.

The government’s revised offer is an improvement from the 4.7% increase it previously proposed last month, when salary negotiations commenced with public sector unions affiliated with the Federation of Unions of South Africa (Fedusa) at a special council meeting at the Public Service Co-ordinating Bargaining Council (PSCBC).

The PSA called on government to table an improved offer, saying that it cannot allow for more delays in the negotiations.

Its rejection of the state’s new offer is a double whammy for the government, which is also facing pressure from the National Education Health Workers’ Union (Nehawu), the Police and Prisons Civil Rights Union (Popcru) and others, with which it remains locked in a dispute on the 2022/2023 pay talks.

Nehawu took to the streets on 6 March disrupting key services such as those in the health sector, and continues to stage industrial action.

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The government is also trying to rein in spending and considers the country’s wage bill, which has breached R700 billion for the current financial year, unaffordable and as one of the key threats to its fiscal position.

When he tabled his budget for the 2023/2024 financial year, Finance Minister Enoch Godongwana said he expects compensation for workers in the employ of the public service to reach R701.2 billion, surpassing a level he once thought would be reached in 2025.

In the previous financial year, the government spent R690 billion on the wage bill, which included an additional R14.6 billion it spent to fund wage increases, following its unilateral implementation of a 3% increase in October last year.