South Africa Warns Ministers of Coming Cuts to Pay and Perks
South Africa Warns Ministers of Coming Cuts to Pay and Perks
When a government unveils a hard-times budget, like South Africa did on Wednesday, officials usually take steps to show that they will share the pain with their fellow citizens.
So it was that Finance Minister Tito Mboweni, after urging talks with labor unions to try to limit government workers’ salary increases, said compensation for ministers and other executives will be frozen, “with the likelihood of an adjustment downwards.”
Whether that will persuade workers remains to be seen. After all, Mboweni outlined in his medium-term budget policy statement other restraints for senior officials that may not resonate with the average employee.
For example, the cost of official cars will be capped at 700,000 rand ($48,000), including value-added tax. Cell-phone expenses also will be limited, and domestic flights will be economy class. And no more daily travel expenses, either.
In his budget prepared speech to the 490-members of Parliament, the finance minister also put the ball in their court. He challenged them “to think about how they can further contain their compensation and benefits.”
To contact the reporter on this story: John McCorry in New York at jmccorry@bloomberg.net
To contact the editors responsible for this story: David Merritt at dmerritt1@bloomberg.net, Robert Brand, Ana Monteiro
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