Youth Wage Bill Passed

By PAW    02-Nov-2013 11:08 UTC+02:00
Minister of finance Pravin Gordhan. Image:

Minister of finance Pravin Gordhan. Image:

In a show of the waning support now enjoyed by COSATU, the youth wage subsidy bill sailed through parliament despite the fierce opposition that the huge worker organisation had shown way back in 2011 when the bill was first muted by finance minister Mr. Pravin Gordhan. But what is this youth Wage Subsidy Bill and what is the cause of all this furore over it?

In general terms, the Youth Wage Subsidy is an idea proposed by treasury as early as 2010 as a means of encouraging companies to employ younger and less experienced members of the public. It is anticipated that if they employed these young people, they get tax concessions and in this way reducing the startling unemployment figures. The basis of this proposed policy is that it will encourage companies to employ a younger less experienced workforce. However, it’s biggest critic, COSATU believes that it will lead companies to retrench the older members of their staff in preference for the youth for whom they will get tax rebates.

After a three year battle with COSATU, the government was finally able to pass it through parliament on Thursday in the Mother City. It is interesting to note that even the opposition parties voted for the Bill. As far as they are concerned, this Bill should have been passed a long time ago had it not been for the ideological stand off between the parties to the ruling alliance of the trade unionists and the ANC. According to the DA, these parties have compromised when more than a hundred thousand youths have joined the unemployment band. They are quick to point out though that the delay helped reduce the burden on tax payers from about five million rand to just over one million. While this will be welcome news for the workers, it will draw back the the provision of employment for youths.

Some opposition political parties, particularly the DA have claimed this victory, maintaining that it is their lobbying that has resulted in this quick approval. What remains therefore is the need to translate the policy into action on the ground so that the benefits can quickly trickle to the intended beneficiaries.

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