Address by FEDUSA General Secretary at the National Union Leather and Allied Workers National Congress Port Elizabeth 21 September 2013 Social Dialogue for Economic Development and Decent Work President Fortune Bhondoza Vice-President Peter Lottering General Secretary Ashley Benjamin Members of the National Executive Committee Delegates and Staff of NULAW Comrades and Friends Ladies and Gentlemen On behalf of our FEDUSA President Comrade Koos Bezuidenhout and our entire National Executive Committee, we would like to thank you for the invitation to address the National Congress of NULAW in the beautiful windy city of Port Elizabeth. We think that your theme for this congress Social Dialogue for Economic Development and Decent Work is appropriate for the challenges that leather workers face at this current juncture. The FEDUSA leadership is also grateful that you have released your General Secretary Ashley Benjamin to serve as Vice-President of our beloved Federation. Comrade Ashley is a great team player as he brings with him years of experience of international trade, he is also a formidable walking-encyclopaedia of industrial policy and he never neglects to attend a NEDLAC Trade and Industry Chamber meeting, where he serves as FEDUSA’s chief negotiator. We are also pleased to announce that NULAW is always in good standing with their monthly affiliation fees with FEDUSA. NULAW is also not a trade union that issues irrelevant media statements; Ashley always reminds us that workers are not interested in mindless media statements that do not advance the circumstances of working people in our country. He told us that the media will use you one-day and dump you the next-day, we have witnessed this in recent times. Chairperson This National Congress takes place against the background of severe tension and turmoil in the global and local economy. Wages of workers have remained flat for the past decade and salary increases over the last few years was just marginally above inflation. We witnessed the depression phenomena of 70 per cent youth unemployment. We also see that abusive and fraudulently issued garnishee orders and other deductions erode the disposable income of workers, while food, transport, medical expenses and electricity prices have increased at a rate double that of inflation. We feel that your Committee selected the appropriate theme for your National Congress: Social Dialogue for Economic Development and Decent Work. Please allow me to deal with two matters that are critical for workers in society, before returning to addressing the theme. The one is unsecured lending and the other is undisclosed and unregulated private funding to political parties. Chairperson The National Credit Regulator research indicate that interest accounts for 68% of the cost of credit, as the financial sector makes billions of rand through unsecured lending. The research conducted by the National Credit Regulator stipulated that the unsecured lending in this country has grown fourfold from R7 billion to R29 billion rand. The South African Reserve Bank’s Financial Stability Report in March this year shows that the exposure of the banking sector rose to R441 billion rand in the fourth quarter of 2012, from R398 billion in the previous quarter. The garnishee orders are issued by magistrate courts and compel employers to make deductions from their workers salaries to offset the debts. FEDUSA raised this issue with government recently and discovered in same cases that clerks of the court stamp the fraudulent garnishee orders, instead of magistrates; sometimes the magistrate courts are not in the same jurisdiction where the employer is based. A further concern is the lack of transparency of attorney fees and inadequate affordability test are applied on workers. FEDUSA warned government to stop the unsecured lending as it has already spilled in the collective bargaining arena recently. Minister Trevor Manuel blamed unsecured lending as an important factor responsible for the unprecedented wage demands of 60 to 100 per cent by certain trade unions. Workers are exploited by the financial sector, which including the insurance companies, banks, microlenders and attorneys for the current crisis. The global financial crisis has demonstrated to us that government will not regulate the unsecured lending, as the elections are just around the corner. The financial sector is known for their huge undisclosed donations to political parties. Chairperson Talking about undisclosed donations and other funds to political parties is a matter that is important for this National Congress to consider, as the vote of each worker is critical to shape the future of our democracy. The Public Funding of Represented Political Parties Act prescribe that political parties represented in parliament will receive funds from the national budget according to their representation in the National Assembly and Provincial Legislatures. Unfortunately the Act does not make provision for disclosure of private donations. The Institute for Democracy in South Africa (IDASA) challenged the practice of private funding of political parties in the Cape High Court in 2004 against the four main political parties, namely the ANC, DA, IFP and ACDP. It was strange that all these political parties strongly oppose the motion in the High Court out of fear that