Youth wage: ‘guarantee needed’ for older staff

GOVERNMENT partnership with the private sector on the proposed youth wage subsidy needed to have guarantees that older workers would not be compromised, Gauteng Premier Nomvula Mokonyane said on Tuesday.

Her comments came a day after KwaZulu-Natal Premier Zweli Mkhize said the province wanted to implement the youth incentive scheme, suggesting a need for broader consensus within the government before the subsidy began.

Ms Mokonyane’s views suggest growing political will to speed up the implementation, with Economic Development Minister Ebrahim Patel saying on Monday that discussions on the issue at the National Economic Development and Labour Council (Nedlac) needed to be concluded.

The scheme aims to encourage businesses to employ young people. It is regarded as necessary to equip school leavers with skills and to address SA’s high youth unemployment rate.

Democratic Alliance (DA) Gauteng leader John Moodey challenged Ms Mokonyane to claim Gauteng’s share of the R5bn youth wage subsidy fund from the Treasury, saying the province was failing young unemployed people.

Ms Mokonyane said the government must create opportunities for youth employment but the private sector also had a key role to play. “Discussions over the youth wage subsidy should be taken back to Nedlac,” she said.

However, talks have consistently deadlocked at Nedlac, with the Congress of South African Trade Unions (Cosatu) opposing the proposed subsidy, arguing that employers would hire younger workers at a lower wage at the expense of older, more experienced employees.

As the African National Congress (ANC) and its alliance partners battle to find common ground, the DA has been pushing for the subsidy.

Earlier this month, the ANC Youth League described the subsidy as “cash cows for private companies”. “The commitment to job creation on the side of the private sector has always been little,” league spokeswoman Magdalene Moonsamy said yesterday. On Tuesday she said that the private sector was “the greatest creator of employment opportunity”.

Gauteng ANC chief whip Brian Hlongwa said the subsidy proposal originated from the ANC-led government, and not the DA. He said a concern was “to ensure that capital does not use this avenue to lay off those already in their employ”.

Mr Hlongwa said the interest of business was making a profit, and something needed to be done to mitigate the possibility of “organised capital” exploiting the scheme.