South Africa's government has asked for a court hearing over a wage dispute with public sector trade unions to be postponed from Wednesday until after February 1, a letter seen by Reuters showed, but unions are opposed to the delay.

The unions took the government to court after officials said the state could not afford to pay salary increases that were due to come into force in April 2020 as part of a three-year wage deal struck in 2018.

Economists view the dispute as critical because of the dire state of public finances, and it has important political ramifications as the governing African National Congress (ANC) is in an alliance with some of the unions involved in the dispute.

"I am instructed by the Department of Public Service and Administration to suggest that the parties consent to postpone the hearing of the wage dispute application before the Labour Appeal Court (LAC), from 2 December to after 1 February 2021," the letter from the state attorney's office to the unions' lawyers said.

"Settlement would be preferable where there is a reasonable chance that the current dispute will go beyond the LAC and will only be finally determined much later," the letter continued.

Negotiators for the Public Servants Association and unions affiliated with the Congress of South African Trade Unions, which is aligned with the ANC, told Reuters they were opposed to the hearing being postponed and would see the government in court on Wednesday.