Address by Zwelinzima Vavi, General Secretary of the Congress of South African Trade Unions, to the national Congress of the National Union of Mineworkers, Midrand, May 28 2009
Comrade President, Senzeni Zokwana
Comrade General Secretary, Frans Baleni
Office Bearers and NEC delegates
Comrades and Friends
Thank you for inviting me to address you, the leaders of our biggest union, the National Union of Mineworkers, at this most important Congress. I am always honoured to come back to my first home in the trade union movement and share our experiences of struggle to transform the lives of our members, our families and communities.
I must first of all express my anger and grief at the number of your members who have been taken from you in the totally outrageous number of accidents over the past few years, in particular the nine who lost their lives just last week. I send COSATU's condolences to all their families and comrades and promise the NUM every possible assistance as you campaign to raise the levels of health and safety in the mines and stop the carnage of workers.
I want to take time to deal with this, the biggest crisis our country has ever faced - the impact of the international economic crises in our economy.
In the first quarter of 2007, the mining sector's output grew by 4.2% and the level of employment grew by 8.8%. In the fourth quarter of 2008, the mining sector grew by -5% and employment grew by 4%.
Today, we are sitting with a mining sector that continues to face difficulties. Recent statistics show that this year, the mining sector grew by -1.7% whilst employment did not grow at all. In the next quarter, we expect the mining sector to start shedding jobs all-round.
Turning to the construction sector, in the first quarter of 2007 this sector's output grew by 16% and employment increased by 3.4%. Today, output in the construction sector has grown by -0.3% and employment has grown by 1.3%.
The negative growth rate of output in the construction sector does not lift employment prospects in this sector. When a sector that does not export collapses from a growth rate of 16% to -0.2% in such a short space of time, we have to ask ourselves about the extent to which the global crisis is responsible for our woes.
Plummeting of global commodity prices as a result of the global recession played a significant role in the performance of the mining sector. The global price of metals fell by 38% in the fourth quarter of 2008. This had massive impact on the sustainability of the mining sector.
But commodity prices also determine the exchange rate, since we are still very much a resource-based economy. Plummeting global commodity prices lead to a depreciation of the exchange rate. But from the standpoint of the mining sector, this has no significant impact because the depreciation cancels out the commodity price decline. What is hurting however is the fact that global demand for mining products has fallen sharply.
I want to note the following developments in summary: Before the crisis employment grew by 8.8% in mining, now it is stagnant and is already falling. Employment in the construction sector grew by 3.4% before the crisis, now it grows by 1.3% and workers may have started losing jobs.
The fact that the mining sector, which still relies on global demand, prices and the exchange rate for its performance, is performing poorly together with the construction sector, which is a domestically based sector, says something about the need to interrogate the role of domestic macro-policy in shaping current developments.
The revelation that the country's gross domestic product (GDP) dropped by 6.4% in the first quarter of 2009, even worse than the drop of 1.8% in the fourth quarter of 2008, proves that South Africa has indeed not escaped from the global downturn. The implications for jobs, living standards and economic growth are frightening.
We are now officially deep in a recession, for the first time since 1992. It is a national emergency, requiring immediate and drastic steps to save jobs, protect living standards and prevent the economy falling even further into recession.
It requires an immediate response from government, labour and business to defend our jobs and livelihoods. The most urgent measure must include:
•· The rapid implementation of all the measures contained in the 'Framework for South Africa's response to the international economic crisis', which was negotiated at the Presidential Joint Economic Working Group meeting held in December 2008.
•· An immediate cut in the repo rate of at least 200 base points to stimulate investment and demand;
•· Emergency measures to protect the most vulnerable industries;
•· A shift by the new government to more expansionary economic policies, including a radically expanded public works programme to provide work for the growing number of unemployed.
Even before these figures came to light, our Central Executive Committee took time to discuss the unfolding international economic crisis. We warmly endorsed the Framework Agreement, which is now more relevant than ever.
We called on all affiliates and other unions to ensure that this document is translated into an effective tool to fight job losses and cushion the poor from the effects of the crisis, as envisaged in the agreement. We are conducting research to discover the extent of the jobs crisis in the sectors you cover - mining, quarries, construction, etc.
Every union must build capacity to use the agreement to maximum effect, convene meetings in their sectors with the employers, relevant government departments and the relevant state owned enterprises to ensure that all the aspects of the framework are implemented in all affected sectors of the economy.
We believe that the previous government was not acting with the necessary urgency required to take forward the spirit of this Framework Agreement. The task teams charged with implementing it have not functioned. That must change forthwith!
The CEC also called for solidarity amongst affiliated unions and workers in general. No trade union movement worth its salt would just fold arms at the time when its members and workers in general are paying the price through losing their jobs and livelihoods, for a crisis they did not create, a crisis in fact caused by inequities in the global economic system and corporate greed in many parts of the world.
We record that workers in employment provide the social safety net for the unemployed through sharing their often meagre wages with unemployed family members and friends. The CEC in February called on members in employment to consider what additional measures of social solidarity it can show to the unemployed and to those whose jobs are at risk.
