Zuma may launch wage subsidy for youth

2011-02-06 09:38

Cape Town - On Thursday evening President Jacob Zuma will probably announce the introduction of wage subsidies early this year to stimulate employment of young people.

The subsidy is aimed at encouraging employers to hire these youngsters.

Treasury has been working for months to find finance for these subsidies. Details will probably be outlined in Finance Minister Pravin Gordhan’s budget speech, which he will table on February 23.

Gordhan made this proposal in his 2010 budget speech, but it elicited such resistance from trade federation Cosatu that little was said or done about it last year.

He promised that a discussion document on the issue would be published by end-March 2010, but this was never done – in all likelihood because of Cosatu’s opposition.

Sake24 has however ascertained that this discussion document was indeed drawn up and distributed to members of cabinet and senior state officials in the economic departments in the course of 2010. It will now form the basis of Gordhan’s announcements in the budget speech.

The state will probably have to provide billions for these wage subsidies. They could be financed by tax concessions.

Measures to provide work for the youth are being frustrated by entry-level wages that are too high.

In 2010 Gordhan proposed a tax concession to be implemented through an employer’s wage taxation system. It would probably be subject to minimum labour standards that are lower than existing minimum conditions of employment.

About 500 000 school-leavers who would otherwise not find jobs could in this way find themselves employed by 2013.

-    Sake24

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  • Siegfried - 2011-02-06 10:07

    Is this the ANC’s ‘Evolution by Numbers’ ethos starting to blow up in their faces..? As is customary, the ANC makes promises it does not understand; viz how it will be financed, implemented and/or administrated – not a problem though, just blame Apartheid because you don’t understand what you are saying... Welcome to Planet ANC: give the unemployable false qualifications, then pay them false salaries, entertain them with false promises and keep them healthy and voting for free – what is not sustainable about that..? Productivity is just an evil from the West...

  • Brian - 2011-02-06 10:34

    Buying more votes.

  • JK - 2011-02-06 11:26

    I presume this will only be applicable for black's

  • Mike881 - 2011-02-06 11:27

    What a stupid - election prompted idea. The funding has to come from somewhere which will mean that Government will be taking more, which will in itself result in fewer jobs. They might as well introduce the UK dole system - totally stupid in SA where we want to promote job creation. Instead we should be following the example set by Mozambique when they reopened their borders - the Moz Government set max initial salaries/wages very low. The idea being that labour was cheap and more people were employed rather than fewer.

  • Thulani Mahlangu - 2011-02-06 14:15

    I like the idea, but why is the government not investing more in education, and push the One School One Library One Librarian Campaign? Surely this will put the youth in more secure jobs than handing companies wage subsidies, which will results in more youth being sacked. I would surely say that our government is failing us. DAH!!! where's DA to come to rescue?! And come employ your policy for prioritizing education. Okay, the approach is good, but what's going to happen 10 years from now? Will those number of youths still having their Afr jobs? Think South Africa, this is our country and we have a right to choose whichever party that we would like to be led by. To the ANC. please don't only think for today, also consider the future. more especially of the youth. And more over: Could you please start thinking with your brains, not your butts.

  • Sam - 2011-02-06 18:48

    Nothing comes for free from Zuma, and most importantly Gordhan. Its always at a price.......

  • BB - 2011-02-06 19:29

    Thank you government for finding yet another way to steal my hard-earned money! We looove you!

  • Jabulani Sikhakhane - 2011-02-06 19:45

    The Minister of Finance announced in October last year a R6 billion allocation (for the three year period - 2011/12 to 2013/14) to finance innovative youth employment projects. Enterpreneurs with sound ideas on how to graft young people onto the world of work should contact National Treasury.

  • Greg - 2011-02-06 20:43

    Do the ANC think employers are so stupid as to give these people a foot in the door? Once in, they will use the unions to manipulate the situation even further and you wont be able to get rid of them!

  • Collitjies - 2011-02-06 21:38

    It will pay the youngsters to do even less, lets face it most of the youngsters applying for employment are unemployable anyway. Their matric passes are totally under par, so they know uckall.

  • anon - 2011-02-07 09:16

    I agree with you Brian. You couldn't have said it better. Buying more votes

  • Plots - 2011-02-07 13:59

    We keep hearing how the ANC is trying to create jobs for the school leaver yet we continuously hear about the shortages of staff in municipal and government departments. Would it not be wise to start programs to encourage the unemployed to fill these positions and honest advancement through the ranks. Is this not possible because the standard of education has dropped so badly even the ANC admits they can't employ these people?

  • cvdm - 2011-02-08 17:45

    Before I do accept.. WILL I HAVE TO PAY TAX?

  • Mosso - 2011-02-09 19:38

    @Greg...Dude u are delusional, Stay off the green period! Lmfao!

  • Mosso - 2011-02-09 19:40

    @Collitjies...That's why we have what is called RECRUITMENT PROCESS! Dude,,get with the program!!! Geeeees!

  • Mosso - 2011-02-09 19:42

    @JK,,,,I don't even know what to say to you...*speechless*

  • MACHUPE - 2011-02-10 13:25


  • Jay - 2011-02-10 21:09

    Priceless!!! Shalom

  • DR - 2011-02-13 08:34

    @JK, well said, BEE will definitely play a role in this.

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