E227M FOR COLA MAY TRIPLE

MBABANE – The E227 million budgeted for salary increments may just triple over to approach a billion Emalangeni, as workers push for a 9.5 per cent salary increment.

The 9.5 per cent cost-of-living adjustment (CoLA) tabled by public servants dwarfs the E227 million that government has set aside.
Simple arithmetic proved that the 9.5 per cent works out to E718 833 333.33.

At worst, the public servants’ demand will require government to part with just over E718 million, over and above what was budgeted for.
Public servants have already embarked on a series of meetings with the Government Negotiations Team (GNT) where the agenda is the CoLA as well as allowances which have been due, since 2017.

Minister of Finance Neal Rijkenberg said last Friday, after the budget speech, that government had allocated E227 million for CoLA. This was after three years of government’s failure to afford them a salary increment, while the inflation has seen increases of more than 10 per cent collectively.
Rijkenberg said the allocation set aside for CoLA was estimated to be the three per cent government had promised at the beginning of the financial year – 2020/21.

National Public Servants and Allied Workers Union (NAPSAWU) President Oscar Nkambule confirmed that workers were pushing for a 9.5 per cent increment as the least percentage they could accept from government.
Nkambule said the E227 million was minuscule given the 9.5 percent that workers were demanding.

Insulting

He said the workers found it insulting that government would set aside such a budget.
“What we were expecting them was to rather commit to a better percentage and, if the money is not there, they can negotiate the dates on when the money would eventually be given to the workers.”

Nkambule said the recruitment of security forces would consume a sizable chunk of the budget, further escalating the wage bill.
“The obvious result is that money has to be budgeted for salaries,” he said.

He said the workers had always rejected the 3 per cent ever since the negotiations started because it was not enough.

He said workers could not even say convincingly that the E227 million amounted to 3 per cent because they were still to analyse the figures.
Nkambule said the CoLA would have to be backdated to 2017 when the workers last received a salary increment, which will also bring down the percentage of the E227 million.

Currently, estimates of the wage bill are said to be E8.44 billion, which corresponds to 37 per cent of government’s expenditure. This figure, despite the advice of the International Monetary Fund (IMF), had been escalating over the years.

The introduction of the E277 million is expected to escalate the wage bill to E8.717 billion. To this amount, government also set aside E113 million for notching.
Information and Communications Officer in the Ministry of Public Service Hlobsile Vilakati, when asked if the E227 million budget would be sufficient, said it was still too early to say.

“We cannot commit ourselves at the moment regarding the sufficiency of the budget amount because it will all depend on the outcome of the ongoing negotiations between the Government Negotiations Team and the Public Sector Associations (PSAs),” she said.
Vilakati further said the issue was still on the agenda for 2019/20 negotiations though the date when the teams would return to the table had not yet been determined.

“But one can confirm that it is the next item on the agenda,” she said.
When announcing the increase in the wage bill, Rijkenberg said an unfortunate consequence of the cash flow challenge, largely a contribution of many factors, was that it had resulted in government not being able to grant CoLA for the past three years.

He said: “I would like to thank the Public Sector Associations (PSAs) and its members for being tolerant and understanding of these difficult times that we are trying to overcome. We have continued to provide and pay for notching that has taken place every year. However, this has only been a benefit to some civil servants. This notching has increased the national wage bill with an average of 1.5 per cent annually. This year we have budgeted E113 million for notching and E227 million for CoLA.”

Cautioned

While announcing this, the minister noted that the five most recent IMF and World Bank country reports had cautioned that Eswatini’s largest budgetary ‘outlier’ was on the expenditure side.

Furthermore, he said, the institutions had also noted that the single largest contributor to the fiscal deficit was the size of the wage bill.  This advice was also sent to government by the IMF’s executive directors through an Article IV consultation concluded on January 30, 2020.

The document said: “Specifically, they (directors) encouraged the authorities to contain public wage spending and administrative expenses, rationalise transfers to State-owned entities, prioritise capital projects, and broaden the tax base.”

Given this development, in essence, it means government has now, in 11 years, failed to do one thing; and one thing only – to minimise the wage bill.
The Appropriations Bill is still subject to scrutiny by Parliament before it is made an Act.

Meanwhile, the PSAs are currently spoiling for a protest action as they are conducting a balloting process to find out if there is a popular support for the strike for CoLA. This is after their previous bid to strike was annulled by the court.

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