the private financial donors would not be prepared to guarantee further financial support to these parties should these donations be public. It is strange to FEDUSA, because political parties should be accountable and transparent to you, the public. The case was suspended after the parties agreed to legislate on the matter rather than to force the judiciary to rule on the matter. To date, no legislation regulating private funding of political parties has been presented or passed by the National Assembly. FEDUSA is of the view that IDASA was naïve to trust these political parties. This matter is a real danger to our democracy and FEDUSA Congress have adopted a resolution that require the Federation to remain politically non-aligned to any political party and required us to defend our democracy at all cost. The question remains, what are we going to do about this matter to ensure the interest of the rich and the new elite does not supersede the interest of the workers in this country. World-renowned political scientist, Lodge and Scheideggar argued that sources of funding for political parties have become a subject of increasing concern. Another academic, Khabele Matlosa explained the unease of this matter around this type of private funding is simply: 1. Private donations often come with strings attached; 2. Private donations are never ever disclosed publicly; and 3. Private donations are not regulated the same way as public funding. It is also important to recognise the greatest danger for South Africa’s young democracy is the corrupting tendency of undisclosed private funding not only to the management of political parties and their affairs but also even to the overall governance project of the country. It is FEDUSA’s view that it is important that some form of regulation of private funding in South Africa is institutionalised immediately to prevent the erosion of our young fragile democracy. Chairperson Decent work and economic development are two sides of the same coin for FEDUSA. Governments, employers and organised labour have jointly crafted the ILO definition of the decent work agenda in terms of the following four strategic objectives: 1. Employment and income opportunities; 2. Fundamental principles and rights at work and international labour standards (essentially organisational rights and freedom from coercion and discrimination); 3. Social protection (which include decent working conditions) and social security; and 4. Social dialogue and tripartism. FEDUSA shares the perspectives that social dialogue is an important and central instrument for workers and trade unions to use where the interests of different segments of society do not correspond. It is generally accepted that people affected by decisions should be able to express their needs, participate in decision-making processes and influence the final decisions so that a proper balance of interests is struck by government, organised labour and business in structure such at NEDLAC and bargaining councils. This is what NULAW do when you conclude agreements with employers in your bargaining council. This basic social principle applies both to the broad political institutions of democracy and to the world of work. Social dialogue is the term that describes the involvement of workers, employers and governments in decision-making on society, socioeconomic, employment and workplace issues. It includes all types of negotiation, consultation and exchange of information among representatives of these groups on common interests in economic, labour and social policy. Social dialogue is both a means to achieve social and economic progress and an objective in itself, as it gives people a voice and stake in their societies and workplaces. Social dialogue can be bipartite, between workers and employers or tripartite, including government. Bipartite social dialogue may take the form of collective bargaining or other forms of negotiation, cooperation and dispute prevention and resolution. Tripartite social dialogue brings together workers, employers and government to discuss public policies, laws and other decision-making that affect the workplace or interests of workers and employers. FEDUSA is concern about the latest tendency by government officials in NEDLAC, who try to push important national policy proposals throw without allowing the social partners the fair opportunity to properly consultant with our Affiliates and to receive a clear mandate. FEDUSA is also concerned that employers provoke workers into embarking on industrial action by offering low counter offers when wage demands are tabled. The leaders of government, business and organised labour agreed to strengthen collective bargaining by proposing innovative ideas to reinforcing it with action research. Our proposals include requesting bargaining councils to conduct independent research on the profitability of companies in a specific sector, as well as the socioeconomic conditions of workers relating to their transport cost, expenses for housing and study bursaries for the children of workers. Such an independent research report will then serve as the basis for determining mandates for employers and workers. I must say that we are very disappointed that the Department of Labour and our bargaining councils did not implement these innovative proposals. Chairperson Joseph