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The South African Federation of Trade Unions has condemned what it called the obscene earnings of banking executives amidst working class poverty.
It said recent figures have shown that the executives of at least four banks in South Africa – namely, Capitec, Nedbank, Investec, and FNB – have raked in millions of rands in executive pay.
As an example, Saftu said in a statement: “In the financial year 2023, Fani Titi, Investec CEO, earned R175 million or R475,452 a day – that is, he earned in a day what an average worker earns in a year.
“In the same financial year 2023, the combined earnings of top banking executives of above-named banks amounted to R456,24 million.
“This in a country the most unequal in the world.”
The union said while the dominant narrative in mainstream economic circles was that the major contributor to South Africa’s low growth is the inflexible labour regime and the above inflation wage demands by workers, “evidence shows as false the ideological narrative of the mainstream”.
For instance, 75% of the workforce in South Africans earned less than R5800 in 2022, while a food basket for an average household costs R5300. Moreover, South Africa’s Gini Index, which compares before tax earnings of the highest earners with lowest, is of 63 – the worst in the world. In a word, South Africa is the most unequal country in the world. Yet, we are expected to believe that the measly earnings workers are problem in the economy, and not the hefty pay packages of corporate executives, Saftu said.
“This massive transfer of wealth to the bankers takes the form of bank charges, interest payments on loan repayments, overdraft facilities, etc,” said Saftu media officer, Mogoshadi Maserumule.
By 2022 already, two years following the Covid-19 induced lockdowns, the banking sector was recording huge profits - with Capitec Bank, FNB, ABSA Group, Standard Bank all registering above 10% profit increases, she added.
“It is this transfer of wealth to the bankers, aided and abetted by the SARB, that is the source the hefty packages accruing to top banking executives.
“This confirms what we have always maintained: that interests rates, ramped up by the SARB in the name of protecting the purchasing power of working class and the poor from the vagaries of inflation, are but a pretext to enrich the bankers and their hangers-on in the money market.”
