Media Monitor 5 November 2009

Talks resume today after a week-long break during which the National Union of Mineworkers, which is demanding an "unshakable" 14%, was expected to consult its members on Lonmin's 9.6% wage offer for lowest category and 8% for highest category employees.

NUM spokesman Lesiba Seshoka said the union anticipates "big moves" at today's negotiations to secure a wage deal.

"Hopefully, these negotiations won't result in a formal dispute, but the company should also not dilly-dally because we won't accept anything less than 14%."

NUM's initial demand was 25%, which was later dropped to 20% before the union tabled a 14% offer at the last bargaining round.

Negotiating in a separate wage forum at the same mine, trade union Solidarity, which is demanding a 10% wage increase, last week rejected Lonmin's 7.5% offer.

Jaco Kleynhans, Solidarity spokesman, said his union was "definitely not" going to accept any wage offer below 10%.

Labour expert Andrew Levy said the parties needed to add more time to "find each other."

"I can't see the company settling at 14% in these economic times, also considering that inflation dropped significantly in recent months," he said.

http://www.timeslive.co.za/business/article180268.ece

1.2 Labour broking is vital service, says ILO paper

But temps are first to go in tough times

Samantha Enslin-Payne, Business Report, 5 November 2009

The International Labour Organisation (ILO) has come out in support of labour brokers - a move that will not prove popular with union federation Cosatu and other opponents of casual labour.

Research by the ILO, a UN agency that promotes social justice and human and labour rights, shows that private employment agencies help to promote better functioning labour markets, as they match supply and demand.

They also allow companies greater flexibility to increase or decrease their workforce, and in good times promote higher labour participation rates, the research shows.

However, workers employed by labour brokers have been first in the firing line as companies worldwide shed temporary staff as an initial defence against the global recession.

John Myers, an industry specialist from the ILO's sectoral activities department, said the private employment agency industry had grown at an incredible pace over the past three decades due to the increasing need to provide workers to a growing market. But since mid-2008, enterprises have used this pressure valve function to lay off temporary workers, while often leaving their core workforces intact, he said.

South African temporary workers have also been hit hard.

Solidarity spokesman Jaco Kleynhans said: "By the time we get to negotiations on retrenchments, companies have already cut temporary staff."

He said, based on the sectors where Solidarity organised and "what we know", about 28 000 temporary jobs had been lost.

The number of temporary workers unemployed is likely to be higher given that in the first nine months of the year almost 1 million people lost their jobs.

A survey released yesterday by international placements agency Manpower shows that temporary workers in South Africa are mostly employed in the restaurant and hotel sector.

This sector, which includes retail, has been the worst hit, with 324 000 jobs lost in the year to September. Another sector that could shed thousands of temporary jobs is construction.

Louwtjie Nel, the group chief executive of WBHO, said 60 percent of its 12 500 strong workforce were temporary staff. "That is the nature of this business. If we can maintain turnover then we can maintain staff, but industry turnover is definitely dropping off."

He said middle-tier building contractors that relied on private sector work faced pressure.

Richard Pike, the chief executive of staffing firm Adcorp, said the trend differed according to industry and between blue and white collar workers. In retail banking the first jobs to be cut had been contract staff, but there had been an uptick in manufacturers using contract workers as a "survival tactic".

Pike said temporary work created opportunities as it was a major conduit for first-time employees into the job market as Adcorp helped train them.

On any given day Adcorp has 92 000 people on contract assignment. Of the total, 35 percent would become permanently employed within a year.

The temporary employment industry in South Africa has about 500 000 people on assignment everyday. It has come under intense scrutiny this year after Cosatu called for its banning, which received some government support.

But the ILO research shows that agencies play a role as intermediaries in modern labour markets, giving business greater flexibility, while ensuring workers security in terms of job opportunities and standards.

Chief executive of Landelahni Recruitment Group Sandra Burmeister said this was particularly the case when you had a strong professionalised temporary employment service sector, as in South Africa.

