Archive | Labour

National low income retirement plan ahead

 State retirement plan possible….

dol logoIn terms of what has been expected for quite some time, the department of labour (DoL) is soon to launch an investigation into a national retirement mechanism for low income earners. Such has been announced to the parliamentary committee on labour.

DoL, in a statement issued shortly after the meeting had been held, added that a discussion paper on the issue would be tabled at Nedlac in the near future.

In the last month of the previous parliamentary session the portfolio committee on labour held a number of workshops on the minimum wage issue and other matters perceived as critical in the labour field. Pensions for low income earners was one of them.

Stakeholders join in

During these workshops, which the department’s performance against set targets contained in the strategic plan and annual performance plan was evaluated, strategies were developed by participating parties, contributing parliamentarians and DoL.

DoL also stated that it would be talking to ILO as part of its investigations into a national retirement programme, not only as far as best practices were concerned but also into what had been found possible and practical at certain income levels elsewhere.

old mutual logoIn a recent survey undertaken by the Old Mutual on retirement plans, 42% of respondents were found to have no formal retirement provision in place at all and 85% of those that did, stated their concern on not having enough money to retire as their greatest worry due to fears surrounding inflation.

DoL is now to go a step further into the area of the of an income bracket lower than dealt with by private pension fund operators and, says DoL, plans are also afoot to investigate the possibility of including government employees in the benefits offered by UIF and also the effectiveness of the Compensation for Occupational Injuries and Diseases Act.

Other articles in this category or as background
Labour committee ignores strikes – ParlyReportSA
Parliament delays process on Labour Relations Bill – ParlyReportSA

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Muscle may be added to LRA

Feature article….

BS000318LRA needs beefing up, says DA ….

A political confrontation is no doubt about to occur and possibly street unrest regarding the parliamentary notice now gazetted tabling a Bill proposing changes to the Labour Relations Act (LRA).

It also proposes empowering  labour courts to declare the cessation of a protected strike or to refer the protected strike for arbitration in the event of riot damage.

Public comment to Parliament was allowable until December 7 on the Labour Relations Amendment Bill PMB2-2014, which DA MP, Ian Ollis, intends introducing a private member’s bill.

Responsibility for violence

The opening wording of the gazetted notice stated that notice of an intention to “amend the Labour Relations Act (No. 6 of 1995) to make provision for trade unions to be accountable in the event of violence, destruction of property and intimidation by union members during a protected strike, and comments are requested.”

The background to the Bill notes that “statistics from recent protest action in the metal and engineering sector show that in the first two weeks of the strike, 246 cases of intimidation, 50 violent ‘incidents’ and 85 cases of vandalism were recorded.”

Views of Cosatu

Cosatu spokesperson Patrick Craven said, in response to DA statements issued as result of the gazette being published, “COSATU will campaign relentlessly, thorough the alliance, in Parliament, at the Constitutional court and in the streets, to ensure that such a law is defeated.”

By “alliance”, Craven is presumably referring to factors such as whether ANC MPs will join ranks and vote against the Bill at portfolio committee level when introduced.   This meeting will not occur until at least February and March 2015.

It is to be noted that as a private member’s Bill, this Bill is not tabled by the minister of labour, nor is associated in any way to any draft or proposal emanating from the department of labour.

How to strike properly

 The Bill, as proposed, provides for the accountability of trade unions in the event of violence, destruction to property and intimidation by union members during a protected strike.  The legislation also requires unions to educate workers regarding violence and on labour law procedures before strikes and by law unions are to provide marshals for crowd control who have been

ian ollisOllis, who is shadow minister for labour, says that his Bill also proposes that “courts would be empowered to stop a strike that is  properly trained for such and “to prevent criminals infiltrating union ranks”.excessively violent by forcing the parties into arbitration, to declare a violent strike as unprotected and to award damages against unions that have not implemented  such processes.

Bill not needed

The proposals also state that courts would be empowered to award damages against unions that have not implemented the law’s required staff education and crowd marshal training.

Cosatu flatly rejects the Bill. Says Craven, “Cosatu has consistently opposed violence, intimidation and damage to property during strikes and demonstrations, all of which are offences under existing laws and therefore require no new law to deal with them.”

The difficulty is holding unions to account for violence, a matter which is being attempted to be defined by Ollis, outsiders asking whether laws passed by Parliament are the answer or the problem.

There also appears to be two arguments, or camps of thought, on violence associated with strike action in South Africa.  Many commentators and a wealth of labour lawyers and have pronounced upon these arguments and no doubt they will emerge in Parliament in more detail should the Bill get to the point of being debated.

Two views

The points seem to be the extent to which community poverty and frustration extend into the situation, whether the answer to solve violence exists in the workplace and whether the ability of any law to criminalise contraventions of labour relations tenets can work and if this is the answer.

The kind of frustration that is evident become obvious, as media reported, when a union member exclaimed during the NUMSA metalworkers strike, “If we settle the strike and we get back to work we can save our company and we won’t lose our houses and our cars.   Why on earth would we go to court and start fighting again, risk everything, to get maybe a little bit of money compared to losing all our belongings?” he asked.  This point is raised by Ollis.

But damage to property is the least of the problems, says UCT’s humanities dean, Sakhela Buhlungu, in a speech in Cape Town recently. “The real thing is the loss of lives. With damages, in fact the beneficiaries, if this Bill goes through, will be the people who own property.   It is the poor people who will be caught in the crossfire because they are viewed as  scabbing. How do you compensate those people?  Do you say the unions must pay for lost lives?  You can’t quantify that”, she told her audience.

Poverty driven

Clearly the violence is well outside the arena of whether collective bargaining is working or not but the one view is that it is another manifestation of community frustration amongst those living below the breadline.

Buhlungu said to her audience, “Look at domestic violence; it is out of control.  Look at child rape; it is out of control.  Look at violence by the police against the public; it is out of control.  Violence is so pervasive that, in fact, it would be a surprise if a strike were not violent.”   Clearly, she said, the passing of laws will not resolve such issues.

On the same side of the coin also is the pragmatic view noted by Graeme Simpson, renowned labour writer of many years who in 1994, the year of independence, wrote, “The potential of the workplace as an agency for social change is severely under-utilised, and the narrowly conceived strategies to insulate industrial relations thus actively undermine the potential for relative peace (in the workplace).”

In the context of the violent strikes at that time (Checkers etc), Simpson said, “The vision of most employers has remained rather conservatively limited to futile attempts to insulate or protect the workplace from encroaching violence, rather than engaging in any way with the origins of the problem beyond the factory gates.”

Township stress

Simpson noted that research conducted then by the Centre for the Study of Violence and Reconciliation had shown that community-based violence (whether political or criminal) and the trauma associated with victimisation and stress resulting from potential or indirect victimisation, had the effect of broadly polluting workplace relationships.

There is a vital need – with attendant advantages – for business and trade union leaders, said Simpson, to engage jointly in interactive planning to harness the potential of the working environment as a proactive arena of peaceful social change, whilst simultaneously addressing the concrete needs of the most victimised township communities in general.

