By Jon Herskovitz
PRETORIA (Reuters) - The South African government raised its pay offer to civil servants on Thursday to try to avert a strike that could cripple commerce in the continent's largest economy, but the gesture was quickly rejected.
Around one million public sector workers under the umbrella of the country's biggest labour organisation COSATU have threatened a national strike from next week.
Analysts expect more sparring between the groups in the coming days but believe a deal tilted in the unions' favour will be reached to head off a repeat of mass action by civil servants three years ago that battered the economy.
The Public Service Ministry said in a statement that it was prepared to increase salaries by 7 percent, after previously offering 6.5 percent. Its offer of a monthly housing allowance of 630 rand remained unchanged.
Unions are demanding an increase of 8.6 percent -- double the current inflation rate -- and a housing allowance of 1,000 rand, which would put pressure on the state budget.
The government says the combined demands amount to a raise of 9 percent and would make it nearly impossible to fulfil its commitment to bring its budget deficit down from 6.7 percent of GDP. Spending on personnel is the largest sector of the budget.
"These are above what is affordable," Public Services Minister Richard Baloyi told a news conference, urging unions to accept the latest offer or face the prospect of cutbacks in other parts of the budget.
"We have to take painful decisions," he said.
Workers who have threatened to strike include customs and immigration officers, police, health care staff and teachers. Reuters Africa