The industry is pushing for further regulation of the sector, setting up a board and making it mandatory for recruitment firms to belong to. Currently belonging to an industry association is voluntary.

http://www.busrep.co.za/index.php?from=rss_&fArticleId=3395738

2 COSATU

2.1 Crass materialism threatening SA

Ido Lekota, Sowetan, 5 November 2009

POLITICAL NOTEBOOK

To create wealth at the state’s expense is becoming a culture

SPEAKING at the Business South Africa anti-corruption forum last week, Cosatu general secretary Zwelinzima Vavi spoke about the cancer of corruption ravaging South Africa and how a culture of crass materialism in our society is threatening the foundations of this country’s democracy.

Vavi went further and articulated how the country’s attainment of a democratic order has actually become a blight on our hopes of becoming a more equal society.

“The 1994 historic breakthrough has opened a completely new chapter for everyone. But as Chinese leader Deng Xiaoping said: ‘A country is just like a house, it has windows and gates. If you close the window you get no fresh air, and also no flies. But if you open the window fresh air comes in and also some flies.’

“This is exactly what is happening in our country.

“A disturbing culture has blown in through the window and taken root in our society and our movement, which threatens to erode the moral and ethics of our revolution and is silently threatening our national democratic movement,” Vavi said.

He blames this phenomenon largely on the private sector.

“While of course the majority of businessmen and women – and we can say the same about our political leadership – obey the law and do not get involved in corruption there is a capitalist culture that praises and rewards those who accumulate the most wealth and despises those who ‘fail’,” Vavi went on to say.

His argument is that business people bribed public officials to get business from government.

“For every person who receives a bribe there is another who gives the bribe. For every corrupt councillor or public official there is a corrupt businessman or woman,” Vavi said .

His argument cannot be faulted when it comes to how businesspeople wave their cheque books at public officials who then bend the rules to grant contracts to their benefactors – usually at huge costs to the taxpayer.

But, also, many stories are told about public officials bending the rules and granting contracts to themselves, relatives and friends – also at huge cost to the taxpayer.

Vavi is also right in saying there is a culture of crass materialism that has pervaded the private and public sectors.

This is a society where there are massive inequalities.

What this scenario tells us is that the attainment of a democratic order in this country has created a situation in which there is class of people who are not necessarily entrepreneurs in the classical sense – but see public office as an opportunity to feed their materialistic hunger.

In his book Architects of Poverty Moeletsi Mbeki argues that the South African productive economy remains in the hands of an economic oligarchy that owns what he calls the Mineral- Energy Complex (MEC) – which includes the country’s financial and mining sectors.

Mbeki argues that it is this class who has set the living standard in the country. There is then the black elite, on the other hand, which is striving to live up to that standard.

The strategy that the black elite has embraced to achieve this has been black economic empowerment.

Some have achieved this by using political connections to acquire a stake in companies within the MEC.

Others have used their positions within the public sector to accumulate wealth by earning inflated salaries and being involved in corrupt business deals.

As Mbeki points out their approach is, therefore, not that of using the state to serve the needs of the people but rather of using it to advance their material interests.

What this tells us is that any solution to the problem of corruption and crass materialism must look at South Africa’s current developmental model and how it has perpetuated the scourge.

Failure to do so will reduce putting legislation and anti-corruption mechanism in place to mere band aid solutions.

http://www.sowetan.co.za/News/Article.aspx?id=1085001

2.2 Cosatu backs housing call

News24, 4 November 2009

Cosatu in the Northern Cape said on Wednesday it supported the demolition of poorly built low-cost government houses as suggested by Human Settlements Minister Tokyo Sexwale,

"It is indeed a shame and an insult to our people to allow them to stay in brick shacks under the guise of service delivery," the Congress of SA Trade Unions said in a statement.

"However we want to take the call further and call for a forensic investigation of all the shoddy projects in the province so that the culprits, both in construction and in government, are brought to book."

It said that for "every corrupt government official there is a corrupt businessman and vice versa" so both must be harshly dealt with.

People did not just want shelter, they wanted decent houses and badly built houses should be removed from the statistics of service delivery as they did not belong there.

Cope defectors

"In fact we need to have statistics of the low quality houses that they built for our people before they ran away to form [the Congress of the People]," it said, referring to an ANC breakaway group.

It said contractors should not be paid in full until projects were completed and thoroughly inspected.

Cosatu said it was during the term of former housing MEC Pakes Dikgetsi that the houses were built with below-standard bricks.

"When we made noise and raised concerns about the poor workmanship at that point, he was the one who jumped to the defence of those projects," Cosatu said of Dikgetsi who joined Cope in January.