In the meanwhile the Centre for the Study of Violence and Reconciliation has evolved a four-pronged approach, it says on its current website, for dealing with the impact of violence on industrial relations. These programmes include the idea that the workplace is a place where violence-related trauma can be treated and training must be given to support and counsel traumatised co-workers.

Bigger business role

Communication, says the Centre, to generate information and sensitivity to the shared problems of violence and their influence on industrial relations is much required and importantly all companies should engage in community development and upliftment involving violence monitoring and conflict resolution processes beyond the shop-floor.

Also the Centre sees as an imperative that there have to be more community development initiatives from all businesses with workforces where worker or community representatives are party to decisions on allocating resources for corporate social upliftment programmes.

The second camp of thought clearly see Marikana as a Rubicon that was crossed which has so totally changed the labour environment that labour courts must have more powers to administer their decisions and that it is the unions that must change. The Bill proposes changes by criminalising failure to adhere to such amendments to the Labour Relations Act or at least making perpetrators culpable. Enough is enough, is the thought pattern.

Said Ollis in a DA statement as the Bill was tabled in Parliament by the Speaker, “A law is needed to ensure that unions be held responsible for all conduct that could potentially cause foreseeable damage to property, result in injury or loss of life.”

“Members of the public and business owners should thus exercise their rights and hold unions accountable for damage to property resulting from strike action,” he concluded.

Round the corner from Parliament, JP Smith, who is responsible for safety and security on the Cape Town mayoral committee said angrily a week or so ago, when accounting for all the damage done by strikers was being accounted for, whether by union members, just frustrated poor people or Cape skollies, “It is about highlighting the individuals, prosecuting them, exposing them to the media. What we need is for actions to have consequences for individuals.”

President’s response

Meanwhile, when speaking in Parliament, President Zuma did indeed condemn the violence associated with the Numsa strike but he gave no indication that concern about violence would result in fundamental changes to policy or legislation, as proposed by Ollis.

“We have enough instruments in our labour relations machinery to resolve labour disputes,” said Zuma to the National Assembly.

According to Patrick Craven of Cosatu, the “draconian principle” of criminalizing unions by default ignores the fact that employers are also at fault and he sees the threat to award financial damages against a union as having the potential to bankrupt unions and force them to disband, “which is surely what the DA, and its friends in business, want”, he added.

Most discount this argument as an exaggeration although it might appeal to Craven’s own audience.

COSATU needs collective bargaining

Craven added that in Cosatu’s view by empowering courts to force employers and unions into arbitration where strikes are excessively violent, or declare such a strike unprotected “would give the state unparalleled power to undermine collective bargaining and the basic human right to withdraw one’s labour.”

The department of labour recently released its Annual Industrial Action Report and this makes for compelling reading, says Johan Botes, director at Cliffe Dekker Hofmeyr, who no doubt will make submissions to Parliament on the subject of the new Bill.

“Most worrying,” notes Botes “is the fact that the percentage of unprotected strikes has increased from 2012 to 2013.   The report indicates that during 2012, 54% of strikes were protected whilst this number fell by 6% in 2013.”

“This may suggest a number of troublesome issues, including lack of regard for the law or the consequences of unlawful conduct, growing frustration and antipathy towards employers, or further support for the view that our collective bargaining processes and (SA labour) practices are in dire need of an overhaul.”

More jobs lost

Botes says it also worrisome that large groups of employees are being exposed to dismissal as result of their participation in unprotected industrial action whereas focus surely ought to be on how to save jobs and limit or prevent unnecessary dismissals.”

“The need for greater compliance with legal requirements before embarking on industrial action should be more emphasized, when considering the alarming reports of other unlawful activities connected with strikes, whether protected or unprotected, and which activities include assault, intimidation and causing damage to property,” he notes.

The ANC, as a party or alliance, has not made its views known at this stage on the Bill, nor any stance to be adopted by its party whips.
Ollis of the DA is convinced that Parliament must pass such an amendment to the LRA “where action could result in injury or loss of life”, thus ratcheting the parliamentary argument up a notch or two.

Fall back

Last word goes to the background of the Bill itself which states, “Though the Regulation of Gatherings Act 1993 the law imposes restrictions and prohibitions upon gatherings and demonstrations that cause “riot damage” to third parties, the current provisions within the legislation fail to address instances where damage caused to persons and property by strikers in the course of promoting the objects of the strike and which does not necessarily occur within the structures of a gathering or demonstration.”

Ollis says, “Indeed, harm caused by strikers often occurs underhandedly at strike-breakers’ homes and as strike participants move to and from strike locations – violence and damage to persons and property therefore occurring outside the formal strictures of a sanctioned strike or gathering, yet acting in furtherance of union-supported collective action.”

He concludes, “This Bill thus seeks to provide a statutory duty on trade unions to take reasonable steps to prevent harm to persons and property within the Act.”
Other articles in this category or as background
http://parlyreportsa.co.za/labour/labour-committee-turns-away-strikes/
http://parlyreportsa.co.za/labour/labour-relations-act-changes-passed/
http://parlyreportsa.co.za/bee/rumblings-in-labour-circles-on-bee/

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DTI earns ire of Parliament on BEE

 

Lack of BEE transformation flagged….

plan BEEThe divergence of views on BEE between the parliamentary committee on trade and industry and the department of trade and industry (DTI)  heightened recently with committee chairperson, Joan Fubbs, demanding that within seven days a “technical explanation” as to why  DTI was not hastening speedy transformation within South Africa.

A full report on Broad-Based Black Economic Empowerment (BBBEE) had to be submitted. to all the members of her committee on progress, or the lack of it in certain areas and the reasons why,  she said, and this was to be submitted before the Christmas recess for further debate in the New Year first session.

Uphill presentations

After a presentation on the current position regarding BEE as a broad subject, Ms Nomonde Mesatywa – chief director of DTI’s BEE secretariat – ran into heavy traffic upon her failure to quantify the nature and amount of research that had been conducted on the success or failure of BEE and the total lack of data on its implementation in her presentation.

The governing party MPs bitterly complained regarding the “soft nature” of recent BBBEE legislation, including the recent BEE Amendment Bill and the powers and suspected lack of ability of the proposed BBBEE Commission to enforce any of the current legislation.

Ms Mesatywa went through the standard briefing for the benefit of newer MPs to explain that the Act had been amended and promulgated in January 2014 to ensure standardisation in reporting from all sources reporting across the economy; the BBBEE Commission having been established to monitor and evaluate BBBEE processes.

The new amendment, she said, aligned the anchor legislation with other legislation impacting on BBBEE and with the Codes of Good Practice.  All the provisions had come into effect on 24 October 2014, she said, except for the trumping clause (section 3), which had been deferred for 12 months and would come into force in October 2015.

DTI said the alignment of sector charters was at an advanced stage and included the construction, property, tourism, transport, financial, mining, chartered accountancy, forestry, agriBEE and IT charters.

