Public servants wage deal to cost state R23bn in three years

The three-year public sector wage agreement deal will cost government an additional R23bn. 

Finance minister Enoch Godongwana on Wednesday delivered the budget speech, revealing that the deal would cost R7.3bn in the 2025/2026 financial year, R7.8bn the following year and R8.2bn in the 2027/2028 financial year. 

"Although the agreement exceeds the 2024 budget and MTBPS [medium term budget policy statement] projections, its duration reduces uncertainty in budget planning. 

"An amount of R11bn is provisionally allocated over the next two fiscal years for the early retirement initiative, whose intention is to attract younger employees into the public service," Godongwana said.

"Preliminary savings are expected to average R7.1bn per year over the medium-to-long term. The savings will be retained by departments. The interventions on the wage bill are aimed at ensuring that when key frontline staff are lost through natural attrition and retirement, sectors are able to fill vacant posts to keep services running effectively."

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