Cape Town - An economist has cast doubt on whether South Africa’s premiers, MECs and MPLs are giving bang for the taxpayer’s buck following the gazetting of their approved 3% salary increments backdated to April 2022.
This as the latest BankservAfrica Take-Home Pay Index (BTPI) reported the average nominal take-home pay in South Africa for June this year was R14 596.
However, if you happen to be a premier, you took home R199 839 and if you were an MEC, your salary was R174 853, while MPLs got R97 368 following President Cyril Ramaphosa’s recent announcement of the determination of their salaries.
In the Western Cape, the new salaries were tabled in the legislature on July 21 and the new pay was published in the Provincial Gazette Extraordinary 8797, dated July 20.
CPUT applied economics head Maarten van Doesburgh said: “We give these people these massive salaries and make them millionaires year on year. It’s a very serious situation.”
He said it was necessary to ensure that taxpayers and citizens got value for what they paid for and that performance-related salaries were necessary.
“Dare I say it. What would more than half of these government officials take home if they were held to a performance-based remuneration package?
“I’m afraid some of them may go home with nothing.”
Efficient group economist Dawie Roodt said he thought giving any increase to the office-bearers in South Africa at the moment, was “very insensitive”.
Roodt said this was because the economy was not growing and there were massive levels of unemployment and rising levels of poverty.
“I think it would have been a good gesture from the president to say: ‘listen, you guys get a lot of money but we really have to put measures in place to make sure that you’ve actually earned this money and that means improve service delivery’.”
Roodt said he had no problem paying bureaucrats a lot of money.
“In fact, I think bureaucrats should be paid a lot of money, but they have to earn it. I really don’t think, in most cases, that our bureaucrats in South Africa actually earn the money that they get.”
Cosatu said it was disappointed with the decision to approve the 3% salary increase for public office-bearers and described it as “tone-deaf and embarrassing” as the National Treasury had only recommended 1.5%.
“Load shedding, the rising cost of living, corruption and a stagnant economy have all happened under the watch and leadership of political office-bearers.
“They do not deserve the packages they currently earn, let alone an increase in their salaries,” Cosatu said in a statement.
The BTPI indicates trends in South African salaries, derived from the salary payments made to approximately three million people or about 36% of the country’s workforce.
Weekly-pay data is adjusted to monthly rates, and social security payments, around 3.8 million payments of approximately R1000 are excluded from the data set.
BankservAfrica’s Stakeholder Engagements head Shergeran Naidoo said that this average exceeded the R14 579 level shown in June 2022 and was higher than the R14 483 from May 2023.
Independent Economist Elize Kruger said that this stabilisation in salaries noted since April was welcome.
She said it came against the backdrop of economic activity dampened by the ongoing load shedding, rising interest rates, a lacklustre job market and low confidence levels.
However, Kruger also said that on a year-on-year basis, the average real take-home pay remains in negative territory.
“Salary earners have had to deal with a double-whammy during the past year of disappointing average nominal wage increases and high consumer inflation,” Kruger said.
“The erosion of households’ purchasing power has been evident in declining retail sales.
“StatsSA recently indicated that real retail sales for the first five months of 2023 are 1.2% below the corresponding period in 2022,” Kruger said.