Publications
Partners
Johannesburg - Wage bills in South Africa are crowding out other forms of investments, Business Leadership SA CEO Mike Spicer said on Friday.
Spicer addressed the annual conference of the Black Management Forum (BMF).
Wages make up a significant portion of production costs. Some local employers have raised concerns that higher than inflation wages being demanded by workers means they are unable to invest in other areas of their businesses.
Several areas in the local economy needed to be addressed if South Africa were to progress.
These, he said, included addressing high unemployment and the narrow individual and corporate tax base.
"We have about 15 million people dependent on grants. Every working person sustains the benefits of three people. That is not sustainable," he noted.
"The geese that lay the golden eggs are very few," he said, referring to the low number of companies that are responsible for corporate taxes.
South Africa's low savings rate and a low tax base means that it relies heavily on income from other areas such as capital inflows.
Spicer took a swipe at State Owned Enterprises (SOEs), saying government was "not doing a very good job" of running them.
"Some of the SOEs are running without CEOs and CFOs (chief financial officers)," he told delegates.
A CEO was only recently appointed for Eskom after months of having an acting CEO while transport and logistics SOE Transnet still has an acting CEO almost two years since Maria Ramos stepped down.
Spicer suggested the establishment of economic zones, the adoption of measures that will promote more competition and the improvement of education and health.
Transformation
Businessperson and BMF former president Lot Ndlovu criticised the government and businesses on the slow pace of black economic empowerment (BEE).
He said there had been slow progress and a major bottleneck due to uncertainties around the policy.
Ndlovu said that instituting a charter before a code on BEE contributed to slow transformation.
A commission to govern BEE was a step forward.
He said there was greater need for "inclusivity" and black ownership of the economy.
"For BEE to happen, ownership is paramount. Transformation should deliver a new order," he said.
Inclusivity was emphasised in Thursday’s session of the BMF summit on sustainable and economic growth in South Africa and the rest of the continent.
"Blacks still don't have capital whilst BEE created even more white billionaires. Transformation is poorly positioned," Ndlovu said.
Spicer addressed the annual conference of the Black Management Forum (BMF).
Wages make up a significant portion of production costs. Some local employers have raised concerns that higher than inflation wages being demanded by workers means they are unable to invest in other areas of their businesses.
Several areas in the local economy needed to be addressed if South Africa were to progress.
These, he said, included addressing high unemployment and the narrow individual and corporate tax base.
"We have about 15 million people dependent on grants. Every working person sustains the benefits of three people. That is not sustainable," he noted.
"The geese that lay the golden eggs are very few," he said, referring to the low number of companies that are responsible for corporate taxes.
South Africa's low savings rate and a low tax base means that it relies heavily on income from other areas such as capital inflows.
Spicer took a swipe at State Owned Enterprises (SOEs), saying government was "not doing a very good job" of running them.
"Some of the SOEs are running without CEOs and CFOs (chief financial officers)," he told delegates.
A CEO was only recently appointed for Eskom after months of having an acting CEO while transport and logistics SOE Transnet still has an acting CEO almost two years since Maria Ramos stepped down.
Spicer suggested the establishment of economic zones, the adoption of measures that will promote more competition and the improvement of education and health.
Transformation
Businessperson and BMF former president Lot Ndlovu criticised the government and businesses on the slow pace of black economic empowerment (BEE).
He said there had been slow progress and a major bottleneck due to uncertainties around the policy.
Ndlovu said that instituting a charter before a code on BEE contributed to slow transformation.
A commission to govern BEE was a step forward.
He said there was greater need for "inclusivity" and black ownership of the economy.
"For BEE to happen, ownership is paramount. Transformation should deliver a new order," he said.
Inclusivity was emphasised in Thursday’s session of the BMF summit on sustainable and economic growth in South Africa and the rest of the continent.
"Blacks still don't have capital whilst BEE created even more white billionaires. Transformation is poorly positioned," Ndlovu said.