Elite only benefitting

Committee members from both the opposition and governing party both lodged complaints that there was a public perception that it was only the black elite who benefited from BEE programmes and there was little factual evidence to the contrary that “ordinary black South Africans” were benefitting.

The Democratic Alliance said it was totally offensive that the state offered a reward to companies only if they complied with BEE regulations and if they did not do so, not only could they not do business with the state but also not with any other companies that dealt with state. The DA described this as “awful”.

The EFF was called to order for suggesting that economic transformation would only be realised “if the ANC was taken out of power” but it was the ANC who sought clarity from DTI on how the new mechanism of using a commission in terms of the new Bill could possibly monitor and evaluate compliance “to ensure that the Codes of Good Practice were taken seriously.”

Long term view

DTI responded on the basis that they had been “overseeing, monitoring, and evaluating black empowerment for a long time” and they wished to assure parliamentarians that they had the experience to do this.

With regard to research generally on the subject of BEE compliance, DTI said their the original survey of some ten years ago showed pretty dismal results at around “level four” but DDG Mesatywa said the latest surveys were on the DTI website and had risen to “level eight”.

The chair commented that such kind responses were vague and unhelpful and the nature and lack of adequate quantitative results was unacceptable and, rather than return for a further presentation in view of the Christmas recess, DTI were instructed to respond in writing to Parliament giving exact numbers on it success or failure, sector by sector, within seven days.

ParlyReport will ask for this document.

Other articles in this category or as background
http://parlyreportsa.co.za/bee/court-ruling-equity-quotas-affects-bee/
http://parlyreportsa.co.za/bee/liquid-fuels-industry-short-transformation/
http://parlyreportsa.co.za/bee/one-year-implement-b-bbee-codes/
http://parlyreportsa.co.za/bee/bee-comes-under-scrutiny/

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NEDLAC gets called to task

NEDLAC not clear on performance……

nedlac logo smallDespite having received an unqualified audit from the auditor general on its annual financial statements, National Economic and Labour Development Labour Council (NEDLAC) officials were requested by the parliamentary portfolio committee on labour to re-present their financial statements to give more clarity on how their 2013/4 budget had been spent.  Once again, chairperson Lumka Yengeni  established that any labour portfolio committee meeting  is no walkover.

Members of the committee complained that the figures presented by NEDLAC needed to be presented on a quarter by quarter basis and had to show specifics of categories spent against budget. Five working days was given for such a report to be in the hands of chair of the committee, Lumka Yengeni.

Mkhize left for family reasons…

Alistair Smith, Executive Director of NEDLAC, who replaced Herbert Mkhize in the 2011/2 year, the same year as that being subjected to special forensic audit by the auditor general, is now himself resigning. When asked by Ian Ollis (DA) why this was so, he said that he wished to spend more time with his family, indicating that total retirement from the business world was on the cards.

The committee noted that the special forensic audit, only recently commissioned, was not of specific interest at this stage as it was a separate matter not connected to the year under review and in any case the report was not yet ready.  However, chair Lumka Yengeni said the financial report now presented to the committee by NEDLAC gave no idea of performance against objectives and equally no idea of programme targets, all of which was the purpose of parliamentary oversight.

Alistair Smith in his review promised to meet the deadline for a fresh report and said that whilst it was the job of NEDLAC to promote economic growth, social equity and decent work through a culture of social dialogue and engagement to bring about effective participation in policymaking and legislation, performance was dependant on stakeholder partners.

Urgent talks on future

He warned MPs that in the short to medium term South Africa’s growth prospects are constrained by global conditions and domestic factors, including low investment and savings, weak domestic demand, low business confidence, energy constraints and challenges in our labour market.    “We need to have urgent conversations about how to tackle these growth constraints and these conversations must be guided by a willingness to resist quick-fix and knee jerk solutions”, he said.

Alistair Smith pointed to the fact that in the area of legislation NEDLAC had achieved much in 2013/2014 despite the constraints of a difficult year due to elections and a change in ministers and their portfolio responsibilities.

Dealt with by NEDLAC during the year had been the Restitution of Land Rights Amendment Bill; the Gas Amendment Bill; the Expropriation Bill; the Public Administration Management Bill and the Unemployment Insurance Amendment Bill, Alistair Smith reported.

New legislation ahead

Currently in hand were meetings and study groups dealing with a new Housing Consumer Protection Bill; amendments to the Occupational Health and Safety Act: compensation factors added to the Compensation for Occupational Injuries Act: regulations for assessment of work of equal value; and a review of the Codes of Good Practice on dismissal factors.

He also warned parliamentarians that it was “necessary that we take stock of the state of our society and especially of the socio-economic challenges that threaten our social cohesion and may eventually even threaten our hard won democratic gains.”

NEDLAC’s balance sheet showed that of the appropriation of over just under R27m, well over 26m had been spent in time and that the long outstanding risk management committee was about to be formed. A complete renovation of the entity’s headquarters, known as NEDLAC House, had been concluded at a cost of R30m.

Also completed,  Alistair Smith said, was work on the Extension of Security of Tenure Amendment Bill and much had taken place with regard to the extended public works programme; access to housing finance; small business financing;  and research on tax matters for the Davis Tax Commission.  Of immediate concern, he concluded, were meetings concerning the National Land Transport Bill.
Other articles in this category or as background
http://parlyreportsa.co.za/cabinetpresidential/nedlac-gets-a-stronger-voice-in-sez-management/
http://parlyreportsa.co.za/bee/back-comes-gender-bill-for-rethink/

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Agri-SA gives views on minimum wage

Tough stuff….

agri-saIn a tense meeting with MPs at working committee level, Agri-SA warned of possible job losses in the agricultural sector if a national minimum wage (NMW) were applied across the board without reference to categories or conditions of employment. The parliamentary portfolio committee on labour had invited Agri-SA and trade union affiliates to comment on the issue of a NMW being applied across the board in all spheres of national employment.

Lumka Yengeni, the chair of the portfolio committee, who caused a stir in the last parliament for touring the country for public views on labour brokers, in addition had called for comment from the mining, industry and commerce. The issue of a minimum wage for domestic workers, however, was not tabled at these series of meetings.

Higher wages the result

In the debate that took place, Hans van der Merwe, Executive Director, Agri-SA, told parliamentarians that a minimum wage set at a higher level than at present as part of a national application would result in a considerable number of structural changes within the farming industry to accommodate what would undoubtedly be, as a result, a call for higher wages in many spheres.

 He said any “adjustments” would no doubt be characterised by the shedding of jobs, increased mechanisation and the consolidation of farming units, as had happened in the past when farmers throughout the country had to “adjust to maintain their competitiveness and profitability.” He warned government that any such moves “should be carefully considered first” since aside from a number of unintended consequences, the target contained in the NDP to create a million jobs by 2030 would be vastly undermined.

Steadily less

Van der Merwe showed parliamentarians that the number of farming units in 1993 was estimated at 57,980, declining to 45,848 in 2002 and to 39,982 in 2007.   The decline in individual units continues, he said, and now some 20% of commercial farms were responsible for 80% of total production.   Employment showed a decline between from 1,093,265 in 1993 to 796,806 in 2007 with further declines since, much of it no doubt due to consolidation of farming units.

