PUBLIC-sector wage talks took an unexpected turn yesterday when negotiations collapsed within sight of the finishing line.

It had been anticipated that a deal would be signed on Tuesday. Instead talks ended with unions affiliated to the Congress of South African Trade Unions declaring a dispute, and accusing government negotiators of bad faith and dishonesty.

It would have been a great moment for Public Service and Administration Minister Lindiwe Sisulu who, after only a month in the post, would have taken the credit for clinching a deal that eluded her predecessor. Instead, Ms Sisulu's planned press conference was hastily cancelled amid confusing explanations from her office.

Insider (and unofficial) accounts of the deal suggest it would have been a multiyear agreement based on a consumer price index (CPI) plus 1% annual increase. Such a deal would have been easy for markets and the private sector to live with.

While it is "over budget" by more than R8bn when compared with the 5% that Finance Minister Pravin Gordhan planned for in the budget in February, it is a nowhere near the generous increases awarded to the public sector in recent years.

Mr Gordhan's 5% was never going to fly anyway, especially since it was lower than inflation for the past year, which the Treasury has calculated to be 5,9%. To emerge with only a 1% real increase for the public sector, in a context where there is a good deal of anger and resentment over South Africa's economic and earnings disparities, and where public-sector unions are strong, cannot be described as a bad deal.

So what went wrong?

The most confusing account comes from Ms Sisulu's office. Her spokesman, Ndivhuwo Mabaya, says the offer of 6,9% - in other words, CPI plus 1% - was never formally tabled. All that had occurred in the previous meeting with the unions, he says, is that government negotiators - anxious to ascertain what the union's settlement level would be - had suggested that unions canvass their members to find out whether the offer of CPI plus one would be acceptable. This was not a formal offer, he says.

Of course, say the unions, such a claim is ludicrous. How could unions be asked to canvass members on a settlement offer that was not real?

A more plausible explanation comes from within the ranks of the unions. In their understanding, it had been made clear - not by government negotiators but by the political leadership involved - that a deal for CPI plus one was on the table. All that was required was a little tidying up here and there, such as deciding upon the final cutoff date for the period over which CPI would be calculated.

It seems, though, that the political deal had not been processed through government structures.

Government negotiators are bound by the mandate they get from their political principals, who sit in a committee which includes the ministers of public administration and of finance. Since the offer had not yet been discussed by the mandating committee, negotiators found themselves in a tricky position of having made an offer - presumably on the instruction of Ms Sisulu - that they later had to claim they had not made at all.

This also accounts for the hurt and angry response of the unions which have lost no time in declaring a dispute, which will now be the subject of a mediation.

While the final settlement will in all likelihood be something the shape and size of what Ms Sisulu wants, there is no deal yet - and thus the minister will have to wait to receive her accolades.