Sexwale said on Tuesday that in the Northern and Eastern Cape alone 3 000 houses would have to be destroyed as a result of "shoddy" and corrupt workmanship.

Dikgetsi told OFM radio that this was due to poor monitoring. - SAPA

http://www.news24.com/Content/SouthAfrica/Politics/1057/50f47f098c78485c831a205ba127e84b/04-11-2009-05-16/Cosatu_backs_housing_call

2.3 Cosatu calls for abolition of inflation targets

Brendan Boyle, Sowetan, 5 November 2009

COSATU took its criticism of Finance Minister Pravin Gordhan’s first medium term economic policy statement to Parliament yesterday, pressing for the abolition of inflation targeting and for the SA Reserve Bank to drop its policy rate to 3percent.

The parliamentary liaison officer for the Congress of South Africa Trade Unions, Prakashnee Govender, told Parliament’s finance committee that Gordhan should also have intervened more dramatically to weaken the rand.

Speaking during the second week of public hearings on the Treasury’s three-year spending programme, which Gordhan tabled last Tuesday, she said the unqualified focus should be on the creation of decent, permanent jobs.

Govender did not say how the government should fund the plans that Cosatu put on the table.

“A weaker exchange rate is necessary to discourage imports and ease pressure on local producers,” she said.

Luxury imports should also be taxed more heavily to help drive down the deficit on the current account of the balance of payments, which economists see as the Achilles’ heel of South Africa’s economy.

“The government must reduce interest rates to ease credit market conditions, discourage speculation in the financial markets and enable fiscal policy to divert resources to social spending as opposed to servicing interest on public debt. Cosatu calls for an interest rate reduction to 3percent.”

In a generally more supportive submission to the committee, Business Unity South Africa (Busa) called for a radical overhaul of the management of state-owned enterprises.

“It is quite clear that the business model that has been applied so far to the parastatals is no longer operative. We need not only to look at the funding model in the short term, but how they are structured in the longer term,” said deputy director of the business lobby group, Raymond Parsons.

The committee will submit a report to Parliament on Gordhan’s proposals, but has no authority to change his allocation of funds.

http://www.sowetan.co.za/News/Article.aspx?id=1084971

2.4 Cosatu wants 3% in interest rate

Michael Hamlyn, Business Report, 4 November 2009

Cosatu told MPs on Wednesday that it wants to see the interest rate set by the Reserve Bank at 3%; the federation's officials also praised the Finance Minister, Pravin Gordhan, for his bold response to the economic crisis in setting the budget deficit as high as 7.6% of GDP this year.

Prakashnee Govender from Cosatu's Parliamentary office however told a joint meeting of Parliamentary finance committees studying the medium-term budget policy statement tabled last week by Gordhan that the unions noted that the deficit reduces year-by-year.

"We are concerned that the expansion actually starts to get more constrained in the medium term," she said. "We are concerned that this is going to be an inadequate and inappropriate response to the structural trends of poverty and inequality in the country."

The trade union group also called for a tax to be placed on non-essential consumption imports, which Govender said destroyed local jobs. It also expressed concern about the "business-friendly" proposals to reduce exchange controls.

A major Cosatu affiliate, the health workers' union Nehawu, endorsed the federation's call for the Treasury to insist on local procurement for purchases by national, provincial and local government.

Nehawu also backed Cosatu's call for more details on the National Health Insurance scheme, and wondered why there was very little provision to be seen in the medium term statement.

Although Cosatu praised the extension of the child support grant until 18, Govender said the unions wanted more clarity on what the rate of the grant would be in 2010, saying that the grant has not been inflation-proofed and is now worth much less than it was.

http://www.busrep.co.za/index.php?fArticleId=5231467&fSectionId=552&fSetId=662

3 South Africa

3.1 Numsa and ANCYL show Gwede the finger

Zukile Majova, Sowetan, 5 November 2009

A WAR of words has broken out in the ruling tripartite alliance, with the ANC Youth League and the National Union of Metalworkers

The ANCYL and Numsa dismissed ANC general secretary Gwede pressing on with their demand that President Jacob Zuma nationalise the country’s mines. Mantashe’s assertion that the ruling party had no policy to nationalise the mines.

