Mining is urged to set up social grants fund

THE BENCH Marks Foundation, a non-profit faith-based organisation owned by South Africa’s churches, has urged mining companies to consider setting up a fund that would give social grants to retrenched mineworkers.

Bench Marks non-executive director John Capel said yesterday that mining companies had a social responsibility to their employees as 70 000 jobs had been lost between 2012 and 2016, with mines going bust amid a steep increase in input costs.

Capel said he wanted to know why during the good times the mining industry had failed to set up a fund that would help buffer the impact for bad times.

He said mining companies should be offering some kind of social income grant to the people that were going to be retrenched.

“They have a responsibility to do that, it goes beyond a severance pay,” said Capel, adding that the mines had a responsibility to protect communities.

“After all, they (the mines) took land, removed people from their subsistence economic activities, and they also poisoned water in many cases. They cannot make a big mess and say we are leaving, that kind of attitude goes back historically in the industry. Would they do that in Australia? I doubt that.”

The foundation’s call comes as the struggling industry continues to close mines resulting in a tsunami of job losses. Last month, AngloGold Ashanti, the world’s third biggest gold company, said it would shed 8 500 jobs.

Bokoni Platinum, a joint venture between Anglo Platinum, the world’s biggest platinum producer, and Atlatsa Resources, also gave notice of its plan to retrench 2 651 workers, excluding contractors.

Capel said that the retrenchments went to the heart of industry. “For example, many years ago Anglo American came to us telling us how many jobs they are creating, and telling us that this was their social responsibility. Now they are retrenching employees, closing some mines, and putting other mines in care and maintenance,” he said.

A Chamber of Mines spokesperson said in fact mines certainly sought to use the benefits of good years to sustain them through periods such as the industry has been experiencing in recent years.

“That is how many have sustained themselves through years of loss making and poor or zero dividend returns to shareholders. But this cannot be sustained forever,” he said.

AngloGold Ashanti said on Tuesday that it had recorded an impairment of certain of its South African assets amounting to $86 million (R1.14 billion) or 21 cents per share.

The chamber also said that between 2014 and 2016, the industry made an accumulative net loss of around R50bn.

“Increasing cost pressures such as the steep increase in the price of electricity, increased labour costs and the increased cost of materials such as steel, combined with the continued decline in productivity for various reasons, including the inappropriate application of Section 54 stoppages have served to undermine the sector,” it said.