Wage deal is a sell­out to poverty

CityPress - - Business - Pa­trick Craven busi­ness@city­press.co.za

When labour fed­er­a­tion Cosatu de­layed sign­ing the R20-an-hour min­i­mum wage agree­ment, an edi­to­rial in a lo­cal news­pa­per said: “There was some­thing ironic about this week’s sign­ing by all the so­cial part­ners – ex­cept Cosatu ... It was, af­ter all, Cosatu which had long pushed for a na­tional min­i­mum wage (NMW), moot­ing it for the first time ahead of its 2012 na­tional con­fer­ence.”

For many work­ers, what was more than just “ironic” is how on earth Cosatu – along with labour fed­er­a­tions Nactu and Fe­dusa – could ever have agreed to sign a deal which would le­git­imise pay­ing poverty wages to mil­lions of work­ers.

That was not the liv­ing wage that Cosatu del­e­gates voted for in 2012, and cer­tainly not what work­ers to­day are de­mand­ing.

South Africa’s big­gest union, the Na­tional Union of Minework­ers (NUM), has reg­is­tered its “dis­gust at the pro­posed amount of R3 500 per month, [which] re­in­forces South Africa as a haven for cheap labour, just as it was un­der apartheid”.

Pay of R3 500 a month is nowhere close to a liv­ing wage. Econ­o­mists have cal­cu­lated that South Africa’s “work­ing-poor line” is R4 125 a month, and that 54% of full-time em­ploy­ees – 5.5 mil­lion work­ers – earn be­low that.

So, this wage deal, con­cluded by Ned­lac – the con­sen­sus-seek­ing body com­pris­ing gov­ern­ment, busi­ness, labour and civil so­ci­ety – con­demns mil­lions of work­ers to live be­low the poverty line.

Even worse, it is be­ing sug­gested that the fi­nal leg­is­la­tion could in­clude “ex­emp­tions” which would al­low em­ploy­ers to pay even lower wages to cer­tain work­ers.

Deputy Min­is­ter of Pub­lic Works Jeremy Cronin said the gov­ern­ment’s po­si­tion was that par­tic­i­pants in its Ex­panded Pub­lic Works Pro­gramme should be ex­cluded. “At present, they are paid R83 a day. If we in­crease that to R20 an hour, 310 000 will be out of work op­por­tu­ni­ties in a year.”

Thus, the first deputy gen­eral sec­re­tary of the SA Com­mu­nist Party con­demns a third of a mil­lion young, su­per­ex­ploited South Africans to dire poverty, do­ing jobs which should be done by paid em­ploy­ees.

Ann Bern­stein, head of the Cen­tre for De­vel­op­ment and En­ter­prise, even com­plains that these pro­posed min­i­mum wages are too high, us­ing a spu­ri­ous cap­i­tal­ist ar­gu­ment: “The bal­ance of risk is that an NMW would in­crease rather than di­min­ish our ex­cep­tion­ally high lev­els of poverty and in­equal­ity through job de­struc­tion in the short term and re­duced labour ab­sorp­tion over the long term.”

She was partly an­swered by Im­raan Valo­dia, chair­per­son of the NMW ad­vi­sory panel, who said she was bas­ing her ar­gu­ment on a false view that mar­ket forces dic­tate the price of labour, and that – like any other com­mod­ity – it is ruled by laws of sup­ply and de­mand, and that if the price (wages) is too high, firms will not em­ploy work­ers.

Valo­dia cor­rectly dis­misses her idea that “labour mar­kets op­er­ate just like a mar­ket for to­ma­toes”.

He said: “Un­like a seller in a to­mato mar­ket, who is eas­ily able to go to an­other buyer if the price of­fered is too low, a rel­a­tively skilled un­em­ployed worker has very lit­tle op­tion (ex­cept per­haps to starve) but to take em­ploy­ment that is of­fered, how­ever low the wage.”

But what Bern­stein and Valo­dia are missing is the fun­da­men­tal dif­fer­ence be­tween a worker and a to­mato: It is the work­ers’ labour that cre­ates wealth and gen­er­ates their em­ploy­ers’ prof­its; a to­mato only ac­quires value be­cause work­ers plough the field, plant the seeds, har­vest the fruit, trans­port it to the mar­kets and sell it.

At ev­ery stage in the process, value is added by the worker who sells his or her labour, but re­ceives only a frac­tion of that value in wages. The sur­plus value goes to the em­ployer as profit. So, the de­mand for a liv­ing min­i­mum wage, like the R12 500 de­manded by the As­so­ci­a­tion of Minework­ers and Con­struc­tion Union in 2012, and now by the Na­tional Union of Me­tal­work­ers of SA, is not a plea for char­ity but for work­ers to get back a big­ger share of the wealth their labour cre­ates.

If fur­ther proof were needed of why we need the new work­ers’ fed­er­a­tion – to be launched in March – it is this bat­tle for a ba­sic liv­ing wage.

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