The government has put sweeteners on the table to encourage older civil servants to take early retirement, including dropping the penalties that would normally be associated with early withdrawal of pension benefits. Other incentives are planned but have not been finalised.
This is according to finance minister Enoch Godongwana, who this week unveiled the latest public service early retirement programme, worth R11bn, when he tabled his medium-term budget policy statement.
The aim is to trim the high civil service wage bill, which is projected to be almost R300bn a year by 2027. The government hopes to persuade at least 30,000 older civil servants to take early retirement while hiring younger workers at lower salaries.
The government resolved to add the yet-to-be-disclosed sweeteners after its first early retirement offer in 2019 resulted in only about 2,000 civil servants taking up the offer, due to hefty taxation on early pension withdrawals and the loss of other benefits.
“The incentive was not as strong then as it is now [so] we think there will be a good uptake,” he told the Sunday Times. “We can’t disclose the details without finalising and discussing them with the unions. But you must understand this is purely the incentive part, the R11bn. There’s another portion, early retirement without penalty, which is on the pension side.”
But labour union federation Cosatu has spoken out against the move, saying it may result in the loss of skilled and experienced people and less efficient service delivery.
“We are worried that this may see a loss of critical skills that are needed by the state to deliver quality public services that workers, society and the economy depend upon,” said Cosatu parliamentary co-ordinator Matthew Parks.
“The Mandela administration offered voluntary severance packages to teachers and later regretted the impact this had on learning. The government has been asking former employees of Eskom, Transnet, Metro Rail and Denel to return and SAPS placed an advert two weeks ago asking former employees to return.
The public sector is not bloated. In 1994 we had 1-million public servants for 34-million citizens. Today it is 1.2-million for 64-million citizens
— Cosatu’s Matthew Parks
“So we are worried the government is not considering lessons from past mistakes.
“The public sector is not bloated. In 1994 we had 1-million public servants for 34-million citizens. Today it is 1.2-million for 64-million citizens.
“The continuing squeezing of public servants with below-inflation increases is sparking a brain drain of skilled public servants, like nurses, doctors, teachers and police officers who are taking up better paying and less stressful jobs in the private sector and overseas.
“Home affairs has a 60% vacancy rate, SAPS has lost 15% of its staff over the past decade and yet society is then surprised when the state struggles to deliver.”
Simon Hlungwani, president of healthcare workers’ union Denosa and also convener of Cosatu’s negotiators in the public service co-ordinating vargaining council, said certain sectors of the public service were already in a skills crisis.
“Half of the nursing population is nearing retirement, while the shortage of nurses both nationally and internationally is so dire ... and yet the country’s annual intake of student nurses into colleges and universities is reducing instead of increasing.
“If all the nurses, many of whom are in the government’s target range, were to take early retirement, many patients in both general and specialist units would struggle to get nurses to take care of them,” he said.
But Godongwana says there is a plan to ensure critical skills are not lost.
“We have a clause that says subject to skills retention. In other words, the executive authority, which is like me as the minister, can say you can’t go because I’ve got to retain your skills.
“We are not totally focused on savings; we are also bringing in new blood.”
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