BUDGET 2024 | R251bn to cover public servants' wage increases

The government will spend R251bn in the coming financial year to cover public-sector wage increases.

Tabling his 2024/2025 budget in parliament, finance minister Enoch Godongwana said the R251.3bn will be used to fund salaries of civil servants such as teachers, health workers and the police.

“Spending additions, mainly of the carry-through costs of the 2023/2024 wage increase and wage bill pressures in labour intensive departments, including basic education, health and police,” said Godongwana in budget documents tabled in parliament.

The government and public-sector unions have agreed to a 7.5% wage increase for the current fiscal year, ending in March 2024. The agreements include the payment of a cash gratuity of 4.2% of a monthly salary.

Godongwana did not allocate additional money to fund wage increases in other departments, saying they would have to find money through their allocated departmental budgets.

“Most other departments are expected to absorb the wage increase within their baseline. This will include managing headcounts, such as by implementing controls on payroll systems to ensure departments operate within their budgets.

“Government is exploring other measures, which will be tabled for discussion in the public service co-ordinating bargaining council as part of a broader discussion on containing wage bill growth.”

On the whole, the salaries of public service workers were projected to rise to just more than R822bn by 2027, from R721bn this year.

In the basic education sector alone the “carry through costs” will come in at R25.7bn in the upcoming financial year.

Godongwana has allocated R848bn to the health department for the next three years to allow it to hire more health workers and improve public health infrastructure, among others. This comes against the backdrop of a recent strike by unemployed doctors and other medical personnel.

“Health is allocated a total of R848bn over the MTEF [medium-term economic framework]. These allocations include R11.6bn to address the 2023 wage agreement, R27bn for infrastructure and R1.4bn for the NHI grant over the same period,” Godongwana told MPs.

“The allocation for the NHI is a demonstration of the government’s commitment to this policy.

“There remain a range of system-strengthening activities that are key enablers of an improved public healthcare system that must be undertaken.”

The NHI Bill has been passed by parliament’s two houses, the National Assembly and the National Council of Provinces and has been sent to President Cyril Ramaphosa for assenting. But the president is yet to sign it into law, as business lobby groups and other interested parties have petitioned him not to do so, arguing the bill is unconstitutional in its current form.

With the Electoral Commission (IEC) due to run national and provincial elections on May 29, Godongwana has allocated R2.9bn to the IEC “to ensure the effective discharge of its duties during elections and its other responsibilities beyond polls”.

The police and the defence force will get an additional R350m to support the elections.

There was something in it for the political parties, too: “A further R200m will be allocated for political party funding as political parties prepare for the general elections.”

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