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29 July 2011 at 10:08 - Posted by Anonymous

Public outstrips private pay


The tail is wagging the dog in terms of the public sector wage bill, which has nearly doubled from R177 billion in 2007 to R308bn in the current fiscal year, and pressure is building up to provide above-inflation increases for public servants this year as well, the Cape Chamber of Commerce has warned.

Chamber president Michael Bagraim said yesterday “the pendulum has swung completely” in the direction of better-paid jobs in the public service and parastatals and away from the private sector.

There are 1.3 million people in public sector jobs.

Bagraim attributed the massive growth in what the Budget Review calls “the compensation of employees” to the cosy partnership between the ANC, the trade unions and the SACP.

“This is the fruits that you (the governing party) reap from being in the tripartite alliance,” he said, noting that there was “no arms-length relationship” when the government was in the bargaining chamber over pay with its allies.

“The tail is wagging the dog with the government at the mercy of the trade union movement,” said Bagraim, who is also a labour lawyer.

Dawie Roodt, Efficient Group’s chief executive, has plotted the average monthly earnings in formal non-agricultural employment in the public versus the private sector. In 2000 salaries in the public and private sectors were more or less on a par – with state jobs slightly better paid.

The average pay was less than R4 000 a month. But by 2010 the average state worker earned R9 000 a month, while the average private sector worker earned just over R6 000.

But Tony Ehrenreich, Cosatu’s Western Cape leader, said economists and the chamber were working from a different value system to the workers.

“We are on the right track in undoing the apartheid labour practices in the public sector. If it weren’t for the wage curve normalisation (in the public sector), the levels of inequality would have been even greater than at the moment,” he said.

He said the salaries in the private sector were lower because the sector was “moving in the wrong direction” – there was greater casualisation of jobs, temporary work and undoing of service conditions.

That was why the strikes in the private sector had been “more bitter and acrimonious” because the apartheid wage gap was being maintained or even increased. He noted that public sector unions had not settled as the government was offering a 7 percent increase.

Meanwhile, Endemol Productions executive chairman Moeletsi Mbeki, the brother of former president Thabo Mbeki, said South Africa could learn from the example of China, a communist country.

China, he said, did not allow the highest-paid staff member at a parastatal to earn more than 11 times the lowest paid worker.

Mbeki said in South Africa someone who ran a company – or a parastatal – of 10 000 workers would probably ask anything upwards from R10 million a year “while workers earn about R4 000 a month”.

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