Stiglitz argues that nothing affects the well being of people more than the state of the macro-economy, whether full employment and higher economic growth and development. When macroeconomic policies fail, unemployment will increase and those at the bottom are among those that will suffer the most, as is the case in our country and in some other countries. The politically connected, the financial sector and the elite benefit the most from our political and economic freedom, as you can see for yourself. The number of unemployed people grew from 1.9 million in 1994 to over 4.2 million in 2012 according to the strict definition that includes the number of people seeking work and women from rural areas. Young people between the ages 16 to 34 years making up more than 70% of the unemployed at the end of 2012. More women than men are without work and a larger proportion of Africans and Coloureds than Whites and Indians. Government tried hard through the various public employment schemes such as the Expanded Public Works Programme and Community Works Programme to creating work opportunities to provide income support for many unemployed people. FEDUSA supports the goal of government to create 4.5 million work opportunities by 2014 to provide support through short-term employment and to give income relief because it is in alignment with the strategic objective one of the decent work agenda. It is important to clarify work and income opportunity, it means that an individual could be employed on different projects and each period would count as a work and income opportunity. For example one person could be employed for 230 paid days per year. The person could even receive a payment while on training. Furthermore, FEDUSA also supports the Community Work Programme to create 332 500 work and income opportunities by 2014. In this, project an unemployed individual could work for any period and could also be employed on other projects. It is however important that we stimulate employment creation in the private sector through the implementation of the National Development Plan and the New Growth Path. Both these programmes specifically focus on the jobs drivers in the infrastructure, the agriculture value chain, the mining value chain, the green economy, manufacturing sectors, tourism and certain high-level services which is labour intensive. We also support job creation in the sub-sectors like the tannery, leather and bags as some of these firms are based in rural areas and it also very labour intensive. Approximately 9.5 million people were employed in 1995 and at the end of 2012 this amount increased to 13 523 million people according to Statistics South Africa. These statistics tells us an important story with regard to the economy, it says that the economy has created employment but is not able to absorb unskilled young people because of the skills mismatch. The skills mismatch means that there is employment but the unemployed does not have the necessary skills. This challenge should be addressed first through a person completing your national matric certificate with the appropriate subjects for the career path. Lets say you would like to be a pilot for an airline company, then you need a national certificate with mathematics, physical science, English, elective subjects could be mechanics and electronics. Physical science will teach you then the principles of aerodynamics and aeronautical with regard to motion and why the plane stay in the sky. It is important to achieve excellent results in these subjects in Grade 12 to be accepted at a pilot training school. The starting wage for pilot is about R160 000 per year, however when you proceed to become a captain then the salaries increase to about R360 000 per year. A captain that flies international could earn about R3 million rand per year. It is critical to understand that skills development takes time and requires hard work and the support of the parents and career specialist. In South Africa the Transport Seta is the place to start. As the economy growths new challenges and skills would be required to find decent employment but quality education is critical. The South African economy has been controlled by high levels of private sector concentration, collusion, market sharing and all these type of anti-competitive conduct. Our competition laws is based on the Constitution which seeks to advance the greater spread of economic ownership, a more efficient and effective economy, consumer access to quality goods and services and a restraint of trade practices which undermine a competitive economy. These anti-competitive behaviours by companies seriously harm further investment in the economy; lowers output and are detrimental to employment creation. FEDUSA is deeply saddened by the behaviour of some companies with regard to their anti-competitive behaviour. The list of companies found guilty of anti-competitive behaviour is very long, for example fifteen construction companies have agreed to pay a fine of R1.46 billion, Foodcorp settled to R88.5 million for two separate cartel cases, SAA and Singapore Airlines agreed to pay R18 million and R25 million respectively, Shell South Africa agreed to pay an R26.2 million administrative penalty and Apollo Tyres (formerly Dunlop) agreed to R45 million for price fixing. It is totally unacceptable for these