DA demands answers on bargaining council exemption

Issued by Cllr. Nicole Graham – DA eThekwini Caucus Leader
20 May 2020 in Press Statements

The Democratic Alliance (DA) in eThekwini has written to the city management to request clarity as to whether the municipality applied for exemption from the clauses of the South African Local Government Bargaining Council Agreement that pertain to staff salary increases.

The Bargaining Council Agreement – contained in circular 6/2018 – is applicable until the end of June 2021. It is concluded between the municipal unions and the South African Local Government Association, which represents municipalities.

This agreement has been the sole defence of the eThekwini Municipality when queries arose about why staff increases, bonuses and thirteenth cheques remained in the draft 2020/2021 budget.

The city has repeatedly claimed that they were bound by the agreement and implied that they were powerless to reverse the 9.5% overall increase for staff. The overall staff costs are to go up by R1.1 billion from the current financial year to the projected costs in the draft budget.

The reality is that the bargaining council agreement contains an extensive exemption clause that allows any party or person bound by the agreement to apply for exemption from any provision of the agreement. Clause 11 of the agreement outlines an extensive process for this and outlines a thirty day turnaround time for the exemption application to be heard.

It goes on to outline reasons that must be considered when the application for exemption is heard, which include the municipality’s capacity to afford the terms of the agreement if the municipality is having cash-flow problems and unexpected economic hardship and subsequent job losses. All of these are applicable in the case of eThekwini.

In line with this, the DA wrote to city management on Sunday to request the following answers:

1) Did eThekwini apply for any exemptions via the process in the bargaining council agreement?

2) Has eThekwini sought proper legal advice on the potential success of an exemption application?

3) Has eThekwini sought to negotiate with unions to bring down salaries and perks by mutual consent?

To date, no one has replied. This is a worrying sign.

During Tuesday’s EXCO meeting, the ANC rallied around a proposal to implement pay increases for Councillors at 100% of the gazetted upper limit. This means that Councillors will also receive a 4% salary increase.

The DA proposed that this be brought down to 0% but this was not supported by the majority of EXCO.

The municipality is facing serious cash flow problems, with a 56% collection rate in April. The city’s own research predicted cash-flow and economic problems related to the pandemic from March, which left ample time to apply for an exemption or engage in negotiations.

It is untenable that rates and tariffs go up and eThekwini’s unemployment rate soars to a projected 42% but city Councillors and staff continue to rake in increases.

It is now clear that the eThekwini Municipality was not powerless in the face of the Bargaining Council agreement. It could have and should have applied for exemption.

The questions that remain are simple: what did the city do to alleviate the massive staff costs when it had the chance? Why are city leadership and management so intent on continuing with these increases when it is clear the city is in serious financial trouble?

The DA will keep fighting for ordinary eThekwini residents and ensuring that the municipality’s finances stabilise.