Dark clouds gather over jobs sum­mit

Ramaphosa has his work cut out to rally every­one be­hind his vi­sion and some are al­ready grum­bling

Mail & Guardian - - News - Di­neo Bendile

Labour fed­er­a­tion Cosatu has called for a re­view of the Na­tional Devel­op­ment Plan (NDP), which it be­lieves is bound to fall short of its devel­op­ment tar­gets. The pro­posal will be part of Cosatu’s con­tri­bu­tion to the pres­i­den­tial jobs sum­mit, which started in Midrand on Thurs­day, and is likely to place the fed­er­a­tion at odds with its so­cial part­ners, as well as Pres­i­dent Cyril Ramaphosa’s ad­min­is­tra­tion and or­gan­ised busi­ness.

Although Cosatu has long had is­sues with the NDP, par­tic­u­larly re­gard­ing the eco­nomic chap­ter, its fresh call for a pol­icy re­vi­sion has been prompted by the de­ci­sion of the Na­tional Plan­ning Com­mis­sion (NPC) to dras­ti­cally al­ter the NDP’s pro­jected 2030 unem­ploy­ment rate.

Ramaphosa was the deputy chair­per­son of the com­mis­sion un­der for­mer fi­nance min­is­ter Trevor Manuel.

The NDP, in its most op­ti­mistic fore­cast, had pro­jected an unem­ploy­ment rate of 6% by 2030, but the NPC has de­scribed this as out of reach and ad­justed it to 14%.

South Africa is only 12 years away from the NDP’s “vi­sion 2030” and, ac­cord­ing to Sta­tis­tics South Africa, has a 27% unem­ploy­ment rate.

Speak­ing to the Mail & Guardian this week, Cosatu gen­eral sec­re­tary Bheki Nt­shal­intshali said the mag­ni­tude of the unem­ploy­ment cri­sis had reached a point at which no pol­icy, in­clud­ing the NDP, could be viewed as “un­touch­able”.

“In our view, no­body can deny that the NDP is not go­ing to meet its tar­get. We don’t want to say ‘we told you so’ but, rather than putting on a pos­ture of blam­ing, we need to go back to the ta­ble and say what needs to be done,” he said. “And we can’t re­view only fig­ures. We must go to the foun­da­tion and say why are we not go­ing to meet what we thought was go­ing to work.”

But busi­ness has raised con­cerns about Cosatu’s ap­proach and has warned that global in­vestors and rat­ing agen­cies could read a tam­per­ing with poli­cies as pol­icy un­cer­tainty, which would af­fect the coun­try’s credit rat­ing.

This week the pres­i­den­tial jobs sum­mit launched its first phase, which is to iden­tify projects that could cre­ate jobs, co-or­di­nate where money should be chan­nelled to in­crease em­ploy­ment and as­sess why some poli­cies did not work.

The sum­mit comes two weeks af­ter Ramaphosa an­nounced a pack­age of eco­nomic re­forms and spend­ing in an ef­fort to boost a slug­gish econ­omy.

Cosatu’s NDP rec­om­men­da­tions are likely to be raised only in the se­cond phase of the sum­mit, which will prob­a­bly lead to open dis­cus­sions on pol­icy and more ro­bust ne­go­ti­a­tion among so­cial part­ners.

But Busi­ness Unity South Africa (Busa) chief ex­ec­u­tive Tanya Co­hen warned that the world was watch­ing South Africa and back­track­ing on pol­icy is­sues ran the risk of scar­ing away much-needed in­vest­ment.

“From a busi­ness per­spec­tive, our con­cern is that we don’t do things that are go­ing to plum­met our prospects of at­tract­ing in­vest­ment, re­main­ing com­pet­i­tive and mak­ing sure that we don’t get a rat­ings down­grade. That would be cat­a­strophic,” she said. “So things like fis­cal sta­bil­ity and not putting out mes­sag­ing that demon­strates that we are go­ing to go back­wards in terms of pol­icy sta­bil­ity, those things are im­por­tant. We’re be­ing watched.”

She said there needed to be a way of bal­anc­ing the short-term goal of cre­at­ing jobs with the long-term goal of en­sur­ing poli­cies and so­lu­tions that would de­liver sus­tained re­sults.

Strained re­la­tions be­tween the so­cial part­ners are also likely to put pres­sure on the rate of the sum­mit’s progress.

The pres­i­dent of the Black Busi­ness Coun­cil, Sandile Zungu, said busi­ness, labour and gov­ern­ment were stuck with a ma­jor trust deficit, which would have to be ad­dressed for the sum­mit to suc­ceed.

