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I wish to thank you for inviting me to present the views of government on the challenges facing the Public Service in South Africa. In recent decades societies and economies have undergone momentous changes that have altered key assumptions and patterns of behaviour of governments, institutions, businesses and societies. A key precipitant of these changes is globalisation. It is within this context that I will raise the issues of Bargaining, Managing and Innovation in the Public Service, today.

Globalisation has resulted in greater integration of all countries, with the northern richer countries being by far the dominant parties in this arrangement. The phenomenon of globalisation links economic, cultural and political processes of countries previously separated by their physical boundaries. As a result, what happens in one part of the world tends to have an impact on the rest of the globe, especially through the medium of information and communication technologies and financial transactions.

Globalisation has meant that what one state does within its borders has a direct impact on political, economic and cultural processes in other parts of the globe. States have unequal power and thus some leave larger 'footprints' than others do. It also means that what states do domestically may have a direct consequence internationally. Conversely it also implies that international events tend to have an effect on domestic policy. This is generally seen as reducing the sovereignty of states, particularly those in the developing world and increasing the power of multinational financial, commercial and communications institutions. We know that a strong national state is one of the ways that we can be influential players in global forums. In our international deliberations, South Africa already advocates and has some bearing on the global issues that effect not only our country but the SADC region and Africa as a whole.

Transformation in a Global World

The Public Service in Africa and South Africa to be specific operates within this global environment. The challenges of the Public Service for the 21st century is to ensure that transformation activities are integrated while taking cognisance of what is happening around the globe. Clearly, as a member of the developing world we would also like to ensure that we make an imprint on the global debate which attempts to define the role of the state, and in particular, a developmental state which by its character must be activist.

President Mbeki in his speech on the occasion of the Budget Vote in the Presidency on 13 June said:
"The system of governance we are working to create is radically different from the one we inherited. It is focused away from repression, control and the management of people.

It is targeted at helping us to meet the provision laid down in the Constitution of 'improv(ing) the quality of life of all citizens and free(ing) the potential of each person.' Accordingly, ours must be a developmental state".

When this government assumed office six years ago, it inherited a Public Service system in which there was no respect for organised labour, today we are proud to say that the Public Service is a model employer in which participative management is a way of life.

The new system also brought about new challenges for the trade union movement. Critical among these is how to balance the needs of the employed with the hopes and suffering of our unemployed. We must remember that the central mission of the public service is the development of the country and provision of services to its people. If this is not achieved, the public service will miss its rationale for existence. The partnerships that we have created in the Public Service must make a difference in the lives of all South Africans. Partnerships that are inwardly focused cannot improve service delivery, they cannot eradicate poverty, and they cannot create employment. It is also important for management and labour to recognise their inter-dependence in ensuring that the above mission is realised.

Bargaining in the Public Service

The broad thrust of this year's bargaining has been on a package. The main reason for this approach is that the costs associated with salaries and benefits are related. In addition we aim to extend benefits like housing and medical aid to workers who were previously excluded. It gives government a greater bargaining hand with medical aid administrators and service providers if we can negotiate on the basis of economies of scale. As regards housing, anyone who has applied for a mortgage loan knows that it is not fun. What government wants to do is use the pension fund as a guarantee for securing adequate home loans. In this way, public servants that do not have the credit worthiness as stipulated by financial institutions will receive the backing of the government through the pension fund.

Why have we proposed an across the board percentage increase as opposed to a graduated salary increase? Well it's simple, over the years the effect of a sliding scale has reduced the salaries of highly qualified professionals in the public service, while increasing the salaries at lower unskilled levels. This practice was an important intervention to address the legacy of the apartheid wage gap. At this stage, however, we have to turn the corner. We in fact pay higher salaries at lower levels than the private sector. While government calls for a more effective management core and highly skilled professionals we are not able to retain these people because of a lack of competitiveness. We have to change this situation.

