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The Medium-Term Budget Policy Statement (MTBPS) might have been filled to the brim with bad news for South African taxpaying suckers, but not if you’re one of the thousands of government-employed millionaires suckling at the tax-teat.

According to the statement, the number of government employees earning over R1 million per year has increased by 450% from a decade ago, with 55,000 public workers now considered millionaires. Must be nice.

According to the National Treasury, this large rise results from government determinations and collective bargaining agreements, which are examined regularly to guarantee fairness and competitiveness, as well as alignment with economic conditions and government priorities.

Fairness to whom you may ask, and also, what exactly are the government’s real priorities?

It added that “pay progression agreements, pension contributions benefits and allowances – such as overtime pay, housing allowance, and medical aid – have to increase with the relevant inflation rate, and this, in turn, increases the total wage bill every year.”

According to the data, the number of employees with annual earnings above R1 million per year has increased from just above 10,000 in 2013/2014 to over 55,000 in 2023/2024.

180,000 employees earn between R600,000 and R1,000,000 per annum – equating to between R50,000 and R84,000 per month – while almost half of all 1.3 million government employees earn over R350,000 per year.

This explains why South Africa’s wage bill is among the highest of all the emerging economies, and national and provincial employees earn above inflation increases even though most services in most provinces are virtually non-existent. Again, must be nice.

Godongwana added that “consolidated government spending, on average, consistently grew faster than GDP and consolidated revenue, mainly driven by the public-service wage bill and rising debt-service costs.”

Despite this being an unbearable burden on the national purse, a two-year pay raise deal earlier this year snuffed out any hope of managing this bloated business when the majority of the public sector unions settled on a 7.5% salary raise. The public salary bill is now estimated to reach R769 billion by 2026.

Godongwana further said that the government aims to contain the wage bill by ‘encouraging’ employees to take early retirement and ‘placing restrictions on the filling of non-critical posts’.

The only silver lining in this circus seems to be the silver trim your municipal manager is putting on his new Mercedes.

Pay your taxes, people, it’s the right thing to do.

[source:businesstech]