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NEHAWU on the 2021 Budget Speech

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NEHAWU on the 2021 Budget Speech

25th February 2021

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The National Education, Health and Allied Workers’ Union (NEHAWU) notes the tabling of the 2021 Appropriation Bill, 2021 Special Appropriation Bill, 2021 Division of Revenue Bill, Budget Review, and the Estimates of National Expenditure by the Minister of Finance, Tito Mboweni, in Parliament today. Once again, NEHAWU reiterates its rejection of government’s Neoliberal Economic Reconstruction and Recovery Plan (ERRP) and its underpinning fiscal policy.

The committed R791.2 billion for infrastructure is little more than borrowed money for rents that are going to be given to private businesses, since the “user-pay” principle would be imposed on the citizens. Thus, members of the public, the so-called users, are ultimately going to pay for such infrastructure projects in addition to taxes collected and misallocated into the blended-finance Infrastructure Fund. The spectacular failure and public rejection of the Gauteng e-tolls is but a practical example of the folly of such new-fangled public-private-partnership projects. We are opposed to the current short cuts that are being employed such as what is happening at ESKOM in terms of the unbundling and the privatisation of that family silver.

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However, we welcome the extension of unemployment insurance benefits through the Unemployment Insurance Fund (UIF) for another three months to April 2021 as well as the Special COVID-19 Social Relief of Distress Grant. NEHAWU calls for the urgent implementation of the Basic Income Grant as part of a comprehensive social security system. 

Amidst the deepening inequalities, poverty and rising unemployment, it is out of nothing but Neoliberal dogmatic madness that the Treasury announces that “corporate income tax rate will be lowered to 27%”, whilst at the same time it tables expenditure cuts in health and education by 5, 1% and 5, 9% from 2020/21 to 2023/24, respectively. Not to mention, the 12, 1% cut in policing over the same period, amidst high-crime rate and rampant gender-based violence. It is therefore disgraceful that Minister Mboweni brazenly lies in Parliament that this is “this is not an austerity budget”.

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We note that in the Budget Review tabled in Parliament, the Treasury celebrates the success of its attack on collective bargaining and proudly states that “government did not implement public service salary increases for 2020/21” and that “performance  bonuses are already being phased out”. Indeed, embolden by the misguided ruling of the Labour Appeal Court of South Africa, the Treasury confirms that it is now unilaterally proceeding with the R160.2 billion cut for 2020/21 to 2022/23 as announced during the 2020 Budget and the additional cut of R143.2 billion for 2021/22 to 2023/24 as announced during the 2020 Medium Term Budget Policy Statement. NEHAWU further notes that government is hell-bent on escalating attacks on collective bargaining and rolling-back of workers’ gains as it is declares in the Budget Review that over the coming round of collective bargaining in the public service, it would seek to:

  • Impose a wage freeze, by “doing away with annual cost-of-living adjustment in the public service up until 2023/24”, including job cuts through “measures to reduce headcounts”, early retirement and natural attrition.  
  • Freezing or abolishing of non‐critical posts. 
  • Harmonising allowances and benefits, reconsidering pay-progression rules and reviewing occupation‐specific dispensations. 
  • Amending or abolishing some allowances and benefits.  

NEHAWU reiterates that it considers these attacks on collective bargaining, including the employers’ unilateral determination of the budget envelope for compensation of public servants through Parliament in order to predetermine the bona fide collective bargaining process, as a declaration of war. We are currently consolidating the demands of our members from the lower structures of the union, as well as working with other COSATU public sector unions and the Independent Labour Caucus (ILC). We refute the claims by the Minister that there has been talks between unions and the Department of Public Service and Administration (DPSA) on the next round of negotiations for the 2021/2022 bargaining cycle. As a matter of fact, the first scheduled council meeting will be in the next coming weeks at the PSCBC.

So it was utter lies that talks have been taking place with the DPSA. However, it must be noted that the matter of Resolution 1 of 2018 especially clause 3.3 which speaks to salary increase for public servants is still to be determined by the Constitutional Court. On the 22nd February 2021 we received the responding affidavits from both the DPSA and the National Treasury. In their answering papers they are still refusing to implement the last leg of the 2018 wage agreement and they still persist that the agreement is null and void. In this regard, we condemn the intention by the Minister to create a false impression that things are rosy between government and trade unions.

