A showdown between local government and unions is expected as they struggle to find common ground and avert a strike that could bring municipal services to a standstill. The two parties meet again in two weeks time after the first round of negotiations recently yielded no fruit.The unions Samwu and Imatu are demanding an across-the-board wage increase of 15%, or R4000, and a housing allowance of R1800 for all municipal employees.But municipalities are under considerable financial pressure following Treasury's shock decision to stop providing equitable share - an allowance for basic services, community services and administration - to more than 57 municipalities. Most of these municipalities depend on the allowance to cover salaries.The Treasury took the drastic action after municipalities failed to settle Eskom and water bills.The SA Local Government Association's offer - on behalf of 278 municipalities - of a 4.4% inflation-linked pay increase for the first year has been rejected by Samwu and Imatu.Salga spokesman Tahir Sema warned yesterday that the current economic environment did not allow for high wage increases."We are negotiating in a very tough and stringent financial environment."The minister of finance has indicated that even 1% over inflation for salary and wage increases will be unaffordable ... We went around and checked the municipalities across the country and many of them cannot even afford the initial offer we have put on the table," Sema said.But Samwu spokesman Papikie Mohale said the union would not back down on its demands...