SOUTH Africa can’t implement a pay deal with public servants because it would precipitate a fiscal crisis, Finance Minister Tito Mboweni said.
The government and labour unions will square off in the Labour Appeal Court on Dec. 2 over Mboweni’s proposal to freeze wages that have surged 51% since 2008.
Last week, Fitch Ratings and Moody’s Investors Service cut South Africa’s debt assessments deeper into junk, saying the state may struggle to stick to its plan to rein in spending.
“What government and the South African economy cannot now afford, and what is not just and equitable under the current circumstances, is for civil servants to claim yet further inflation-beating and private sector outperforming salary increases off an already high base,” Mboweni said in court documents.
South Africa’s government reneged on a three-year pay deal earlier this year and Mboweni said last month it will freeze wages for the coming
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