“I'll have what she’s having” is from the memorable restaurant scene in the 1989 comedy, When Harry Met Sally. Although reminiscent of, it is no laughing matter when reading the column’s headline in the “Media Statement on negotiations between SARS and Organised Labour”, released on May 20.
Sars met with the organised labour, represented by the National Education, Health and Allied Workers Union (Nehawu) and the Public Servants Association (PSA), to find a solution to matters that had led to the unions had declared a dispute. To its credit, the Sars delegation averred that the trade unions’ demands for CPI + 7% “is not affordable”. It’s worth noting that, according to Sars’ 2020/21 annual report the organisation has a headcount of 12 479, and that BusinessTech reported in April 20 that “Sars paid 60 people R1-million in salaries to sit at their desks and do nothing”.
CPI stands for the Consumer Price Index. It is the official measure of inflation in South Africa. On May 18, Statistics South Africa (Stats SA) released its CPI for April, which stood at 5.9%. Before reverting to the maths, inflation is defined as a decrease in the purchasing power of money, which is reflected in a general increase in the prices of goods and services in an economy.
So, the trade unions are looking for a 12.5% salary increase for Sars staff; that is, government officials – this, in a country, which had real gross domestic product (GDP) growth of 4.9% in 2021. Real GDP is the value of the goods and services produced by an economy in a specific period, adjusted for inflation.
I have always been amazed that, in South Africa, government officials’ salary increases are not aligned to their productivity. Are government officials’ productivity even measurable? Isn’t there an adage that, if you cannot measure it, you cannot manage it?
Productivity is commonly defined as the ratio between the output volume and the volume of inputs. According to the Organisation for Economic Cooperation and Development, productivity measures how efficiently production inputs such as labour and capital are used in an economy to produce a given level of output.
In case you are still wondering whether it is possible to measure government officials’ productivity – yes, it is, as this has been done in Finland, for instance. Statistics Finland states in a study titled ‘Measuring Public-Sector Productivity in Finland’: “Productivity can be measured in a number of ways. Public-sector productivity is most often measured as labour productivity. In addition to labour productivity, multifactor productivity should also be measured.” Why doesn’t the South African government measure its government officials’ productivity? Surely, this could guide its deliberations and negotiations with trade unions.
The real question Sars negotiators should ask is: What’s the basis of the trade unions’ salary increase demand?
Sars’ funding allocation from the National Treasury apparently made no provision for salary increases, but the revenue service says through its “own diligence in managing costs, and other initiatives” it is able to make some funds available. However, “these funds are from some savings from last year (2021/22) as well as projected savings from this current year (2022/23) which has been approved towards people costs”.
Quite poignantly, the Sars commissioner states: “I am pleased that, under difficult condition, we are able to provide some financial relief to our employees. I also remind our employees that we are inordinately privileged to have employment security at a time when so many are unemployed and financially destitute.”
Just how “inordinately privileged” are they? Do they need to be reminded of that? On March 29, Stats SA announced that the unemployment rate rose to a record high of 35.3% in the fourth quarter of 2021. Under the expanded definition of unemployment, which includes citizens who have despaired of finding work, the rate is 46.2%.