NUMSA and United Front Joint Memorandum on the Eskom tariff increase
30 November 2017
The National Union of Metal Workers (NUMSA) and the UNITED FRONT (UF) are extremely dismayed by the opportunistic call made by the Eskom board and its management to increase the electricity tariff by 19.9%. We view this demand by Eskom as nothing more than a gross abuse of power, and an attempt by the State Owned Entity (SOE) to hold the entire country and the economy hostage. This is being done by an entity which has been moving from one scandal to another with absolutely no leadership. In fact, it is extremely shocking that in a period of just two years, Eskom has changed CEO’s three times, and its CFO, Anoj Singh, has been suspended under a cloud of corruption and mismanagement allegations. But the same company and its board have the audacity to make an outrageous demand for a 19.9% tariff increase. They have no regard for the catastrophic implications which will trigger a national crisis of plant closures of small, medium and large companies; as well as causing retrenchments in all big companies. It will in fact destroy all opportunities to stimulate real economic growth and jobs.
NUMSA and the UF are of the view that the economy has been in a technical recession for several months which means the working class of this country are facing a job-loss blood bath across all sectors. Currently more than 36% of the working population is unemployed, and the numbers are increasing. More than 30.4 million of the population lives in abject poverty; the average worker supports at least 5 dependents on his/her meagre income, and at least 26 million South Africans go to bed hungry. Any change in the price of electricity will compound all these problems and increase the chances of a violent explosion in the country.
It is against this backdrop that NUMSA and the United Front reject Eskom’s outrageous demand for a 19.9% tariff increase. The Eskom board are clearly completely deaf and blind to the suffering of the working class because they decided to make this proposal in spite of the fact that there is glaring evidence that the working class majority simply cannot afford an increase in the electricity rate. The United Front and NUMSA have decided to hold this demonstration to express our anger with Eskom for wanting to increase the suffering of the working class, by requesting a tariff increase.
These are our demands:
1. We demand free electricity for the working class and the poor, and affordably priced electricity for industry.
We reject Eskom’s request for a 19.9% tariff increase. For the working class, access to electricity, like water, must be a human right and therefore we demand free electricity for the working class and the poor, and affordably priced electricity for the industry. The working class majority and the poor cannot afford to pay and the state should not commodify a basic human necessity like electricity. The only way to improve the basic living conditions and quality of life of the African working class majority who are still trapped in mass poverty, unemployment and inequality, is to ensure that every working class household has access to safe, clean free electricity. We demand that Eskom must change its mandate from profit seeking to ensuring that South Africa is adequately electrified both for domestic and industrial life
2. We reject state capture and corruption at Eskom
The ‘state capture’ report showed that Eskom has been used as a conduit for the enrichment of the Guptas and other crony capitalists connected to President Jacob Zuma and top ANC leaders. In other words, Eskom abuses the revenue it receives from consumers and taxpayers to benefit sections of the political and economic elite. ‘State capture’ has occurred through not only the likes of the Guptas and corrupt cadres, or the likes of the white old guard Ruperts, but even more so by the international financiers and their economic police – the credit rating agencies. Corruption is not just a problem within the public service, or confined to a small circle of political leaders and a few ‘rogue’ capitalists like the Gupta family. In the public sector it is invariably a result of collusion between public officials and companies in the private sector, which are just as steeped in corrupt and illegal practices. We reject corruption and state capture in all its forms. We believe that paying more for electricity means endorsing this blatant looting of the country’s resources. Clearly the participation of private companies such as KPMG, Mackenzie, and Trillian in this looting is a clear demonstration that capitalism is corrupt, it is a system that breeds corruption and that is why we reject capitalism as inherently, the future is Socialism.
3. Labour brokering
NUMSA calls on Eskom to ban labour brokers. All employees on contract should be permanently absorbed into the workforce with benefits. NUMSA won a Labour Appeals Court decision which confirmed that temporary workers automatically become the full time employees of the main employer, if their work continues beyond the three month period. Therefore Eskom has no choice but to permanently employ all temporary workers who have been on their books for more than three months.
