Reining in wages is a reasonable way to address our debt problem
Logic and experience tell us that we can't spend or tax our way out of this
SA's public debt is R3.6-trillion and debt service costs are projected to be at R778bn in the next three years. Low tax revenue, largely due to weak economic growth, has led to an increase in government borrowing. Rising debt-service costs, the wage bill, and bailouts of state-owned entities have also worsened public debt.
In the midst of rising public debt there have been calls on the government to cut its expenditure to realise a zero fiscal balance or a budget surplus. On the other hand, there are also calls to increase government expenditure, including increasing the wage bill to stimulate economic growth...