companies to rob the economy and our people in this manner, but as the saying goes – CEOs, the rich and politicians does not go to jail, they only pay a fine, jails are for the poor and working people. Chairperson The next question is the issue of executives high pay packages. Let me use the example of Shoprite Checkers, the CEO Mr. Whitey Basson was paid R36.5 million per year according to the South African Labour News. He was paid R32.1 million and R4.4 million in benefits, this is a 10 per cent increase over 2010, if the R594.5 million worth of share options exercised that is excluded. Five years ago Mr. Basson earned an annual salary of R59 million, on top of that according to Moneyweb, the CEO received 10 million shares at a price of 651 cent, compare with the share value at the time of R62. Transnet’s former acting CEO Chris Wells was the highest paid director of a parastatal with R10.68 million package, the ABSA CEO Maria Ramos was paid R6.5 million, as well as a directors fee of R38 000 and a performance bonus of R4.55 million, bringing her annual pay to R11.1 million package. The CEO of FirstRand Sizwe Nxasana earned a package of R12.3 million. The Standard bank former CEO was the only executive known to have taken a voluntary pay cut to help the poor. He announced that he would give 10 per cent of his income to help needy pupils to get a quality education. The Minister of Finance issued a statement calling on businesses to rethink executive salaries and fat bonuses because of the economic crisis, glaring pay gaps and high unemployment. It is also essential to look at the huge difference between the salaries of public servants sitting in Parliament as MPs and those of educators, health and police officers. Matric teachers have to complete a four year degree and make about R250 000 per year, while Members of Parliament as public servants receive a package of more than R900 000 per year excluding Subsistence and Travel Allowances better known as S&T, numerous flights, pension, medical aid and virtually free accommodation in Cape Town when Parliament is in session. Chairperson FEDUSA plays a critical role in SADC through our affiliation with the Southern African Trade Union Co-ordination Council (SATUCC) to advance decent work for all, to support the aspirations of the people of Southern Africa to have economic, social and political freedom. It gives me great pleasure to announce to you that our FEDUSA Deputy President Comrade Godfrey Selematsela was elected as the Vice-President of SATUCC. The SATUCC delegates coming from Botswana, Lesotho, Malawi, Mauritius, Namibia, Mozambique, Swaziland, Tanzania, Angola, Zambia, Zimbabwe and South Africa adopted the strategic plan on political, economic, social and organisational issues. The delegates also agreed to stage the next SATUCC Council meeting in Zimbabwe in August 2014. This is to coincide with the SADC Heads of State Summit in order to engage these leaders and to embark on major protest actions across SADC. SATUCC must press ahead to free our region of dictators and advance regional political campaigns with a specific focus on Zimbabwe and Swaziland. Chairperson In conclusion, our President Comrade Koos Bezuidenhout was recently invited by our Brazilian trade union friends to attend their Congress that was held in Sao Paulo. It is important to realise that these strategic partnerships gives FEDUSA an opportunity to learn valuable lessons from our labour colleagues on how to deal with poverty, inequality and unemployment. Brazil and South Africa are very similar in terms of history and culture; it is only the language that is a challenge. Former President Lulu Da Silva was a worker who had a deep passion to do something about the fact that Brazil is a rich country, but was identified as one of the most unequal country’s in the world with huge unemployment and poverty. Within ten years, Brazil under President Lula Da Silva manage to assist 36 million people out of extreme poverty, the economy created 20 million jobs and made it possible for 40 million people to be raise into the middle class. Brazil moved up from being number 10 in the world according size of their economy to number 6 and electricity was provided to 14 million people in the farthest reaches of Amazon. President Lula established the economic and social development council composed of business owners, bankers, trade unionists, indigenous people, evangelical ministers and Catholics. The council created the greatest credit policy in the history of Brazil for retired workers and working citizens that were unable to acquire credit form banks. The agricultural sector also received support for family farms; credit was making it possible for people to have access to money with lower interest rates and more time to pay off loans. Former President Da Silva argued that Brazil build more universities and technical schools in 10 years than that were built in the last 100 years. On top of that in the past 10 years salaries of workers increased every year, and the minimum wage has increased every year. It is our view, if Brazil can do it why can’t South Africa do the same. I thank you and hope this congress will make meaningful change in our country. VIVA NULAW, VIVA! VIVA FEDUSA, VIVA!
Posted on: Sat, 21 Sep 2013 11:31:15 +0000
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