“I think there is a trust deficit among so­cial part­ners and this trust deficit is his­tor­i­cal and in­formed by events not only in our re­cent past but in our his­tory in gen­eral,” he said. “Busi­ness views gov­ern­ment with scep­ti­cism and gov­ern­ment views busi­ness with scep­ti­cism. It’s the same with labour and busi­ness. And [be­tween] labour and gov­ern­ment.”

Ramaphosa’s big­gest task at the sum­mit will be to unite every­one be­hind a com­mon goal, which will have to in­volve some com­pro­mises.

Zungu said he be­lieved Ramaphosa is the right per­son to thaw re­la­tions be­cause he is trusted by all three sec­tors.

But Cosatu has al­ready iden­ti­fied ar­eas it would not be will­ing to com­pro­mise on.

“The is­sue of wage de­mands: when 50% of the work­ing pop­u­la­tion is earn­ing be­low the poverty line, you can’t ask work­ers to com­pro­mise on cer­tain is­sues. It can’t work,” Nt­shal­intshali said. “Even if you say work­ers must com­pro­mise with re­gard to wages, where will that money go to? If it goes to share­hold­ers, it means you are just al­low­ing the com­pany to max­imise prof­its [in­stead of cre­at­ing jobs].”

Nt­shal­intshali also said Cosatu would forge ahead with its ef­forts to en­sure work­ers had a di­rect say in how their pen­sion funds were be­ing in­vested, es­pe­cially if that money could cre­ate jobs.

“For ex­am­ple, if we are talk­ing about de­vel­op­ing in­fra­struc­ture in schools and there is no money, should we take our money and just put it in banks? Or should we use it to say we will buy gov­ern­ment bonds and give a direc­tive to say the money we are putting in should only be utilised for in­fra­struc­ture in the pub­lic ser­vice and cre­ate jobs?” Nt­shal­intshali asked. “It is not ac­cept­able that we can just give money to those pri­vate sec­tor fund man­agers and say ‘in­vest our money, de­cide where to in­vest it’.”

He said busi­ness had to com­pro­mise, specif­i­cally on an “in­vest­ment strike”, if lo­cal busi­ness in­vested too lit­tle in the econ­omy and was in­dif­fer­ent to re­trench­ments.

Part of Cosatu’s de­mands has been that the pri­vate sec­tor and gov­ern­ment should halt all re­trench­ments.

At Cosatu’s na­tional congress last month, Ramaphosa told del­e­gates the gov­ern­ment would not be re­trench­ing pub­lic ser­vants.

Busa, in its re­sponse to Cosatu’s call for a mora­to­rium on re­trench­ments, said: “To be com­pet­i­tive, busi­nesses must be able to adapt and change to chang­ing cir­cum­stances and op­por­tu­ni­ties. Busi­ness ac­knowl­edges that, par­tic­u­larly in the cur­rent cli­mate, re­trench­ments must be a last re­sort.”

Cosatu has taken this as a re­fusal by busi­ness to halt any re­trench­ments that may ei­ther be planned or al­ready un­der way.

These thorny is­sues are only ex­pected to be ne­go­ti­ated once the sum­mit en­ters its se­cond phase.

So far there has been an agree­ment on the need to in­crease lo­cal pro­cure­ment and to mon­i­tor the pay dis­par­i­ties be­tween work­ers and ex­ec­u­tives in the pri­vate sec­tor.

Cosatu will also call for a re­view of the “ex­ces­sive” re­mu­ner­a­tion pack­ages given to Cab­i­net min­is­ters.

Speak­ing on the first day of the sum­mit, Ramaphosa said a frame­work had been adopted in the first phase of the sum­mit that saw a pledge from the fi­nan­cial sec­tor to in­vest R100-bil­lion over five years in black-owned in­dus­trial en­ter­prises. The frame­work also saw so­cial part­ners agree­ing to buy more lo­cal goods, to find strate­gies to re­tain ex­ist­ing jobs and to make fund­ing and sup­port avail­able to the ben­e­fi­cia­ries of land re­dis­tri­bu­tion.

Unattain­able: Cosatu’s gen­eral sec­re­tary Bheki Nt­shal­intshali (be­low) will ask for the Na­tional Devel­op­ment Plan to be re­viewed at Pres­i­dent Cyril Ramaphosa’s (top, mid­dle) jobs sum­mit. Pho­tos: David Har­ri­son & Del­wyn Verasamy

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