He said, “Whilst this does not necessarily imply that consolidated and larger farms are more cost-efficient, it does point to the fact that larger farming units have the financial ability to mechanise. This, against a backdrop of rising costs and in particular rising wages makes mechanisation more and more attractive.”

Agri-SA pointed out that all sectors in industry and commerce consisted of many different and contrasting sub-sectors and this was especially true of the agricultural sector. It ranged from small-scale farmers with a few hired workers to those who only hired seasonally; from some with very low skilled workers to some with a major system of mechanisation and highly skilled operators. He was adamant that there could be no “one size fits all” approach to a minimum wage in the agriculture sector.

The trend overall though, Van der Merwe said, was changing to a situation where in the end there would be fewer but more highly skilled workers with quality jobs and with a higher wage and more complementary benefits.   He produced statistics from UCT to show historically a picture where, as the agricultural minimum wage had increased, so the employment numbers had immediately gone down.

Big squeeze

Finally, he pointed to the fact that a number of farmers had currently hit hard times as a result of the current global economic situation and local recessive climate insofar as exports and local production was concerned and many were going out of business and with financial problems.

Van der Merwe said that in an overall sense the country was going through difficult times in the agricultural sector and there was consequently a threat to national food security targets associated with the decline. He said that the monthly national minimum wage in Namibia was R888, Botswana R5,470, Zimbabwe R590 and South Africa R2,420 and he commented that the issue of a much higher minimum wage would “increase the possibility of South African farmers investing in neighbouring countries where there were more favourable conditions for farming, particularly where labour issues were concerned.”

He also warned that any substitution of local farming produce would be at the cost of South Africa having to import more agricultural produce.

Diametrically opposed

Raymond Mnguni, Food and Allied Workers Union (FAWU), said the union was insulted by the comparison of national minimum wages between neighbouring countries and South Africa.  It made little difference how bad or worse other countries were, he said, but the point was that South African farmers on the whole were paying “poverty wages”.

He indicated that Agri-SA had inferred throughout their presentation that farm workers in this country were a liability rather than an asset.  He said FAWU was “tired” of the threat that farmers would mechanise and cut down on the wages bill every time the question of a better life for working families on farms came up.

Neil Coleman of COSATU disputed Agri-SA’s statistics that showed a decline in employment in the agricultural sector of recent, quoting figures from Free Market Foundation.  In response, Agri-SA admitted that since 2010 to 2013 there had been a minimal increase in employment but their point was that every time there was an increase in minimum wages, employment figures dropped.

What others are doing

Opposition member, Ian Ollis (DA), said nobody wanted the workers to remain poor and he considered the statistics, in fact, slightly encouraging.    Mostly, he added, they showed that Zimbabwe, Mozambique and Namibia badly needed a national minimum wage of some sort very soon.  

He said the debate in South Africa was not about the need for a minimum wage but whether there should be a national minimum, what it should be currently and whether it should applied sector by sector according to the economics of that sector. He said opposition members needed to know how and to what degree Agri-SA were involved in skills training and more about any adaption to mechanisation.

There followed lengthy questioning of dubious quality from various smaller agriculture affiliated unions and opposition members, notably the EFF, on the subject of mistreatment of agricultural workers, low wages paid and matters which did not contribute to the issue of a debate on the NMW.  

At one stage, chair Yengeni called for questioners to refrain from derogatory comments. Ms Mantashe (ANC) called for a detailed written response on the training and up-skilling of farm workers and some accurate figures to be supplied for committee consumption. 

She added that she was disappointed that Agri-SA had omitted the information on the profits made in the sector, particularly comparisons before the 2008 financial crisis and now. Similarly, chair Yengeni called for details of skills training undertaken in the agri-sector.  Agri–SA said such figures were available and would be submitted to the parliamentary committee.

Other articles in this category or as background

http://parlyreportsa.co.za/cabinetpresidential/new-approach-to-land-reform/ http://parlyreportsa.co.za/landagriculture/state-land-reform-process-excludes-expropriation/ http://parlyreportsa.co.za/landagriculture/parliament-discusses-use-agric-gmos/

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Lumka Yengeni

Parliament debates national minimum wage

Sector views on national minimum wage ….

editorial …  Feisty or not, Lumka Yengeni of the parliamentary portfolio committee on labour certainly knows how to advance her career. Whether all her recent parliamentary activity is in line with what Lithuli House wants one never knows but whatever she does seems to attract attention.

The recent hearings on the possibility of a national minimum wage (NMW), which the ANC has stated as a policy imperative, caught most by surprise by the wide ranging topics brought up in debate.  Lumka Yengeni seems to have latched on to ANC policy and summonsed many parties to Parliament to give their views on the subject, including BUSA, the Chamber of Mines and Agri-SA.   Invited to the debates in many cases were also the appropriate union affiliates to that particular sector

Reports on the consequent debates are with clients and will be posted on our website in a fortnight’s time, since immediacy is the purpose of our reports to them.

Maximum pressure for NMW

 The unusual thing about these meetings, as South Africa pivots on the edge of economic direction, is that Parliament should take it upon itself to debate the whole issue of the national minimum wage when the subject also has been scheduled by Deputy President, Cyril Ramaphosa  for a national gathering.

Whether this is naiveté on the part of Lumka Yengeni or plain political upstaging only those close to her will know but the experience of the apple farmers in Elgin over labour broking will testify to the fact that she knows the art of political theatre.

Perhaps, on such a difficult subject, forewarned is forearmed.

Other reports in this category

http://parlyreportsa.co.za//labour/labour-committee-turns-away-strikes/

http://parlyreportsa.co.za//labour/labour-relations-act-changes-passed/

 

 

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DTI gives warning on investment climate

High administered prices a threat…

42X90693In an apparent warning to the economic cluster, a deputy DG at department of trade and industry (DTI), Garth Strachan, warned that South Africa was reaching “a tipping point” where administered prices, either levied or taxed by the various state departments, were so high that it was making the cost of doing business in South Africa totally impractical.

 

There was neither an attractive climate for investors because of high state administered prices, he said, nor did it make any easier DTI’s developmental programme in support of the NDP and attracting investors.

In a frank presentation to the portfolio committee on trade and industry, he qualified DTI’s position during his candid commentary with the caveat that as far as the regulation of administered prices were concerned, such as electricity, port and rail freight charges, road transport costs and water tariffs, that these were not the core competencies of DTI although they were adversely affecting DTI’s current IPAP 6.

Undermining investment climate

He noted later in his talk that in the successive implementation of various IPAPs, including the current industrial plan, DTI had found that administered prices constituted a total impediment to economic development.   In fact, now in 2014, they were providing a “serious economic shock”, as he put it, to the viability and competitiveness of the manufacturing sector.

Garth Strachan commented that the addition of carbon tax could push South Africa to the ‘tipping point’, unless the proposals were with “carefully calibrated policy interventions.”

