Some parties in Parliament have expressed reservations about a call by Finance Minister Tito Mboweni for elected public representatives to consider salary cuts due to the prevailing economic situation.
Mboweni made the call during the debate on the Adjustments Appropriation Bill in the National Council of Provinces (NCOP) last week.
He said the country’s economy is heading for even tougher times due to the COVID-19 pandemic.
The government has borrowed money from the BRICS bank, International Monetary Fund as well as the African Development Bank to cater to the country’s expenditure needs and it intends to approach the World Bank for more money.
In the video below, the IMF board agrees to loan SA money:
Economy expected to contract by 7 to 7.5%
Mboweni has indicated that the economy is expected to contract by 7 to 7.5% and that the revenue collection will shrink significantly.
He has suggested that Members of Parliament should also take a salary cut.
“If we were to be frank to ourselves, all of us, we are in a period where even our own incomes are shrinking and we should be considering reducing our salaries because of the nature of the situation. The GDP is going to shrink. It’s going to be less than before the COVID-19.”
The salaries of MPs are determined by the Independent Commission on the Remuneration of Public Office Bearers. The Speaker of the National Assembly and the Chairperson of the National Council of Provinces earn about R2.8 million annually, Chairpersons of Committees earn R1.4 million and all other MPs earn between R1.6 and R1.1 million per year.
Leader of the Freedom Front Plus, Pieter Groenewald and African Christian Democratic Party (ACDP) Chief Whip, Steve Swart, say cutting MPs salaries will not fix the problem.
“We won’t take a cut in salary just for that money to be used again in corrupt ways. Yes, if they say no increase, we will be quite fine with that. But the minister should be looking inside his party first to recover that money from them,” says Groenewald.
Swart says, “We, as MPs, are already contributing to feeding schemes. It is a dire financial position not caused by COVID-19, just made worse by it. The economy should be opened; due health protocols must be in place. It will stimulate growth and jobs and address unaffordable debt. Other means to reduce expenditure should be looked into to reduce the size of the cabinet. Salary increase for two million civil servants is unaffordable and thirdly, looting of COVID-19 funds … it’s disgraceful.”
MPs react to salary cut suggestion:
Inkatha Freedom Party Chief Whip, Narend Singh, believes a complete review of salaries of all public office bearers should be done.
“It is not the first time he said this. I believe something needs to be said to the commission for remuneration because they determine salary packages. One of the things picked up is the very large difference between ordinary members of parliament and as you rise up to presiding officers, to deputy ministers and ministers.”
Leader of the United Democratic Movement, Bantu Holomisa, added that the finance minister should first collect money looted through COVID-19 tenders.
CEO of Inkunzi Wealth Group, Owen Nkomo, on the suggestion to cut salaries of MPs: