South Africa: "This time it will be different"

June 18th, 2009

 

 

Johannesburg (South Africa) - Just days after President Jacob Zuma’s 3 June State of the Nation Address on accountability in government and jobs for the people, the trades unions hit back with calls for wage rises and the sacking of the Governor of the Reserve Bank. The leader of the Congress of South African Trade Unions (Cosatu), Zwelinzima Vavi, and his counterparts are caught between their new friends in the African National Congress government and the high expectations of union members that this time the relationship with the ANC government will be different.

A strong supporter of Zuma over the past five years, Vavi is determined to make the new order work. Union leaders and their members prefer Zuma to his rival and predecessor, Thabo Mbeki, but expect some fierce battles ahead over policy and public sector pay. Many public sector unions are poised to strike in the coming months should negotiations in the current wage round fail.

The suggestion by Public Enterprises Minister Barbara Hogan that unprofitable state enterprises could be privatised will further inflame union sentiment. Enthusiasts for selling off state assets are looking closely at the beleaguered state-owned power company Eskom, which made substantial losses last year and is struggling to raise finance for a more than US$10 billion expansion programme. On 22 June, the National Energy Regulator of South Africa will decide on Eskom’s vastly unpopular request for a 34% increase in tariffs that it argues is necessary to meet funding shortfalls.

As job losses creep up again, a new report from the Centre for Development & Enterprise thinktank is calling for tax breaks and exemptions from most labour laws on hiring and firing, and health and safety provisions together with employment guarantee schemes on subsistence wages. The unions are opposed to such schemes, which they regard as creating a two-tier labour market, and insist on ‘decent work’ with full legal protection.

Vavi refused a job in government because he wanted to bring the unions back into government decision-making and presumably to stop those sorts of changes to the labour laws. That role for the unions is not universally popular: the ANC Secretary General, Gwede Mantashe, has questioned the loyalty of those in the unions and South African Communist Party (SACP) who are already criticising the Zuma government.
 
This could indicate a healthy opening up of politics or presage social turmoil as the unions press their case amidst the worsening global recession. Vavi and SACP General Secretary Blade Nzimande appear torn between their association with the new government and the demands of their members, but the tension is less, so far, than that which was routine under ex-President Mbeki. Cosatu and SACP leaders say Zuma promised them control of the ANC: ‘We (Cosatu, SACP and ANC) are the policy makers and the government implements,’ said Vavi. Members of Cosatu affiliates want more pressure on Zuma to keep his pre-election promises. 

On 5 June, Cosatu warned that Zuma and his ministers were sitting on a ‘ticking time bomb’ of rolling mass action by ‘restless and angry’ public servants. Cosatu President Sdumo Dlamini told Business Day that ‘Workers are sick and tired, they simply have had enough.’ The global economic crisis is hurting South Africa, with company closures and job losses. Trades unionists fear losing their jobs. Grassroots members suspect Zuma of telling their leaders one thing in private, while saying something different in public.

Cosatu and SACP leaders who were sceptical of endorsing Zuma are now reasserting themselves. Pro-Zuma activists have been rewarded with jobs in national and provincial governments, leaving his critics to take centre stage in the affiliated organisations.

The loudest cheerleaders for Zuma were Vavi and Nzimande, who accepted the offer of a job as Higher Education Minister; his deputy, Jeremy Cronin, became Deputy Transport Minister. Some SACP members want Nzimande to resign as General Secretary, but he wants to hold on to his SACP job in case Zuma fails to deliver. Vavi rejected an offer to join the cabinet, preferring to stay with the unions. The SACP and Cosatu will hold national conferences in September that will elect new leaders, and there are moves to depose both incumbents. Grassroots SACP members are angry with national Chairman Mantashe, who in his other role as ANC Secretary General has lambasted the government’s left-wing critics.

Serious policy differences are appearing about how to tackle the effects of the global crisis. Cosatu and the SACP demand, as usual, that the Reserve Bank stop inflation targeting, intervene to soften the rand and refocus its mandate to create jobs. And they want Zuma to fire the Reserve Bank Governor, Tito Mboweni, who is up for reappointment on 8 August. The union demands mean that the government is almost certain to reappoint Mboweni; the alternative would be to appear to give in to union pressure.

The inflation-targeting strategy advocated by Mboweni is also strongly supported by Zuma’s economic team: Development Planning Minister Trevor Manuel and new Finance Minister Pravin Gordhan. The unions’ call for lower interest rates – ruled out under the inflation-targeting strategy – would do little to help South Africa’s mining companies and manufacturers compete in international markets.

 

source.Africa Confidential