MEDIA RELEASE: Does South Africa now have a labour government?



Statement by Herman Mashaba, Chairman, Free Market Foundation

Does South Africa now have a labour government?

Date:  22 July 2013

Release: Immediate


I can come to no other conclusion. We now have a labour government in South Africa. In response to my criticisms of our country’s diabolical labour laws, which have caused 7.9 million people to be unemployed according to the latest statistics, I find myself confronted in debates by representatives of labour unions, not the Ministry, or the Department of Labour, or the parliamentarians in charge of the labour portfolio in parliament who are responsible for labour legislation.


In the month of June alone I found myself on one day debating Sdumo Dlamini, President of COSATU, on Radio 702. Then it was Patrick Craven, COSATU spokesperson, on SAFM PM Live. And then Irvin Jim, Secretary General of NUMSA on SABC TV3. A week later I debated Zwelinzima Vavi, Secretary General of COSATU on Power FM and then the very next day again on SAFM. Another week later I engaged with representatives of FEDUSA and AUSA on CNBC Africa. In every one of these debates we were talking about the labour laws. But the labour unions do not make the laws. Proposed laws are generated by the Ministry and Department of Labour, approved by the Cabinet, and then forwarded to Parliament for consideration, where the labour unions may comment on the laws but the making of the law rests with Parliament and finally with the President who signs them into law.


During each one of these debates I stated very clearly that I was in favour of the role that labour unions perform in representing their members. I also told the labour union representatives that I was talking to the wrong people; that labour unions were not responsible for making the laws and were therefore not responsible for the negative consequences of the current laws. No matter what the views of the labour unions might be in their labour union roles, they are not the lawmakers. The government executive and the members of parliament make the laws and must take full responsibility for any unintended consequences they may cause.


According to the Labour Force Survey first quarter statistics (strict unemployment rate) there are 4.6 million unemployed people (25.2%). But this figure disguises the truth because it leaves out those who have given up looking for work. The real total is 7.9 million unemployed, 36.7% of the potential workforce. Of the 4.6 million people who are still looking for work 3 million have been unemployed for more than a year; 1.3 million are aged 15 to 24 and 1.8 million between the ages 25 to 34. We cannot allow these figures to become just statistics. These are human beings who live in our communities across the country, many of them young people who are having their hopes and dreams destroyed by unemployment. This situation must change! Quickly!


The solution, as the Free Market Foundation has been saying over and over again, is to remove the cause of the problem, which is the labour law dispensation that takes away the rights of the unemployed. Voluntary co-operation between workers and employers is crucial to peace and prosperity in this country. In an environment that functions on voluntary co-operation “workers own their labour and employers own the jobs”. In such an environment, individual workers have the right to decide for themselves what wage or working conditions are acceptable. Except in the case of fraud or force by either party, no outsider should ever have the right to intervene in this most basic economic relationship. The laws must be changed to accommodate such co-operation and restore the rights of the jobless to make their own decisions about their own lives.


On its website the Department of Labour (DOL) describes its Vision as follows: “The Department of Labour will strive for a labour market which is conducive to investment, economic growth, employment creation and decent work.” Under Activities it says: The Department of Labour will play a significant role in reducing unemployment, poverty and inequality through a set of policies and programmes developed in consultation with social partners, which are aimed at: Improved economic efficiency and productivity - Employment creation - Sound labour relations - Eliminating inequality and discrimination in the workplace – Alleviating poverty in employment.


The average employer probably believes that the DOL is intent on creating an environment that is not “conducive to investment” or “economic growth” or “employment creation”. “Decent work” is not defined but is usually used when taking away the only jobs that poor people have been able to find, such as the jobs of farm workers in De Doorns or factory workers in Newcastle.


It is obvious that the DOL has not met the objective of reducing unemployment. In fact it has played a significant role in increasing unemployment and has, as a result, increased poverty. It has done this by raising minimum wages (thereby reducing the number of people who get jobs) and it is, with the approval of Parliament, currently increasing the rigidity of the labour laws and regulations (which will reduce the hiring of labour even further). Inequality must remain extremely high while 36.7% of the potential workforce is earning zero.


Experience tells me that private businesses (big and small) are not included in the DOL’s list of “social partners”, despite the fact the private sector is, and must be in the future, by far the largest provider of jobs in the country. This does not make sense. Employers and employees are not enemies; they form teams that compete against other teams for the business of consumers. Those prosper who compete best, including the providers of labour from the most modest job to the CEO of the business. Labour unrest is bad for everyone. The DOL should be having regular meetings with private sector employees and employers, encouraging them to co-operate for their mutual benefit, so as to grow the economy; to increase the size of the cake so that everyone can get a bigger slice.


During the debates over the labour policies and laws that I have been having there has been a strange silence from government. I would have expected a member of government to join in the debate and make it clear that government represents the interests of all the people in the country, but there has been silence. I have not heard a word about government perhaps letting the long-term unemployed decide for themselves about wages and what they think is a “decent job” or giving exemptions to small firms so the labour inspectors stop knocking on their doors.


And when are the members of Parliament going to stand up for the 7.9 million unemployed people? They are citizens and voters too. When will they vote to release the unemployed from the shackles of the labour laws? Or do I ask these questions of deaf ears? Does South Africa already have a labour government?


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