Yesterday Julius Malema again warned that those opposed to nationalisation would not get support for ANC leadership positions come 2012, when the ruling party holds its next elective conference.

Speaking on SABC2, Malema accused Mantashe of “speaking English instead of politics” by insisting that nationalisation was not mentioned in the Freedom Charter.

ANCYL spokesperson Floyd Shivambu said the current laws failed to ensure that people shared in the country’s wealth.

The league is unhappy with the fact that while the state owns the mineral rights, it still grants mining licences to private companies.

Numsa spokesperson Castro Ngobese said: “Mantashe has a right to his views. What we want is the nationalisation of the high commanding heights of the economy – the mines, banks and land to be in the hands of the people.

“We at Numsa know that the Freedom Charter remains the key over-arching policy document for action by the ANC-led alliance.”

On Tuesday Mantashe warned the Gauteng Young Communist League, ANCYL and Numsa against the “loose reference” to the Freedom Charter in their demand for the nationalisation of mines.

“When people refer to the Freedom Charter, we want them to refer to it accurately because if you don’t, you can cause confusion,” he said.

“There is no decision of any congress of the ANC to nationalise the mines.”

Mantashe said the Minerals and Petroleum Resources Development Act had already “reverted the ownership of mineral deposits to the state”.

http://www.sowetan.co.za/News/Article.aspx?id=1085022

3.2 ANC, allies hatch new plan to curb Manuel’s authority

Karima Brown, Business Day, 5 November 2009

THE African National Congress (ANC) and its allies have proposed an alternative to the green paper on national strategic planning, in effect destroying the authority of Minister in the Presidency Trevor Manuel .

Weeks after a shuffle of roles in the Cabinet and Presidency, a new ANC document proposes a planning approach markedly different to that envisaged by Manuel.

The Congress of South African Trade Unions (Cosatu) has criticised Manuel for accumulating too much power in the national planning commission that was set out in his green paper.

In the new joint paper, a presidential planning commission (PPC) chaired by President Jacob Zuma or Deputy President Kgalema Motlanthe is proposed as opposed to a national planning commission headed by Manuel.

The document says presidential weight is needed behind the planning commission to allay fears that one cabinet minister would become more senior to others.

The document is to be discussed by the ANC’s national executive committee this weekend and at a meeting of the tripartite alliance next weekend at which it expects to iron out differences, especially on economic policy.

Besides changes in name and the chairing of the commission, there are critical differences between proposals made in Manuel’s green paper and in this document. They include:

n The PPC will be composed of chairs of cabinet clusters and ministers nominated by the president, instead of a group of 20 people from civil society as proposed by Manuel;

n Significantly, Economic Development Minister Ebrahim Patel, who does not chair his cluster, will still lead in making economic policy;

n The authors of the document spell out that Patel’s Department of Economic Development should be “built and resourced as a policy and planning oriented” rather than delivery department, leaving no doubt as to the pre-eminence of Patel’s role in the Cabinet and in planning;

n Policy making will remain a task of line function departments, and not be led by the national planning commission as touted by Manuel; and

n A presidential planning advisory group will be set up and

co-ordinated by the National Economic Development and Labour Council, which could meet twice a year to provide “specialist advice” and act as a “sounding board” for Zuma.

The involvement of civil society in the planning process has been a demand of Cosatu.

Alliance leaders are concerned that unless the green paper is refashioned to exclude the recommendation that “outsiders” sit on the planning commission, it could amount to “outsourcing” a key function of the developmental state.

The latest proposal — aimed at developing consensus among the allies — was drafted after a series of meetings, and included senior members of the South African Communist Party and Cosatu . ANC executive member Jeff Radebe is driving the process.

“Although the green paper does raise the relationship between policy and planning, it should be clear that the responsibility of the PPC is planning only,” the new proposal states.

A secretariat comprising a civil servant team of full-time and relatively “well-resourced” professionals should buttress the work of the PPC, the report says.

Manuel and Collins Chabane, minister in the Presidency responsible for monitoring and evaluation, would jointly oversee the work of the secretariat.

But the architects of the PPC cautioned against the commission usurping the policy-making role of the line function ministries.