It is delusional to assume that the current restrictive conditions under the Disaster Management Act shall remain permanent and therefore, there shall be no resistance and fight-back from the public service workers to such draconian attacks on their livelihoods and conditions of service. The Treasury’s obsession with one dull instrument of debt management, that is compensation reductions and freezes, demonstrate that it is now high time that Minister Mboweni must be removed from cabinet or the ANC will have to deal with the wrath of workers and the poor due to the incompetent Minister Mboweni. Furthermore, the national union has noticed the deafening silence of President Cyril Ramaphosa on the frontal attack on workers by Minister Mboweni.

We view his silence as very problematic and unacceptable. Moreover, we are starting to believe that Minister Mboweni has both the support and backing of the President. We also reject with contempt the denial by both the President and Minister Mchunu that there is no attack on collective bargain, however, it is all there for all to see that the government has been going all out to reverse the gains of workers yet in public they deny that they are leading an attack on collective bargaining. In this regard, we support the decision of the COSATU Central Executive Committee (CEC) to report the South African government to the International Labour Organisation (ILO) for attacking collective bargaining. We want to send a clear message to the President that we are considering waging a relentless war against him if he continues to choose Minister Mboweni over workers.

Indeed, we reiterate that there are political consequences that the ANC government definitely shall have to pay for such draconian measures against the low-income ranks of the public service. This an insult to the hard-working frontline workers in the face of the COVID-19 epidemic and the rest of the public service workers in the coalface of service delivery, especially when the overall wage bill would still grow by 2.1% this year and by 1.2% over the medium-term as a result of the fat-cat compensation packages of elites in the government echelons, including the Cabinet, MECs, Judges, Parliamentarians, Traditional Leaders, Agencies and Government Components. NEHAWU rejects out of hand, government’s persistent lie that the current levels of public-debt and budget-deficit are results of the compensation of public servants.

The ANC government shall not fool the public servants, as together with the rest of the public, they know that the manufactured fiscal and debt crises are the result of years of alarming spates of fruitless and wasteful expenditures, out of control corruption and some of the socially irrational infrastructure projects. This is underscored by the fact that over the medium-term, once again the Treasury is set to borrow about R188,4 (between 2020/21 and 2023/24) for the bottom-less pit of State‐owned Companies that are managed by incompetent and corrupt executives and boards as illustrated by the Zondo Commission. The fact that year after year the AGSA has found such scandalously poor financial management and compliance assurance in government departments and entities, including in the Treasury itself, is of no concern to Minister Mboweni.

Indeed, the fact that Treasury is still failing to workout measures to remedy this situation reflects badly on its “resolute” commitment to “prudence”. And the fact that the Treasury does not even bother to account on how the borrowed R303,8 billion (between 2017 and 2020) as bail-out money to the SOEs was used, which includes the lavish compensation largesse for managers and boards, speaks volumes about its class-biased austerity agenda. It is also not surprising to us that there is silence on the part of Minister Mboweni when it comes to the corruption channels such as the outsourcing contracts (SLAs) in government and state entities that are for ever escalating year after year, as also scandalously highlighted in the proceedings of the Zondo Commission.

Therefore, we reject this elite propaganda that “over the past decade, government spending excluding interest on debt has grown sharply in real terms, primarily because of increases in public service compensation”. It is disingenuous and an anti-worker propaganda and as NEHAWU, we are determined to take the offensive to the government in defence of collective bargaining, rights of workers and livelihoods of the broader working class.  We call upon all progressive forces and the trade union movement to rally together and be united around a radical common platform against neoliberalism, austerity, attacks hard on hard-worn gains of workers and the poor.

Lastly, we call on the ANC led government to accelerate the implementation of the National Health Insurance, State Owned Pharmaceutical Company and a comprehensive social security program, through a progressive macroeconomic program.

 

Issued by NEHAWU Secretariat

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