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Home » Industry News » Business Advisory & Financial Services » MTBPS2023: Public sector wage bill killing growth and hope

MTBPS2023: Public sector wage bill killing growth and hope

Responding to the Medium-Term Budget Policy Statement (MTBPS), delivered by Finance Minister, Enoch Godongwana, Premier Alan Winde and provincial Minister of Finance and Economic Opportunities, Mireille Wenger, expressed their dismay at the lack of a clear and bold plan to drastically boost economic growth and job creation.

Western Cape Minister of Finance and Economic Opportunities, Mireille Wenger.

“In-year cuts, meaning funding that had already been allocated to the provincial government in the Main Budget in February of this year, and which now must be cut due to national governments’ mismanagement of the economy and specifically the centrally agreed-to public sector wage bill, will devastate economic recovery and any possibility of the kind of growth we need to lift more people out of poverty. Essentially, these cuts are compromising the Western Cape’s ability to provide frontlines services, such as education and health. This is simply unforgivable,” said Minister Wenger.

Premier Alan Winde said, “I am deeply disappointed in the MTBPS. Our finances are already under pressure. We simply cannot absorb the agreed increases to the public service wage bill. It is our duty – as it is national government’s – to protect frontline services at all costs! The needs of our citizens are of utmost importance.

He reiterated, “Provinces should not be burdened with the centrally negotiated public sector pay increase. This will be disastrous for service delivery.”

Compounding the Western Cape’s woes were the devastating floods that hit the province in June and September. The Heritage long weekend storms and floods alone have cost the province R500 million and counting. The Premier welcomed the allocation of R1.6 billion for flood relief but urged national government to urgently clarify how much the Western Cape will be allocated adding that given the severity of the disasters, the province must be given its fair share.

“Positive change requires a clear strategy and decisive action towards achieving our goals. It also requires that government focus on enabling the private sector because, to put it simply, it is the private sector that creates jobs, and it is government’s role to make it as easy as possible for it to do so. This sentiment is at the heart of the Western Cape Government’s economic action plan, ‘Growth For Jobs’, which aims to achieve a R1 trillion, jobs-rich, inclusive, resilient, thriving, and diverse provincial economy that is growing between 4 and 6% in real terms, by 2035. The only way we will effectively address the challenges we face, is by enabling what we call “breakout economic growth” that will create many more jobs for the residents of the Western Cape and South Africa,” said Minister Wenger.

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