As far as electricity was concerned, it was DTI’s view that the actual problem lay in the funding structures of local government, especially where no allowance was made for infrastructure upgrading and maintenance. Water shutdowns were also an increasing problem, he said.

He told parliamentarians that in one instance a global investor had experienced 140 electricity and water shutdowns. He did not indicate over what period.

International comparisons

He said that on electricity tariffs, whereas in 2009 when compared to China, the USA, Canada/Quebec, Abu Dhabi, Kazakhstan, India and Russia to give a fair geographic spread, South Africa had been with a group that had the lowest in prices, it now had the “gold medal” for being the highest of all and by 2020 the situation would be exacerbated unless something dramatic took place.

Strachan said that in the World Bank Report of 2013, SA port charges were amongst the highest in the world; container charges being 710% more than the global norm and automotive cargoes costing a premium of 874% more than the global norm. This detrimental fact was compounded by port and rail freight inefficiencies to local destinations.

He told parliamentarians that in DTI’s view it was extraordinary that exports were virtually subsiding raw material exports such as iron and coal.  In the case of coal, this was 50% below the global norm and iron ore approximately 10%, according to 2012 figures, these being the latest DTI could get.

This led, Strachan said, to the unfortunate situation where the country exported iron ore at a net loss to the country but imported girders, cranes and containers, for example, at possibly the highest in the world.  It was impractical to have subsidies passed on to exporters of primary products penalising importers of necessary needs, he said.

On carbon tax, he dismissed any “one size fits all” programme as contributing to the overall problem by making things worse and on climate change generally, he said that DTI was already working towards the protocols agreed by South Africa “through a range of measures to support energy efficient systems and investment in energy.”    These were part of DTI’s manufacturing enhancement programme, he noted.

He said there should be a shift in pricing “in favour of less carbon intensive sectors which are more labour intensive and value adding”. He quoted particularly steel, polymers and aluminium, which he said should be considerably below import parity levels.

Nullifying NDP objectives

Garth Strachan concluded that with manufacturers already going out of business, the issue of administered prices was probably the most important issue facing South Africa at the moment in the search to create more jobs.

Parliamentarians noted with concern what DDG Strachan had illustrated in his review. Many called for a joint portfolio meeting on the subject with public enterprises, transport and energy, despite the subject of administered prices also not being a core function of the trade and industry committee. For example, it was noted, they had no parliamentary right to influence such bodies as Transnet and Eskom, nor deal with treasury on tax and tariffs.

 

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Labour committee ignores strikes

Strikes not given as labour problems….

dol logoActing DG of the department of  labour (DoL), Sam Morotua, when asked before the recent short recess for “the major challenges” faced by his department in the labour market, noticeably failed to mention any of the issues surrounding the current spate of strikes both in the mining and metalworkers section.

This was despite later stating that one of his departmental tasks was to run programmes evaluating the effects of labour issues upon the economy.

New chairperson of the labour portfolio committee, Lumka Yengeni, had broken with normal procedure and asked Morotua to enumerate the most important issues currently being dealt by DOL before commencing the department’s strategy briefing Parliament together with the department’s justification of the current labour budget appropriation for 2014/5.

Chair Yengeni had already put her energetic stamp on the committee’s work programme with a more interactive and vigorous approach during the first weeks of the new Parliament.

Seven problem areas

In response to the question by the chair, DG  Morotua listed DoL’s main “challenges” as unemployment and under employment; the changing nature of work in the country; inequalities and unfair discrimination in the workplace; domestic and cross border labour migration; inadequate instruments for constant performance; monitoring and evaluation of labour market and completing programmes to determine impact of such on the economy.

During the DoL briefing, Bheki Maduna, in charge of finance at DOL, re-confirmed to parliamentarians that for 2013/14 the department received a total of R2.4bn whilst the current appropriation before them for 2014/15 had been increased to R2.5bn.

He said that in the last year, 95% of the budget for administration was spent and also 97% of the inspection and enforcement services budget. Funding “challenges” ahead would be the implementation of the new Employment Services Act; the funding of the new office of chief information officer; new ministerial offices and positions; and the general rising costs of inspection and enforcement generally.

Minimum wages question

In a subsequent meeting of the same committee, when approving the passage of the budget vote to National Assembly (NA), the EFF took the opportunity to make a proposal calling for the introduction of minimum wages in all workplaces, including a wage of R12 500 for mine workers.  A second proposal was made by EFF calling for new labour laws to be amended so that labour broking was scrapped in entirety.

There was overwhelming agreement by members not to debate such changes.

However, in the same meeting, the committee called upon DoL to immediately expedite the process of building the DoL communications technology capacity and investigate the possibility of using the reserves of the unemployment insurance fund (UIF) to improve on benefits payable to UIF beneficiaries and to increase the period over which payments were made, particularly maternity benefits.

Subsequently when the DOL budget vote came before the NA, labour minister, Mildred Oliphant brought the House up to date on the DoL legislative programme.

Labour law amendments

She stated that amendments to the Compensation for Occupational Injuries and Diseases Act were in final draft stage but the questions of rehabilitation, re-integration and return to work were awaiting consultation with stakeholders.

She announced that the Basic Conditions of Employment Act would be amended regarding the issue of inspection and enforcement, confirming DOL’s earlier statement to the portfolio committee that additional budget would be required in this area.

All new regulations to the Employment Equity Act had been finalised, she said, publication being awaited; the Unemployment Insurance Act was to be amended and that these changes related to improvements of benefits and the submission of information by employers to the unemployment fund; and amendments to the Occupational Health and Safety Act were necessary because of the shortcomings in the way that health and safety was being regulated in the country.

Other articles in this category or as background
http://parlyreportsa.co.za//labour/labour-relations-act-changes-passed/
http://parlyreportsa.co.za//cabinetpresidential/parliament-delays-process-on-labour-relations-bill/
http://parlyreportsa.co.za//bee/rumblings-in-labour-circles-on-bee/
http://parlyreportsa.co.za//bee/dates-for-new-labour-law-amendments-outlined/

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Protected Disclosures Act: More whistleblower cover

Act to cover workers and state employees…

whistleblowerWhat was expected has now arrived in the form of an amending Bill to the Protected Disclosures Act, or “Whistleblowers Act”, which will draw contract workers, independent contractors, consultants and agencies into the ambit of the legislation, as well as state employees and employers.

The draft is for public comment until mid July, such being called for by the proposers, the ministry of justice and correctional services.

In the first case, the term “independent contractors” will embrace protection for contract workers in terms of the Act together with the already described basic terminology of “employees”.   Secondly, the proposals clearly identify state employees who are working, or who have worked, for government and state utilities.

Much strengthening of the Act to protect whistleblowers is evident, including a procedure for disclosing unlawful behaviour in the workplace by both private and public sector employees and how such disclosure is to be protected.

