Government wages versus grants in South Africa: It’s scary!

In the latest comparison between government wages versus grants in South Africa, the glaring discrepancy between social relief and public-sector salaries is obvious.

QUESTION | Must pensioners reapply for SASSA Old Age Grants in April 2024?

This information comes courtesy of the 2024 National Treasury Macroeconomic Policy Review, as reported by Daily Investor.

In this look at government wages vs grants in South Africa, the average government salary sits at R465 000 per year (R38 750 per month).

Moreover, the government employee wage bill has skyrocketed in the last decade.

From R408 billion in 2013/14, it now stands at R724 billion in 2023/24.

GOVERNMENT WAGES VS GRANTS IN SOUTH AFRICA

Let’s not forget that nearly 30 million citizens live in poverty in South Africa – meaning they earn less than R760 per month – according to the Social Policy Initiative.

Contrast this with South African government wages which are some of the highest in the world.

As reported by The South African, in just 10 years, government salaries have quadrupled.

And the number of millionaire civil servants has risen from 10 000 to 55 000 in that period. It pays to have a cushy government job, it seems.

GRANTS IN SOUTH AFRICA STAY FLAT

Meanwhile, spending by the South African Social Security Agency on the neediest citizens has stayed pretty much flat in three decades, when adjusting for inflation, since the dawn of democracy.

Next month (April 2024) will see an increase across all SASSA grants.

However, we also know a SASSA state pension pales in comparison to similar schemes overseas, being anywhere from four- to eight- times below the average paid out in Europe.

Delving deeper into the National Treasury report, over the review period, personnel in most government functions stayed static at 1.25 million employees.

Government has actually tried to slow the growth of the public-sector wage bill. The wage bill increase has declined from 35.7% to 32.1%, as a share of government spending.

PUBLIC SECTOR WAGES

Nevertheless, Finance Minister Enoch Godongwana did say he would honour a 7.5% wage increase, even though 4.5% was the initially agreed amount that’s been adjusted to meet the high cost of living.

This will place an additional R23.6 billion burden on South Africa’s national budget.

Even though the rate of public wage increases is slowing, sadly, social grants are not increasing anywhere in line with annual inflation, while government salaries continue to increase at significantly higher rates.