Public Enterprises Minister Pravin Gordhan says the history of monopoly operators among many state-owned enterprises have resulted in higher staff costs.
Addressing the Federation of Unions of South Africa (Fedusa) bargaining conference, Gordhan said there was an urgent need to review the remuneration and benefits structures to be in line with respective industries.
He says SOEs will have to review their business model.
In the video below, Minister Gordhan says some cancelled SAA domestic routes will be reinstated soon:
“There are staffing impacts which we need to talk about and in some instances more qualified staff is required. In other instances staff costs are higher than they should be because some of them are monopolies and monopolies have been able to look after themselves,” adds Gordhan.
“There’s an urgent need to review the structure of remunerations and benefit so they are in line with what is expected for the categories of institutions that we are dealing with,” he explains.
Meanwhile, on Tuesday, Fedusa threatened to strike over government’s decision to backtrack on a three year agreement that would have given civil servants a seven percent wage increase from the beginning of next month.
However, in his budget speech, Finance Minister Tito Mboweni announced that the public sector wage bill will be cut by R160 billion over the next three years.
Labour federations Congress of South African Trade Unions (Cosatu) and SAFTU have already called the decision a declaration of war.
Mboweni said measures to contain the wage bill had already been tabled at the Public Sector Co-ordinating Bargaining Council. Economists have long argued that government should take a tougher line with unions given the severe fiscal constraints.
Recently, ratings agency Fitch said public sector wages account for around a third of consolidated government expenditure.
Issues of over staffing at Eskom:
Last month, another government SOE, Eskom, was offering voluntary exit packages to its senior managers.
The utility’s board has allocated a budget of R400 million for the retrenchment plan.
Eskom says the voluntary cash separation packages would be opened to managerial-level employees in non-core positions.
In the video below, Eskom spokesperson explains that voluntary retrenchment packages to managers will not be imposed:
SAA is overstaffed by at least 30%: DA
There is general consensus that South African Airways (SAA) is overstaffed by at least 30%, the DA said in a statement.
In the past, the party had suggested that there was no way that SAA can be rescued, if at all, without massive staff retrenchments.
Unions have on serval occasions tried to stop the business rescue practitioners (BRP) from taking any steps towards the termination of services of employees at national carrier.
In the video below, Head of Solidarity’s research institute Connie Mulder reacts to SAA court ruling:
-Additional reporting by SABC Digital News