Civil and criminal liability

The draft bill proposes that whistleblowing employees can approach the courts for relief in the face of detrimental behaviour shown towards them by employers and that they will be immune from civil and criminal liability flowing from a disclosure that reveals criminal activity. Also, the disclosure of false information by whistleblowers is to be regarded as an offence.

As a separate issue, the Bill now places upon the employer a responsibility to set up appropriate procedures for dealing with disclosures and to inform all employees and workers about such. Also there is a duty to investigate any protected disclosure. President Zuma alluded to these whistle blower safeguards in his State of Nation Address.

If occupational is proven in a court of law, then employers will then be liable for “detriment or victimisation befalling an employee” and there will exist a liability for compensation and/or damages to the employee or worker, the draft states.

Employee safeguards

The kinds of “occupational detriment” from which the whistleblower is protected is also described, such as being subjected to any disciplinary action; being dismissed, suspended, demoted, harassed or intimidated; being transferred against his or her will; being refused transfer or promotion; being subjected to a term or condition of employment or retirement which is altered, or kept altered, to his or her disadvantage; and being refused a reference, or given an adverse reference.

At the same time, the proposals define more clearly the “irregularities” described by the anchor Act to which whistle blowing can apply, these now being defined as criminal offences; failure to comply with legal obligations; miscarriages of justice; the endangerment of the health or safety of individuals; damage to the environment; and unfair discrimination.
Other articles in this category or as background
http://parlyreportsa.co.za//cabinetpresidential/logjam-has-to-be-broken-over-halted-state-information-bill/

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Minister Davies continues with IPAP 6

 IPAP equals “smart” industry…

The minister of trade and industry, Dr Rob Davies, before the elections, published his further Industrial Policy Action Plan (IPAP) with a theme of “smart re-industrialisation” taking South Africa to 2017.  He now returns to the same cabinet post to implement his proposals.

His department, DTI, talks in the document of integration of the region with both SADC countries and the continent as a whole, giving emphasis in SA on manufacturing rather than relying on commodity exports.

In presenting the plan, Minister Davies said the objective was to grow the economy; enhance manufacturing; and tackle poverty alleviation.    He said the new IPAP was aimed at the revitalisation of industry, with focus on competitiveness and the “labour-absorbing capacity of the manufacturing sector – especially in the traditional and non-traditional tradable and value-adding sectors of the economy.”

Tough times ahead

He warned that “ahead lay a tough, incremental process, during which there will be advances and setbacks” but he believed in the last five years the department of trade and industry (DTI) had placed the manufacturing sector in a much stronger position than before to take advantage of “emerging positive factors on the local economic scene”.
The minister said the latest IPAP has a guiding mission, which is to take South Africa’s potential for industrial growth to “greater intensity”; firstly with the infrastructure spend of R840bn over the next three years and also with localisation focusing on government procurement to support local manufacturing.    He called on all business and industry to support this process.

He named beneficiation as an important “driver” of the latest IPAP, moving away from dependency on export of primary commodities and developing its “enormous resource endowment by developing strategic partnerships in the burgeoning regional oil and gas economy.”     He said this would be a game changer.

Moving into Africa

As far as regional integration was concerned, Minister Davies said the new IPAP saw a move from primary and semi-processed products exported outside the continent, to the building of regional markets for a growing domestic manufacturing base and the manufacture of competitive products for global export.

To this end, he said, there had to be “accelerated development of a free trade area linking SADC in Central Africa with COMESA in the East.”

Minister Davies laid great stress on the need for the development of strong economic incentives for competitiveness, involving concessional industrial financing and mechanisms that promoted upgrading.    He said he saw the new Special Economic Zone (SEZ) incentives, building on the previous IDZs system, as a priority.

Customs catch up

Collective action by state institutions against the “illicit economy” – especially illegal imports – must be the subject of greater focus and action by government and DTI will continue to emphasize this, he said.

The minister continued, “We came into office in 2009 having lost a million jobs, 200 000 of those in manufacturing . . . and I think if we had not done what we have done, we would have been sitting here and talking seriously about the loss of industries across the board in this country.”

He added, “We have far too few black industrialists . . . and far too many people who are looking to go into business who are generalists; who are looking to any contracts coming from government and then subcontracting that to somebody else.”

The desire now, he said, supported by amendments to the Broad-Based Black Economic Empowerment Act and the associated codes, was to develop “deeper entrepreneurship” in the productive sectors of the economy.

Getting going

“This IPAP must belong to all of us”, minister Davies said, “from departments of state to the state utilities; from industry stakeholders and associations to organised labour and the academia”.    He concluded there was much to do in the next three years and “there was no room for complacency”.

He now returns in the new government to do just this.

Other articles in this category or as background
http://parlyreportsa.co.za//cabinetpresidential/ipap-focuses-on-jobs-to-beat-current-economic-problems/
http://parlyreportsa.co.za//cabinetpresidential/get-sadc-free-trade-agreement-right-first-davies-warns/

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Employment Equity regulations unexpected

Employment Equity Act surprises on race issues….

The reality of the Employment Equity Amendment Bill passed in Parliament last October is now beginning to kick in with the enforcement of the Bill by the regulatory process.   The Bill has now become an Act but the regulations are not what were expected on the race issue insofar as equity returns are concerned.

Oddly enough there were few objections or queries on the Bill when the draft Bill was presented for public comment by the department of labour (DoL) over eighteen months ago.  The legislation looked destined for an easy passage through Parliament but opposition party DA members appeared to be divided on a number of issues.

In an unusual turn of events, the Bill, when introduced into Parliament, allowed for foreigners whose applications for citizenship were turned down before 1994 on the basis of their skin colour and such persons can be included in employment equity (EE) returns in future.    This occupied much of the discussion in Parliament and MPs appeared to be relaxed that employment in terms of BEE would be regulated by DoL according to the demographics in the related areas.

Fines based on turnover

Fines were proposed in relation to turnover of the entity in question which could fall into eleven categories varying from agriculture to manufacturing, quarrying and mining to catering and transport and from wholesale, trade and commercial agencies to finance and business services.   Electricity, gas and water entities were mentioned, as were construction and community and personal services – all with total annual turnover thresholds given.

Most public comment in the parliamentary public hearings warned of criminalising business and strong objections were voiced on this issue.

Furthermore, the provisions of the Bill allowed for all white, Indian and coloured women who had been gender disadvantaged in terms of statutory law at any stage will also qualify for inclusion in terms of equity reporting.     The Employment Equity Bill was the third in a raft of four new labour bills presented to Parliament last year.

Business lagging in action

In its briefing to Parliament before the parliamentary public hearings, DoL suggested to parliamentarians that “business and industry has been riding roughshod over the law which had been unrevised for nearly 15 years and it was time now that provision was made in their budgets for considerably more than the negligible fines of the past.”

At the time of the Bill, it was assumed by most in the public hearings that the reference to “equity in terms of national or regional demographics” would mean that employers could set equity targets or make plans as called for in what could be interpreted as reasonable and according to the geographic area each company or entity was located.