4. End the Apartheid wage gap in the workplace
The wage gap between African employees at Eskom and their white counterparts has been, and continues to be extremely wide. It is unfair that in the last 23 years, Eskom as a state owned entity has failed to deal with the legacy of the Apartheid wage gap, where white workers are paid more and have more benefits than African workers who do the same work. African women suffer the most under this oppressive system. NUMSA condemns Eskom for dragging its feet on transformation and for re-enforcing racial inequality. We demand that this imbalance is immediately corrected.
5. We reject smart meters – ‘the green box’
Eskom is busy installing smart meters (‘the green box’) in Soweto and other areas against the will of the people. This is totally undemocratic and often the JMPD is used to force the people to agree to installation. The state is attempting to impose these smart meters onto the community, despite overwhelming evidence showing that the majority of people cannot afford to pay for electricity. If the governing party nationalized the commanding heights of the economy, and placed it under worker control, as well as the banks and the land, and championed a job led industrial strategy, we would be able to afford free quality education, healthcare and electricity. Therefore we demand free electricity for all! We demand free basic services for all!
6. We reject the nuclear deal
There are plans to build a nuclear power station in South Africa in addition to completing the build programs on the coal fired power stations. The nuclear deal will cost the fiscus at least a trillion rand at a time when there is low growth in the economy and against a backdrop where the working class majority is under severe economic strain. Poverty levels are high and more than a quarter of the population is unemployed. Both nuclear and coal-powered electricity generation are a hazard to the environment and to the health and well-being of everyone. The national purse is still servicing billions in debt which were spent on building the Medupi and Kusile coal fired power stations. Only for Eskom to tell us that they now have an oversupply of electricity! Nuclear energy generation will be a disaster. It is expensive and it is not labour intensive which means workers will lose jobs. It is clear from the proposal to increase tariffs that it is the consumers and taxpayers who will be made to pay for the nuclear deal. This deal will without a doubt provide further opportunities for corruption and self-enrichment for the politically and economically connected just like Arms Deal which promised jobs through offsets which were never delivered. Furthermore the cost of building a nuclear plant are likely to be much higher than the one trillion which has been estimated. It is likely to triple as is always the case when it comes to all nuclear projects all over the world.
We demand clean, safe energy for all. We demand a just transition from fossil fuels to a socially owned nationalized renewable energy sector in SA. The renewable energy sector must be a mass employer of labour. We are opposed to a transition to renewables that will exacerbate the poverty and unemployment levels in the country thus worsening the socio-economic crisis.
7. We reject Ekom’s attack on jobs
There are 96 qualified trained artisans which Eskom is refusing to employ. These artisans have been working for the SOE for the last three years and yet Eskom is refusing to absorb them permanently in the workplace. Their contracts will come to an end on the 31st of December. Eskom as an SOE is failing to carry out its mandate of contributing to economic development including job creation in the country. It is wrong for the power utility to train artisans and then throw them out into the street. It is a waste of human and financial resources which exposes the hypocrisy of Eskom’s application for a steep tariff increase. We demand that Eskom employ these artisans and provide them with decent jobs and salaries for young people and trainees. We reject the exploitation of these artisans and all other temporary workers.
8. Place Eskom board under worker control
NUMSA and UF have had enough of the corruption and cronyism which is permanently associated with all SOES. We demand that these SOE’s should be better run and managed, with resources being used for the benefit of the majority working class and the poor. They must constitute strategic state intervention in the economy to be both a catalysts for economic growth and job creation. In order to sort out this mess in all SOE’s such as Eskom, we demand that the state should be decisive and reconstitute all the boards to ensure that all social partners such as labor, civil society, business and government are directly represented to ensure that tendering and procurement is handled transparently and that it drives localization and job creation.
We are giving Eskom fourteen days to respond to our demands otherwise, we shall together with the United Front, mobilize all communities across the country to embark on rolling mass action campaigns against the SOE.
The struggle continues!
Issued by Irvin Jim, NUMSA General Secretary, and Trevor Ngwane and Lindiwe Malindi, Co-chairpersons of the United Front Johannesburg Region, 30 November 2017