That recalled the historic efforts in 1999 to donate one day's pay to a Fund to create new jobs. Unions undertook go back to workplaces to hear from members how they will respond with solidarity to those most affected. At the CEC and perhaps at the forthcoming national congress of COSATU we must again show leadership and solidarity and make another call on workers to once again donate their one day's pay to the existing fund to create new jobs.
The principle outlined in the Framework for South Africa's response to the international economic crises that ‘the risk of unfairly placing the burden of the downturn on the poor and the vulnerable must be avoided" must be adhered to and practicalised. This pain must be shared! In this regard, the COSATU CEC calls on the corporate sector to urgently and seriously review the perks and the extraordinary high salaries paid to CEOs and senior management.
These should be cut to the bare minimum as part of companies preparing to meet the economic downturn. Retrenchments must be used only as the truly the last resort when everything else including elimination of wasteful expenditure and high executive pay, has been tried.
We reject with contempt the flurry this week from some conservatives who have called on workers to soften their wage demands. These calls are misdirected! To them we say, direct these calls to the fat cats leaving beyond the means of our economy.
Just as we warned in February, there was a sharp rise in unemployment figures for the first quarter of 2009. We are calling on all unions to monitor very closely the ongoing carnage of job losses and discuss whether COSATU and other federations should consider filing a Section 77 notice to protest against the job-loss bloodbath.
There are predictions that this year alone, almost a million workers will lose their jobs, which means that the number of unemployed will rise drastically, far more than earlier predictions that job losses for this year would peak at 250 000.
Growing unemployment poses major social and economic problems not just for workers and their families, but also for the new ANC government, which will now struggle to meet its target of halving unemployment and poverty within the first two decades of freedom.
Under the 2005 ASGISA, government suggested that if economic growth rose to 6% by 2009, it would be possible to cut down unemployment to around two million or 14% of the labour force by 2014. Now production is falling by that same amount, but the task of creating decent work is more, not less, necessary.
Otherwise this job loss bloodbath will have a devastating effect on the working class and poor families. These workers are often women and breadwinners who support extended families.
As we face up to these immense challenges, we have one huge advantage. Unlike in previous economic crises, we have an ANC Government, which fully shares our concerns and is committed by its manifesto to the same policies, which we have put forward.
The Minister of Economic Development is from our ranks! We must ensure that the mandate of the Ministry remain a place where all government policies are coordinated from. If we succeed against active campaigning by some, then this will be a massive breakthrough for the left.
We call on all South Africans to stand together to weather the economic storm and we call on government to ensure that appropriate changes are advocated at global level to make sure that the deep-seated inequalities and lack of regulation in the global economy are rectified so that the world that emerges from the crisis is one founded on social justice, fair labour standards in all countries, equitable development and decent work for working women and men across the world.
The elections and the post election processes have also demonstrated the alliance's resilience. The Alliance has never been this strong! We are enjoying a spell of unity, cohesion and high degrees of common purpose. The challenge is how we will keep this unity strong in the light of the challenges ahead.
But unless we remain vigilant and strong and walk through the doors we have opened, all the victories and gains will be picked from the floor by others.
The biggest mistake we could make is to sit back and leave government alone to solve the problems. COSATU, and the NUM, must work side-by-side with our ministers and make sure they keep on track. We must continue being the conscience of our democracy and spokesperson of the downtrodden. We need to provide leadership not only to our members - but also to the people as a whole.
To do this we have to get our own house in order. The 2015 Plan enjoins us to recruit more members, improve service to members, strengthening our workplace struggles and sharpen our weapons to engage with workplace transformation.
We have not driven the recruitment campaign, as we should have done. The OD was not driven uniformly. Whilst some unions have consistently looked at how they improve their systems a number has done very little. Service to members has not tremendously improved.
Too many workers complain about the inability of some of our shop stewards, organisers and union structures to defend them. The current wildcat strike involving public sector doctors is the warning that workers can leave the unions behind and steam ahead in the processes to find new champions to advance their interests.
At the same time we must keep the ANC united, vibrant and strong. The damage to its unity and cohesion is testified by the existence of COPE.
Now that the elections are over we must deal with both organisational and political problems we have identified. The ANC has to challenge the crisis in the Western Cape and help unite that province. Solving other problems elsewhere in particular in the North West cannot be postponed.
We must confront some of the underlying problems that compound these problems. The biggest is the new culture that has taken over a significant number of our leaders and cadres - crass materialism - this big rush to be rich through whatever means possible, highlighted recently by the R1 million Mercedes offered to, but thankfully rejected by, Transport Minister Sbu Ndebele.
The origin of this culture lies in the system of capitalism itself, the biggest corruptor of human kind. It manifests itself in the use of patronage, abuse of state power and institutions, corruption, factionalism, backstabbing, personal hatred of comrades by others. This tradition is not limited to the ANC. It exists in COSATU and elsewhere. We must confront it before it consumes our organisations and leaves them a shadow of their former selves. If we fail, so will our revolution move off the rails.
I wish you a very successful Congress and many years of growth and success.
Issued by COSATU, May 28 2009
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