Cape Town – The National Treasury has noted the outcome of wage negotiations at the 2023 Public Sector Coordinating Bargaining Council (PSCBC) where the majority of parties have agreed to a two-year agreement, which encompasses a 7.5% increase.
This will result in the current cash allowance being translated into a pensionable salary, plus an increase of 3.3% in 2023/2024, and a Consumer Price Index-linked increase in 2024/2025.
The employer’s final offer tabled on 17 March 2023 at the PSCBC entailed the following provisions:
– A two-year multi-term agreement for the financial year 2023/24 and 2024/25.
– Pensionable salary increases of 7.5% for employees on levels 1–12 packaged as follows:
a) Translation of the current non-pensionable cash gratuity at the value of 4.2% on the baseline.
b) A nominal increase of 3.3% across the board.
c) The pay progression of 1.5% for all qualifying public servants shall continue, as per the existing dispensation across all departments.
Implementation
The government said it had ensured that the latest public sector wage agreement was implemented through “significant trade-offs”.
The cost of the agreement, according to the Treasury, is estimated at R37.4 billion in 2023/2024, with carry-through effects also applicable for subsequent financial years.
“The 2023 Budget did not pre-empt the outcome of the wage negotiations.
“In this regard, the outcome of the wage bill negotiations was identified as one of the key risks to the fiscal outlook presented in the Budget. This risk has now materialised,” the Treasury said.
Meanwhile, the government said it remained committed to reducing the fiscal deficit to more sustainable levels and stabilising debt.
“Therefore, government will initiate processes to ensure that the latest wage agreement is implemented through significant trade-offs in the short-term and over the medium-term.”
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Compiled by Junaid Benjamin