Home | News | GOVT’S 3% COLA OFFER: PSUS WANT 8.7%

GOVT’S 3% COLA OFFER: PSUS WANT 8.7%

08/08/2023 16:02:00 Stanley Khumalo

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MANZINI – As government tabled three per cent as the cost-of-living adjustment (CoLA), it has been confirmed that civil servants, through their unions, are seeking 8.7 per cent.

According to sources, civil servants through their unions under the banner of Public Sector Unions (PSUs) of Swaziland shall tomorrow table their position paper, wherein they seek 8.7 per cent. The PSUs, who are the National Public Service and Allied Workers Union (NAPSAWU), Swaziland Democratic Nurses Union (SWADNU), Swaziland National Association of Government Accounting Personnel (SNAGAP) and Swaziland National Association of Teachers (SNAT), represent about 21 535 public service workers, based on their four unions’ membership updates, who are a fraction of the 42 686 civil servants, according to the Establishment Register for the financial year 2022/23. It is worth noting that not all civil servants are eligible to be part of unions as there are those classified as un-unionisable workers in the civil service. On behalf of their members, the quartet is said to be seeking the aforementioned percentage as it accommodates the inflation rate of the past year, which was 4.8 per cent.

Increase

According to the International Monetary Fund (IMF), inflation is the rate of increase in prices over a given period of time. It is said to be typically a broad measure, such as the overall increase in prices or the increase in the cost of living in a country. The Governor of the Central Bank of Eswatini (CBE), Dr Phil Mnisi, recently announced that Eswatini’s gross domestic product (GDP) grew by a slower 1.1 per cent year-on-year (seasonally adjusted) in the first quarter of 2023, down from a revised growth of 6.7 per cent in the fourth quarter of 2022.
On the other hand, he said the country’s headline consumer inflation declined to 5.3 per cent in June 2023, from six per cent in May 2023. “The bank reviewed down its inflation forecasts to 5.6 per cent (from 5.7 per cent forecasted in May) for 2023 while the forecast for 2024 was revised up to 5.4 per cent (from 5.3 per cent). The inflation forecast for 2025 was unchanged at 5.13 per cent. Risks to the inflation outlook include supply chain disruption due to the Russia-Ukraine, oil prices uncertainty and high food prices,” Mnisi said.

Meanwhile, the sources said the unions were seeking the addition of the inflation percentage, as it was what their salaries were corroded with. They said they were anticipating an increment in the cost of living given projections that there could be a drought in the upcoming months. This, they said, would further hike the prices of food as there would be limited supply of agricultural products. On the other hand, in addition to the 2022 inflation rate of 4.8 per cent, the sources said the civil servants were looking to benefit from the GDP, which was recorded at 3.9 per cent.

The sources said: “Civil servants, as people behind the improvement of the economy through service delivery, want to benefit from their input as well. It is the services that they render which make the economy blossom in addition to other factors.” The sources claimed that the 8.7 per cent would be the basis of their negotiations, as the basic cost of commodities was increasing monthly, due to geo-politics. It is a fact that since the war between Ukraine and Russia escalated in February 2022, prices of food commodities like cereal, and also fuel, hiked extensively.

Presented

Meanwhile, as the PSUs are said to be seeking 8.7 per cent on behalf of civil servants, government last week presented a three per cent offer. This was during the joint negotiation forum (JNF), wherein the Government Negotiating Team (GNT) negotiates with the PSUs on issues affecting civil servants. The Principal Secretary in the Ministry of Public Service, Sipho Tsabedze, confirmed that the GNT and the PSUs met in the JNF last week. Tsabedze requested not to divulge the contents of the negotiations, as he said they were still ongoing. He said they were yet to receive the position paper of the unions. On the other hand, SNAT Secretary General Lot Vilakati said the PSUs would be presenting their position paper to the GNT in the next JNF sitting.

It is worth noting that the Minister of Finance, Neal Rijkenberg, in his budget speech on February 24, 2023, said: “We have budgeted for three per cent cost-of-living adjustment but fully understanding that the salary review should take place and could affect this percentage.” In fact, his assertion was subsequent to a highlight of means government had employed to deal with the wage bill, which had a chunk of the national budget used to deal with it. He said since 2018, government implemented a hiring freeze, which had resulted in less than one per cent increase per annum in the wage bill. Rijkenberg said the wage bill had been reduced as a percentage to budget from 41 per cent in 2017 to a more sustainable 35 per cent currently.
In the same breath, he said government provisioned E900 million to recruit personnel in this financial year, which was equivalent to an 11 per cent increase in the wage bill.

Economist: Unions’ demand not feasible

MANZINI – The 8.7 per cent demand by unions is not feasible, says an economist.

Thembinkosi Dube said inasmuch as civil servants needed to be cushioned on their cost of living, he did not see government affording the 8.7 per cent. Dube said this could be impossible for government as the country’s economy was still ailing. He said: “At the moment, government is struggling to fulfill certain obligations. These include the shortage of medication in public health facilities and also paying all suppliers.” Worth noting is that the Minister of Finance, Neal Rijkenberg, last month announced that government had paid about E2.8 billion in arrears to suppliers.

Challenges

As this was paid, this publication reported that there were still challenges with the Phalala Fund; a government account used to pay for the citizenry in neighbouring countries for specialised treatment which is not available in the kingdom. Meanwhile, Dube insisted that the situation was not favourable and said his anticipation was that the employer and the civil servants would reach a compromise. He explained that the growth of the gross domestic product (GDP) did not translate to money accumulated by the State, as there were private businesses which were contributors and also behind the growth. “At this moment, it would be catastrophic (to increase CoLA with 8.7 per cent),” he emphasised. The economist opined that the pair should meet halfway in their negotiations.