The Bill said that “guidance would be given” on this provision by the DoL. The Bill was passed and became an Act with, as always happens, the regulations awaited – a matter then purely between DoL and the employer.

Race proportional representation

It appears from press reports that the regulations “giving guidance” on the issue of race demographics are a far more contentious item than the issue of the fines objected in the public hearings in Parliament.

The employment equity plan that each company must draw up, it is reported, now call in terms of the regulations issued for the targets to represent national demographics, not regional demographics as was expected, but still wherever the entity is of 150 employees or more wherever that entity is located.

It is unlikely that this matter will be debated in Parliament again unless a legal challenge results over the particular portion of the regulations concerned or the whole Bill is overturned constitutionally, which seems unlikely. Pressure on government to relax in general terms the consequences of new labour laws is coming from a number of directions.

Previous articles in this subject
http://parlyreportsa.co.za//bee/employment-equity-amendment-bill-looks-set-easy-passage/
http://parlyreportsa.co.za//labour/employment-equity-bill-criminalises-offenders/
http://parlyreportsa.co.za//bee/turnover-fines-employment-equity-breaches/
http://parlyreportsa.co.za//bee/court-ruling-equity-quotas-affects-bee/

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UIF brings in foreign workers

Changes to Unemployment Insurance Act with new Bill….

Nearly thirty changes are proposed to the Unemployment Insurance Act, governing the Unemployment Insurance Fund (UIF) in the form of the Unemployment Insurance Amendment Bill now tabled. Among other things, the Bill will qualify foreign workers for unemployment insurance benefits, as well as employees with learnership contracts.

In fact it is not quite clear whether Cabinet has approved the Bill for tabling in Parliament, no cabinet statement to this effect having been issued but the portfolio committee on labour has been briefed on the subject just before Parliament was closed.

It was stated that the Bill had been endorsed by Nedlac without any substantive amendments.

Aims of the Bill

The preamble to the Bill, which has not been debated, provides for “unemployment insurance benefits to learners who are undergoing learnership training and civil servants; to empower the Unemployment Insurance Board to provide in its constitution for the functions of regional appeals committees; to finance employment services and to adjust the accrual rate of a contributor’s entitlement to unemployment insurance benefits.”

On accrual issues, the proposed amendment will change the maximum accrual of 238 days to 365 days in a four year period. This will extend the period of payment of an unemployed contributor from eight months to twelve months. Beneficiaries will also accrue one day’s benefit for every four days of employment as a contributor.

 Payment period extended

The proposed amendment will change the maximum accrual of 238 days to 365 days in a four year period. This will extend the period of payment of an unemployed contributor from eight months to twelve months.    Beneficiaries will also accrue one day’s benefit for every four days of employment as a contributor.

The Bill also makes it quite clear that funds raised through the UIF process, other than money required to meet the current expenditure of the fund, must be deposited on behalf of the Fund with the Public Investment Corporation Ltd (PICC).

LegalBrief comment

Says LegalBrief, “The amendment will improve benefits from 38% – 60% to 45% – 65% in the various brackets. The amendment will also enable the minister to change or vary both minimum income replacement rate and the maximum income replacement rate without having to go to Parliament.”

“The present position is that the minister can vary the minimum income replacement rate only. Once the amendment becomes law the minister will simply use a regulation to vary either the minimum or maximum or both.”

A copy of the Bill as tabled in Parliament is available on the department’s website.
Previous articles in this subject
http://parlyreportsa.co.za//labour/labour-relations-act-changes-passed/

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New Employment Equity Act gives shock

Employment Equity regulations published…

menfolk  The reality of the Employment Equity Amendment Bill passed in Parliament last October, now an Act, is beginning   to kick in with the enforcement of  regulations which, of course, are extra-parliamentary. The recently published regulations are not what were expected on the race issue, insofar as equity returns are concerned.

Oddly enough there were few objections or queries on the Employment Equity Bill when the draft Bill was presented for public comment by the department of labour (DoL) over eighteen months ago and the legislation looked destined for an easy passage through Parliament.

1994 critical date

In an unusual turn of events, the Employment Equity Bill, when introduced into Parliament, allowed for foreigners whose applications for citizenship were turned down before 1994 on the basis of their skin colour and such persons can be included in employment equity (EE) returns in future. This occupied much of the discussion in Parliament.

Fines were proposed as related to turnover of the entity in question, which could fall into eleven categories varying from agriculture to manufacturing, quarrying and mining to catering and transport and from wholesale, trade and commercial agencies to finance and business services.  Electricity, gas and water were mentioned, as was construction and community and personal services – all with total annual turnover thresholds given.

Worry was criminalisation

Most public comment in the parliamentary public hearings warned of the Employment Equity Bill criminalising business and strong objections were voiced on this issue.

Furthermore, the provisions of the Bill allowed for all white, Indian and coloured women who had been gender disadvantaged in terms of statutory law at any stage will also qualify for inclusion in terms of equity reporting. The Employment Equity Bill was the third in a raft of four new labour bills presented to Parliament last year.

In its briefing to Parliament before the parliamentary public hearings, DoL suggested to parliamentarians that “business and industry has been riding roughshod over the law which had been unrevised for nearly 15 years and it was time now that provision was made in their budgets for considerably more than the negligible fines of the past.”

National demographics the decider

At the time of the Bill, it was assumed by most in the public hearings that the reference to “equity in terms of national or regional demographics” would mean that employers could set equity targets or make plans as called for in what could be interpreted as reasonable and according to the geographic area each company or entity was located.

The Bill said that “guidance would be given” on this provision by the DoL. The Bill was passed and became an Act with, as always happens, the regulations awaited – a matter then purely between DoL and the employer.

It appears from press reports that the regulations “giving guidance” on the issue of race demographics are a far more contentious item than the issue of the fines objected in the public hearings in Parliament.

Still applies to min of 150 employed

The employment equity plan that each company must draw up, it is reported, now call in terms of the regulations issued for the targets to represent national demographics, not regional demographics as was expected, but still wherever the entity is of 150 employees or more wherever that entity is located.
It is unlikely that this matter will be debated in Parliament again, since a legal challenge might only result in that particular regulation being revised – unless of course the whole Bill is overturned constitutionally, which would seem most unlikely.
Previous articles in this subject
http://parlyreportsa.co.za//bee/employment-equity-amendment-bill-looks-set-easy-passage/
http://parlyreportsa.co.za//labour/employment-equity-bill-criminalises-offenders/
http://parlyreportsa.co.za//bee/turnover-fines-employment-equity-breaches/
http://parlyreportsa.co.za//bee/court-ruling-equity-quotas-affects-bee/

Posted in BEE, Labour, Trade & Industry0 Comments

Infrastructure Development Bill possibly to be altered

Infrastructure Development Bill gets SALGA, BUSA criticism….

The Infrastructure Development Bill, tabled in Parliament during November 2013 just before Parliament closed, has had three days of public hearings, the Bill being an empowerment document for the presidential office to realise the New Build programme for South Africa.

The Bill was published for comment and the hearings over three days represented by an early opening of parliamentary portfolio committee activity. The Bill was tabled by minister of economic development, Ebrahim Patel.

