The National Union of the Public Service and Allied Workers (NUPSAW) welcomes the President’s address on the issue of COVID19 and announcing a stimulus package of R500bn. However, NUPSAW is concerned that the government has forgotten important role of the Community Health Workers (CHWs) and other essential workers.
Community Health Workers (CHWs) are going home with only a stipend of R3500 with no benefits and other essential workers are going home with extremely low wages. NUPSAW calls on the President to employ the CHWs on a permanent basis and pay them accordingly, also start a funding for all essential workers to receive the coronavirus danger allowance and income tax relief for the period of 6 months. Compensation for the risk to peoples’ health, it would be a step towards valuing all key workers on the front line and failure to do so, then Community Health Workers (CHWs) and other health care workers will have no choice but to down tools come the end of the lockdown and lifting or repeal Disaster Management Act Regulations.
President has announced an unusual R500bn social and economic relief package which will equal to the 10% of the country’s Gross Domestic Product (GDP). About R200bn of this package will be in a form of loan guarantee from various banks, another R100bn is to protect and create jobs, while another R50bn will be used to boost welfare grants. This package seems to clearly lack implementation details however the details might be on the Thursday’s, 23 April 2020 announcement as the President said.
He has also provided a doubtful answer to the question of R130bn and the changing of priorities from the existing package, while the rest would be raised from global financial institutions like the Unemployment Insurance Fund (UIF). Another important issue during COVID-19 is the lack of proper and ethical distribution of food has been found limited and to date the government has not been able to facilitate this distribution to ensure that the poor receive the parcels fairly without the political hands coming to do more corruption.
There are also some interesting opportunities in this stimulus package, the President announced a basic income grant for the unemployment of R350 per month. That’s a small amount but the Union is awaiting Ministerial address on the consequence since the Department has already indicated challenges from system overload, shortage of staff and unexpected volume of applications for UIF and poverty relief grants of food parcels.
Given the country’s poor record on delivery, there are many issues that lie between committing money and having it effectively delivered more than ever before, time is of essence here to save the economy. Government needs to ensure that this emergency funding gets directly to companies and the hungry quick and corruption-free as possible. That will be the challenge.
NUPSAW is still against South Africa’s intention to approach the International Monetary Fund (IMF) and World Bank for the relief loan. This loan from the international institutions needs to be debated as borrowing money in a foreign currency always has a condition which is payment of the debt in that foreign currency. We must seek truth from facts as the IMF funds also comes with difficult economic conditions created by government measures to reduce public expenditure measures in exchange for loans, there may be cuts in social grants, cuts in pensions, layoffs in public service, increased taxes, public service wage cuts, VAT increase, lifting of retirement age, higher pension contributions, privatization.
This package also creates real practical risk, financing this R500bn will create an even bigger challenge to South African public finances. What will happen after the COVID-19 ordeal is over, for example, when the government tries to reduce the grants or some of the additional benefits it is injecting into the system now.
For more information:
NUPSAW Media Officer
Cell: 083 712 1614