Economic development minister, Ebrahim Patel said on Thursday government has ruled out implementing a youth wage subsidy without further social consensus.
He told parliament further debate was needed over the issue.
The initiative aims to help first-time job seekers gain entry into the labour market.
Patel said government needs consensus on how to address youth unemployment instead of a forceful approach to push through a single measure in the face of strong opposition, especially from Congress of South African Trade Unions (Cosatu).
But the Democratic Alliance’s (DA) Tim Harris has lashed out at the state over its reluctance to impose the initiative.
Patel said the debate on the issue must be widened and added that no single solution to unemployment among the youth would be effective.
The finance ministry has budgeted R5 billion from the subsidy.
The African Christian Democratic Party (ACDP) Steve Swart said strong leadership is needed to implement the subsidy.
“We are very disappointed by Minister of Economic Development Ebrahim Patel's response today. While we appreciate it, a multi-pronged response is necessary. It seems the youth wage subsidy has been shelved in favour of a job seekers allowance.”
The Democratic Alliance's (DA) Tim Harris said President Zuma had failed the unemployed youth.
“They have broken a promise made to those young people two-and-a-half years ago. Minister Patel says we behave as if this government has policies designed to keep young people out of work. Well, Minister Patel, that’s because you do.”
(Edited by Tamsin Wort)