Labour Watch

ANC-COSATU alliance could sink labour indaba

Labour Minister Mildred Oliphant
Mildred-Oliphant.jpg

Despite Minister of Labour Mildred Oliphant stressing the importance of the National Economic Development and Labour Council (NEDLAC), its upcoming indaba runs the risk of being rendered irrelevant.

In a recent keynote address at the KwaZulu-Natal Economic Summit in Durban Minister Oliphant stressed the importance of NEDLAC as a forum for social dialogue and consensus. She also said government should stay out of labour matters that can best be addressed in such an institution.

In view of the upcoming national labour indaba to be hosted by NEDLAC, and in light of the ruling party’s continued alliance with labour, her remarks are particularly relevant.

On 4 November NEDLAC will host the long-awaited, and critically important, Labour Relations Indaba with Deputy President Cyril Ramaphosa as its convenor.

Oliphant’s remarks bring up two important issues at a time when economic growth, job creation and the eradication of poverty rely heavily on all sectors of society pulling together for the common good:

• The close alliance between government and labour that significantly curtails government’s effectiveness not only in governing effectively, but in the NEDLAC context also as an ‘honest broker’ and a supposedly non-aligned participant in the dialogue process; and

• The continued relevance of NEDLAC as South Africa’s premier institution for social dialogue on socioeconomic questions.

It is common cause that under the present tight economic conditions South Africa desperately needs investment and job growth to lift it onto a more positive trajectory.

One factor preventing this is the country’s volatile labour environment and its arguably failing labour relations system, worsened by depressed socioeconomic conditions in labour communities. The recent protracted platinum strike serves as a good example.

It is therefore critically important that the social partners should use the upcoming labour indaba to engage on:

• The impacts of existing labour legislation;

• The proliferation of unprotected and prolonged strikes;

• Exorbitant wage increase demands;

• The causes of strike-related violence; and


• The implementation of a national minimum wage, among other things.

All three of South Africa’s current main socioeconomic development plans – the National Development Plan (NDP), the New Growth Path (NGP) and the 2014-2017 Industrial Policy Action Plan – as well as the 2014-2019 Medium Term Strategic Framework (MTSF) aimed at facilitating accelerated economic transformation, economic growth and job creation, call for a social compact. A productive and stable labour environment would be a key component of this.

Recalling various successful historic examples, including South Africa’s constitutional negotiations, Minister Oliphant makes a strong case for social dialogue to resolve disputes, to achieve agreement and reach a social accord.

She points out that around the world governments, business and labour engage in problem-solving dialogue in forums like NEDLAC. In South Africa a fourth social partner, community organisations through SA National Civics Organisation (SANCO) (representing, women, youth and co-operatives) is included.

At the launch of NEDLAC in 1995 President Nelson Mandela said: “Democratisation must reach beyond the narrow governmental domain and NEDLAC represents the broadening and deepening of our democracy by directly engaging sectors of our society in formulating policies and in managing institutions governing their lives.”

NEDLAC’s relevance

Is NEDLAC still relevant and performing this role? Is it the appropriate institution for this dialogue, bearing in mind, as Oliphant pointed out, that dialogue is not an event but an ongoing process?

Minister Oliphant seems to think so. Despite the reservations of others, she maintains that “using the NEDLAC platform to engage on policy matters and other pressing socio economic challenges, is vital”. She also affirmed that “institutionalised social dialogue under the auspices of NEDLAC remains an important and indispensable tool for transparency and participation in policy formulation”.

Others disagree and increasingly question NEDLAC’s continued relevance. Other than government, other parties mostly failed to table policy proposals. A number of new entities representing various interest groups are not directly represented in NEDLAC and refer to engage government directly. Again the platinum strike was a good example.

Conditions at the time and the raison d’être for creating NEDLAC changed dramatically over the years. Many argue that NEDLAC has not kept pace with the changes.

Some role players from both labour and business believe, rightly or wrongly, that NEDLAC failed to facilitate consensus on critical policy issues. A general complaint is that government does not take NEDLAC seriously, either using it as a mere rubber stamp or bypassing it, depending on the issue. Some propose a review of NEDLAC’s mandate and role. Others among the social partners no longer see any value in participating in NEDLAC, thus undermining it.

The envisaged complementary role of NEDLAC in relation to parliament in the legislative process has not fully materialised either.

Exacerbating the situation is fragmentation of the different social sectors. On the labour front it exists not only between various federations and associations, like the Congress of SA Trade Unions (COSATU) and the Association of Mineworkers and Construction Union (AMCU), but also within COSATU.

Business, too, is fragmented, with different organisations claiming leadership. And these last few years increased power, factional and ideological struggles among competing interests in the ANC-led governing alliance have affected the government sector.

Much of this has led to the belief that the social partners are so far apart and so ideologically driven that consensus on anything is near impossible. Thus, at a time when the country perhaps needs it more than ever before, prevailing conditions militate against meaningful social dialogue, partnerships and a social compact.

The sudden resignation of NEDLAC’s executive director, Alistair Smith, one year ahead of completing his four-year term, has in recent weeks put these issues under the spotlight.

And, while Oliphant and others acknowledge this criticism of NEDLAC and social dialogue, there is one aspect that has not been dealt with: the at times dualistic relationship between labour and government.

Oliphant warned that government getting involved in “industrial relations operational matters” is undesirable and that policy issues should be left to negotiations in institutions like NEDLAC.

However, she failed to acknowledge the fact that COSATU, as the biggest labour federation in the country and a governing alliance partner, helps shape policy – yet it also reserves the right to hold the government and the economy to ransom via labour-related demands and industrial action.

Ideally the social partners should participate in social forums as equal but independent participants. Where one party is overpowered by an alliance of the others, or where one party ignores the others and uses the forum as a rubber stamp, the dialogue becomes meaningless and genuine agreement impossible.

In the case of NEDLAC a general perception exists of a division with business on one side, and the government, labour and communities (represented by SANCO) on the other.

On top of this, embedded into the governing alliance as a ‘hidden player’, is the SA Communist Party (SACP). While part of the business sector, it may also at times view itself more aligned with the governing alliance than with business.

This leaves the business sector at a distinct disadvantage. It also raises the spectre of NEDLAC being required to simply rubber stamp government and/or Alliance policy and decisions. And when government cannot get its way it simply bypasses NEDLAC, as it did with the Employment Tax Incentive Scheme or the youth wage subsidy.

NEDLAC also largely deals with labour market issues, while other forums and bodies deal with other parts of the overall social dialogue agenda in a fragmented fashion.

Perhaps what is really needed at this critical juncture in South Africa, given the ANC’s demand for “radical economic transformation” is a new economic CODESA, bringing all parties and issues together in a single debate-seeking national compact.

by Stef Terblanche

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