The Tshwane metro’s application for a waiver to pay salary increases in the next financial year has been turned down.
The Local Government Bargaining Council’s (SALGBC) decision comes even after it was found that the metro is in serious financial trouble.
“In this waiver application, the issue of affordability (of salary increases) was one of the main arguments,” reads the SALGBC’s ruling.
“Following the auditor general’s report on the 2021-’22‑ financial statements, and the national treasury’s recommendations, it is clear that (the metro) is in a financial bind and has major liquidity problems.
“However, the 2022-’23‑ financial statements indicate a slight improvement (in the state of affairs), but there are still challenges in relation to liquidity and paying creditors.
“The 2023-’24 budget, which is a prospect, indicates an overall increase in expenditure, but also a 6% increase in income and it is expected that the measures (which the metro has introduced) will go a long way towards its improve financial situation.”
The metro recently began an extensive cost-cutting exercise where it reduced budgets across departments by 30%.
As such, the metro argued in its application that it did not budget for salary increases in the 2023-24 financial year because there was no funding for them.
The municipal workers’ union Samwu, which is one of the applicants in the case, argued in contrast to this that the metro did provide for salary increases in its 2023-24 budget. The union says this is clearly seen when comparing the 2022-’23 and 2023-’24 budgets.
SALGBC concluded that when the more than R12.6 billion budgeted for the coming financial year is compared with the previous financial year’s actual expenditure of R11.5 billion “it is fair to the employer as well as employees to to find that sufficient provision has been made in the 2023-24 budget to pay salary increases amounting to R602 million”.
Selby Bokaba, spokesperson for the Tshwane metro, says SALGBC’s ruling is “disappointing”, as the metro has proven that it cannot afford the increases.
“The metro’s financial position is exceptionally fragile. It is therefore shocking that the SALGBC rejected the waiver application.”
The metro says the ruling “provides clear grounds for review”, and that it will approach the labor court “on an urgent basis” to review the decision.