In our global world it is important that we take a step back, now and then, to examine the impact that our bargaining activities have on transformation. Are we really adding value by negotiating salaries centrally when the ICS vote has been moved to departments? Should we still have councils structured along occupational lines? What should be the role of Provinces in bargaining? Is the yearly system of bargaining for salary increases sustainable? Can we introduce a system in which salary negotiations will be linked to the medium term expenditure framework or even to the term of government?

These are some of the questions that need to be answered in our endeavour to build the public service not only as the preferred employer, but also as an institution, which delivers.

Managing the Public Service

The Public Service is also faced with the challenge of developing an accountable and effective management core to ensure the acceleration of service delivery. The South African Management and Development Institute, SAMDI, plays a crucial role in building the capacity of our managers. It is however not only training and development that is necessary but an integrated strategy to build strong management in the public service.

Again, President Mbeki in his speech on the occasion of the Budget Vote in the Presidency on 13 June noted,
"One of the most important challenges thrown upon us is the need for us to sharply improve the professional competence of members of the public service and otherwise to increase the capacity within the public service".

It has been confirmed through a number of studies in the public service that the ability to improve service delivery is dependent on good and strong management. We are therefore pleased that Cabinet approved the establishment of the Senior Management Services (SMS). The establishment of the SMS will help the public service to attract, develop, and retain good managers.

SMS will also benefit the individual member and the society at large. Some of these benefits include:
* The ability of the government to deploy the best managers where there is a particular need.
* A strong and competent senior management team, with relevant public service competencies.
* The flexible remuneration structure will attract highly competent managers to the public service.
* Strong leadership at senior management level which will result in stronger bargaining councils.
* Professionals and specialists at senior management level will be remunerated at the same level as the corresponding level of senior management.

The practice has been that, salary increases of senior managers were not subject to negotiation at the PSCBC, but the other conditions of service were. As from 1 January 2001, the conditions of service for senior managers will no longer be negotiated at the PSCBC and senior managers' salary increases will be effected from 1 January as opposed to the 1st of July. This development obviously affects your members at this level, but we have ensured that senior managers are not worse off because of this change of date.

One of the most important principles underpinning the establishment of the SMS is the call by the President that:

"(our) society must be distinguished, among other things, by the prevalence of a new patriotism... and a new social morality radically different from the morality we have inherited from centuries of colonialism and apartheid."

The SMS will strive to embody these values and to combat and prevent corruption in the public service. An additional set of protocols on conduct will be developed for the SMS that will be enforced through peer review.

Innovating for Better Service Delivery

Service Delivery Innovation, SDI, is an optimum mix of flexible service delivery mechanisms and tools that can be strategically used to achieve Government's service delivery objectives.

Unfortunately, SDI is sometimes associated with outsourcing which results in job losses. This is not so. Service delivery innovation is about developing and introducing new ways of delivering service to communities at affordable rates, this can happen in many ways: electronically, empowering communities to deliver the service, government employees taking over the service delivery, outsourcing to private sector, improving accessibility of services, and so on.

Ultimately, the SDI policy framework will enable us to reorganise the manner in which government delivers services with a view to improving efficiency. Such re-organising will encompass an improvement in the efficiency of existing institutions, utilisation of Public-Private partnerships, establishment of agencies within the government and co-operation with civil society to improve delivery.

A vision for the Public Service

I would like to see a public service in which the interaction between the trade union movement and government will be about issues that will bring a better life for all. I want for us to build a working environment in which conditions of service and salary bargaining is approached within the context of the challenges that face the country as a whole. I challenge you to commit yourself to the principles of Batho Pele and work towards a changing the lives of South African citizens through our service to them. I extend an invitation to all the public service trade unions to share this vision with me and ensure that our activities are guided by this vision.

It is only if we come together within our borders that we can start to assert ourselves in this global arena. It is with this in mind that I invite this congress and the trade union movement at large to become our partners in ensuring good governance, to assist us in fulfilling our mandate to deliver a better life for all.

Thank you

Issued by the Ministry of Public Service and Administration, 12 September 2000