Cosatu singing its old tune of opening workers’ bank
Federation to apply for licence
In a move that seeks to shake up existing ownership patterns in the financial sector, trade union federation Cosatu has resuscitated its old resolution to establish a workers’ bank.
This is to ensure workers have access to credit facilities which they often do not qualify for at the country’s four major banks.
Several studies by the Public Service Commission have found that the majority of the country’s public servants, who are mostly Cosatu members, are over-indebted and are not eligible for home loans.
Yesterday, the federation announced that its central executive committee meeting that sat this week decided it should undertake research projects to explore the workers’ bank model. “This is our old resolution that is very necessary now that we are faced with an economic crisis,” said Cosatu general secretary Bheki Ntshalintshali.
“Workers have no say in how the current commercial banks should benefit society.”
The decision to form a workers’ bank stems from a 2009 Cosatu national congress which resolved to put in place a process that will result in the establishment of a workers’ bank.
Although at the time, UBank, formerly Teba bank, was identified as the ideal vehicle for the implementation of the resolution, the plan fell flat as Cosatu affiliates jostled for equitable shares in the entity.
The bank, which operates in mining areas mainly, was formed in the 1970s to assist miners who were mostly migrant labourers to send money back home.
The current push for the establishment of the workers’ bank comes in the wake of the collapse of VBS which was pillaged to the ground by some of its investors, politicians and government officials.
The liquidated VBS mutual bank is one of the country’s long-standing black financial institutions in a sector that is predomin antly white-owned.
Cosatu leaders said its affiliates, who own billion-rand investment companies, would explore using union funds to raise capital for the venture.
The organisation’s first deputy president, Mike Shingange, said they would also begin the licence application process.
“We have seen people who are on the opposite of our class content accessing banking licences. We resolved to pull together and use the power that we have.”
Other trade unions and federations would be invited to be part of the venture, he added.
We resolved to pull together and use the power we have