COMMENT

The unions' pyrrhic victory at SAA

William Saunderson-Meyer says what is taking place is a unionist paradigm shift

JAUNDICED EYE

Conservative commentators and radical workers are in rare agreement. 

Both believe that the South African Airways (SAA) strike was a great success. When push came to shove, government blinked. Again.

Predictably, they differ in their interpretations of what this means. The workers think that they have assured the future of the carrier and that their style of militant, brinkmanship has been vindicated. The conservatives think that it signals a crippling defeat of President Cyril Ramaphosa’s government and the imminent closure of the airline or, alternatively, a financial crisis that will imminently see all the state-owned entities tumble like dominos, one after the other.

They are both right. And both wrong. It’s not simply about victory or capitulation. This is not sport, which has unambiguous winners and losers. In politics, while both sides perhaps can’t win, certainly both can lose.

As I’ve written ad nauseam over the past few years, it is vital that the government curbs the bloated and rampant public sector unions. That’s difficult when the enemy is within — part of your African National Congress’s tripartite alliance with the trade union congress (Cosatu) and the communist party (SACP). 

And as I wrote last week, SAA is the terrain that CR’s administration has chosen for that battle, by baulking at yet another open-ended bailout of the national airline. It also initially refused to increase a 5.9% wage offer, which at 33% above the inflation rate of 4.5% was, by any measure, not only excessively generous but also financially unsustainable for the floundering airline.

After a four-day strike and an additional R400m in lost revenue, SAA settled. But contrary to popular opinion on both the right and left, this was at best a pyrrhic victory.

The workers get their 8%. Maybe. 

Wages will increase by SAA’s initially proposed 5.9%, to start in February 2020, and will be backdated to April this year, with the backpay phased in over three months. This backpay, however, is “subject to the availability of funding”. 

The extra 2.1% conceded as a result of the strike will only be paid if and when a task team of management and workers, facilitated by the dispute resolution authority, manage to find the necessary cost savings. By any measure, this is not quite the union “triumph” that is being claimed.

It gets worse for the unions. The mooted retrenchment of 944 workers — only the beginning, since SAA admits to 30% over-staffing —  will be deferred merely to January. Thereafter, cuts will take place unless the task team manages magically to conjure sufficient cost savings to make retrenchments unnecessary.

Previously, SAA workers and Cosatu had flatly rejected any job cuts at all. Now the SAA unions are claiming, as part of their victory, a four-to-six month “training layoff scheme”. 

What is taking place is a unionist paradigm shift, as economic realities start to overwhelm ideological shibboleths. It’s happening not only on the shop floor but at top level, as strategy adaptations are forced.

Cosatu has historically been adamant that no privatisation would be tolerated. Ever. Even organisational restructuring, such as the proposed splitting of Eskom into three business units, was seen as “back-door privatisation” — something that Cosatu said it would “fight with every weapon at our disposal”.

This week Cosatu did a dramatic about-face from this historical position. Its spokesperson, Sizwe Pamla, told City Press that at this coming weekend’s meeting of the tripartite alliance, Cosatu would propose that although state-owned entities should remain state owned, moves should also be made to identify those that could benefit from “partial privatisation”.

“SOEs need to be cleaned up. We need to ensure that they do not keep haemorrhaging money.” 

This did not mean, Pamla hedged, that “general sentiment” had “entirely changed”. Cosatu still wanted majority government control of SOEs and it would support partial privatisation “only for those SOEs deemed in need of this”. 

It will be interesting to see how the SACP, which proclaims itself publicly as the “vanguard party of the working class” — and privately considers itself to be the brains trust of the alliance — will respond to this unexpected and cheeky phenomenon of independent thinking by Cosatu. So far, it has said only that it will wait to hear Cosatu’s argument at the weekend, before responding. 

So, for the first time, an ANC government has stood up to Cosatu, with promising results. However, the problem for Ramaphosa is that the state of SOE finances is such that there isn’t really time for this kind of long campaign of attrition against union privilege.

It had needed a quick, definitive victory at SAA and it failed to achieve that. If the government tries to buy more time with yet another round of bridging finance — so that the unions are forced to face the realities of SAA’s plight in early 2020, when the task teams meet —  it might find escalating events have made it all irrelevant.

This week, passengers and travel agents started deserting SAA in anticipation of a collapse. That might be the final nail in the SAA coffin.

@TheJaundicedEye