FINANCE Minister Pravin Gordhan has voiced impatience with
delays in the introduction of his proposed youth wage subsidy.
"There are unresolved issues with respect to the youth
wage subsidy," he told a joint sitting of parliament's standing committees
of finance and appropriations a day after tabling his annual budget.
"Our challenge over the next six months is to very
quickly build some consensus around what we could do so that we talk less about
what we want to do and do what we want to do."
The subsidy, in the form of a R5bn tax credit over
three years, was meant to be introduced on April 1, but Gordhan announced in
his budget speech that for the moment it remains before Nedlac for discussion.
In the committee, he confirmed that a major obstacle was the
Congress of SA Trade Unions' fears that it would lead to employers getting rid
of older workers.
"We have heard the views of the labour in this regard,
that they have some design concerns. Among the primary concerns of some of the
labour movement is the substitution effect -- that businesses could employ
younger, inexperienced workers, get the subsidy and displace older
Gordhan said it was a genuine concern and his department had
undertaken to address it in the way it designed the subsidy.
"For the last few months that is a discussion that has been
going on within the Nedlac forum."
He said that at a National Economic Development and Labour
Council meeting early in February, members were asked for their input on the
budget, but also urged to resolve the subsidy debate.
"At that meeting, we indicated that at some stage soon
the talking must stop and we must decide whether we can reach agreement on a
redesigned subsidy, or mechanism, or incentive which will ensure that the state
incentivises employment within the private sector, but also in the social
sector where that might be appropriate."
Democratic Alliance finance spokesperson Tim Harris asked the
minister whether there were legal obstacles to implementing the initiative.
"No, but I think our ideal is always to find consensus
with different roleplayers if we can. We will make another attempt in the short
term, we will take this back into the government system and we will get some
guidance on what we do with it."
He added: "We do want to repeat the message that the
talking has to stop at some stage and the doing has to start at some