The document says while Manuel’s green paper does address the relationship between the functions of the planning commission and planning, in the government, it does not give details on how the commission would relate to planning across the government or on the roles of other departments that have planning functions.

http://www.businessday.co.za/articles/Content.aspx?id=86067

3.3 The bogeyman of the leftward lurch

Jonathan Steele, Politicsweb, 4 November 2009

Jonathan Steele says there is a big hole in South Africa's economic debate

There is a big hole of Kimberley-size proportions in what passes for economic debate in South Africa. Out here for three weeks on vacation, and making a strenuous effort not to follow current events too closely, I started to get the feeling of a strange vacuum in the newspapers through which I occasionally leafed.

Where was the concept of "social democracy"? What made the political commentators and economic analysts I was reading unable or unwilling to mention the word "redistribution"? Why did no-one on the editorial pages show any awareness of the fact that modern capitalist economies can run efficiently on Keynesian lines and not just according to the neo-liberal methods that were instituted by Ronald Reagan and Margaret Thatcher way back in the 1980s?

In the United States and Europe a massive economic re-think has been underway for the last twelve months. Neo-liberalism is on the defensive, and rightly so. People realise that the current global recession was sparked by the neo-liberals' mistakes in de-regulating financial markets and encouraging bankers and pension fund managers to rush into short-term profit-making and a greedy bonus culture that led to pyramid schemes built up on shaky but impenetrable derivatives.

None of this shift in thinking seems to be reflected in South Africa. Political commentary is stuck in juvenile tram-lines and a repetitive cycle of speculative newspaper and magazine headlines which one day announce that the government may "lurch to the left" and the next day gleefully report that there will be no such lurch. At regular intervals readers are warned that Cosatu and the South African Communist Party are planning to force Jacob Zuma's government to adopt "socialist" policies.

Then comes the jubilant news that they will not succeed. Articles about Finance Minister Pravin Gordhan's briefing to the media shortly before making his interim budget statement concentrate on the inane issue of whether he was still a secret member of the SACP. The fact that the SACP long ago abandoned socialist policies and that for at least the last ten years Cosatu has not articulated a radical leftwing programme is ignored.

It is true that Cosatu bangs on about the need to tackle unemployment and improve service delivery as the government's top priorities. But these are goals. What about methods? What concrete programmes has Cosatu offered to reach these goals, other than those which the government is already following? It is also true that the ANC Youth League and its leader Julius Malema talk of nationalising South Africa's mines at some vague point in the future.

But has the ANCYL done any technical analysis or feasibility studies about which mines to start with, and what costs or benefits would flow from taking the mines under state control? Until it does, the talk of nationalisation is rhetoric and not worth taking seriously, especially as it comes from a man who lives a high life of flashy consumption that reflects nothing of the sacrifice and modesty which most South Africans have to put up with.

The sad fact is that, with very few exceptions, South Africa's mainstream commentators, editorialists, reporters, and headline-writers espouse rightwing pro-business views. Some have bought unthinkingly into the neo-liberals' Tina line - "There is no Alternative" - initially popularised by Thatcher. Others peddle it deliberately. The bogeyman of "leftward lurches", given flimsy substance by the ANCYL's mine-nationalisation waffle, is used deliberately to tell us that we must all knuckle under to neo-liberal economic management and the harsh reality that Tina is right.

What rubbish. The economic debate, now going on in Europe and the United States, is between centre-right and centre-left, between conservatism and social democracy. In order to extract the economy from recession should governments cut spending or raise it? How high can public sector debt be allowed to climb before the economy's re-expansion replenishes the Treasury's intake from taxes? In the short-term, given the mess into which bankers' greed has got almost every Western economy, why should their bonuses not to be capped? In a time of national austerity, shouldn't middle- and upper-income earners bear a greater share of the pain, in part through redistributive taxes?

South Africa's economy is not the same as those of the developed north. It is a hybrid of the First and Third Worlds. Even on a visit as short as three weeks the country's glaring inequalities stare one in the face. Nowhere else in the world are they so extreme. But that only heightens the urgency of getting a sensible debate going here. There is a whole host of policy options that deserve to be discussed, both within government as well as in parliament, the media, and civil society. Bury Tina. Cut the crap about "socialist threats", and start an adult dialogue on what policies are likely to work best.

Jonathan Steele is a commentator, writing mainly for the Guardian in London

http://www.politicsweb.co.za/politicsweb/view/politicsweb/en/page71619?oid=149739&sn=Detail

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