The majority of those presenting before Parliament with submissions regarding the Bill, mainly state utilities and entities such as the Institute of Municipal Engineers, pointed to what many realise is the actual crisis facing South Africa – that of lack of skills at local government level and a lacking of will to get projects even underway, let alone completed, being the main hurdles.

Objectives of Bill

According to the cabinet statement released at the time, the Bill aims to:

•    Implement integrated projects of significance for South Africa and the region
•    Promote public-private partnership making use of private sector skills
•    Set up steering committees for each project
•    Put in place time frames for implementation of strategic integrated projects (SIP)
•    Address project management and regulatory delays challenges
•    Ensure coordinated issuing of permits and licences

The Bill pledges support for the Presidential Coordinating commission (PICC) set up by cabinet in July 2011 to bring together the three spheres of government to drive increased levels of infrastructure development. A number of bodies presenting gave examples of the complete lacking of any knowledge of the maintenance of national assets, particularly an infrastructure project was completed and handed over.

SIPS are to be driven by PICC

PICC interventions will be carried out, it is planned and a number of the presentations to Parliament will go to the PICC as examples of where cross-cutting and mobilisation across all levels of government is badly needed with specific regard to the 18 Strategic Infrastructure Projects (SIPs) identified by the Commission.

Each SIP comprises a large number of specific infrastructure components and programmes. Such infrastructure development is seen as a key jobs driver in the new growth path planned for the country. The new Infrastructure Development Bill is thus the anchor document behind the presidential process, even as far as allowing for the acquisition of land where an SIP may require this option.

Environmental issues “ignored”

In contrast, the constitutionality of, and the need for the Infrastructure Development Bill was questioned in a presentation by the South African Local Government Association (SALGA) who clearly felt “toes were being trodden upon”. University of KwaZulu Natal warned that a clause in the new Bill imposing that any delay process that goes over 250 days will be over-ridden was totally discounted on the basis that an environmental impact assessment cannot be completed within 300 days.

Also Business Unity South Africa (Busa) whilst agreeing with the whole idea of the need to get projects going expressed the view that rather than trying to ‘cut through’ through bureaucratic problems that might be causing delays, the new Bill may add yet another layer of red tape on government project managers and confuse the roles and responsibilities of the three spheres of government.

They cautioned that the department of economic development, with all the goodwill in the world, may add confusion and further congestion and that no amount of legislation could add value to the actual problem; lack of skills at local government level and an inability of one department to talk to another.

Bill driven by ANC to empower PICC

Lack of consultation in the preparation of the Bill was also cited as having been insufficient on the bill but the Bill is known to have the support of the ANC, service delivery and infrastructure build projects that create jobs being their manifesto promise.

COSATU, Telkom and Transnet were all in favour of the Bill in broad principle but most expressed concern that the Bill might add rather than detract from bureaucratic delays and great care that this did not happen, they said.

Telkom also raised queries with regard to the granting of rights to PICC to expropriate land but minister Ebrahim Patel, minister of economic development who was present for most of the submissions, chose not to debate the issue presumably because such matters were separately under debate with other legislation.

There was little disagreement amongst opposition members that minister Patel would have to make considerable revisions to the Bill as presented, particularly on the issue of land acquisition in terms of existing law.

Further reports on this Bill in later meetings have been published for clients and will be posted on this website in due course
Previous articles on this subject
http://parlyreportsa.co.za//cabinetpresidential/infrastructure-development-bill-legislates-growth-path/
http://parlyreportsa.co.za//cabinetpresidential/infrastructure-development-bill-to-cut-red-tape-2/
http://parlyreportsa.co.za//energy/global-shockwaves-must-not-stop-infrastructure-programme/
http://parlyreportsa.co.za//uncategorized/president-zuma-calls-for-2012-as-year-of-infrastructure/

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Equity quotas court ruling affects BEE legislation

Employment equity quotas as numbers only struck down….

On equity quotas, the Employment Equity Act, as anchor legislation, and thus the recently approved Employment Equity Amendment Bill, has come under query as a result of a recent case heard in the Supreme Court which has found the Act is in default where numerical formulas only are applied to racial quotas in order to comply with regulations.

In fact numerical quotas are illegal, said the Court. In dealing with case before it, the Court found that this had been applied, the appellant failing to achieve an appointment based the fact that racial quota targets had been applied in terms of black empowerment legislation.  The defendant was the minister of police.

The court further found the Act in contradiction of itself by being unfair if it regulated itself to achieve employment equity with just numbers, as distinct from “preferential treatment and numerical goals” being applied, as has been applied in government circles elsewhere.

A whole host of applications applied by many government departments would therefore seem to be in contravention of the Act, since many departments rigidly use number quotas to achieve equity targets across a wide range of the public service.

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Treasury proposals on debt control approved

Tough measures on debt approved by cabinet….

squeeze To counter what is feared in some quarters as a minor debt “bubble”, as occurred in the United States and set of a major run on banks, National Treasury have had approved by cabinet tough proposed measures to assist over-indebted households and prevent consumers from becoming over-indebted in future.

A number of ministers have supported Pravin Gordhan’s observations, stated in his Medium Term Budget Statement, that the curbing of reckless lending is a priority for government. Growing debt issues in middle to lower income groups has been an issue with rating agencies.

Over-debtedness the issue

Despite fierce opposition to a credit amnesty earlier, which was perceived as simply contributing to such a “bubble”, the measures that were approved by cabinet recently include an “immediate set of comprehensive steps” to tackle over-indebtedness in lower and middle income situations.

Such measures include insisting on affordability criteria in place for retail lenders and prohibiting reckless loans; ensuring that the provision of credit is suitable for each circumstance and reviewing National Credit Act pricing caps; there will be a “strengthening of regulation and enforcement to prevent unregistered credit providers and a review the regulatory framework for credit insurance policies.

The expression “controlling access to the payment system” was used.

Whole household approach considered

Government is also considering providing assistance to households labouring under a debt burden. No details emerged on this particular issue but some of the proposed measures included steps include reducing borrowers’ installment burdens; the setting up of voluntary debt relief measures within major lenders and regulating debt-collection firms.

Most importantly, employers will also be encouraged to investigate the legitimacy of all emolument attachment or garnishee orders in force against their employees. Treasury says such measures will be implemented within the public sector early next year; the department of trade and industry working with Treasury.

Posted in Cabinet,Presidential, Finance, economic, Labour, Trade & Industry0 Comments

Home Affairs fails on most targets

Department getting just about nowhere…

sa passportDepressing figures and equally depressing facts emerged from the annual report of the department of home affairs (DHA) to Parliament this year in the light of, once again, a qualified audit report and some pretty sad performance figures against targets where only 100% achievement is recognised.

Mkuseli Aplieni, director general, DHA, was responsible for the reporting but he was supported by neither the minister, Naledi Pandor, nor the deputy minister, Fatima Chohan. The DHA claimed that its mandate was to maintain the national population register; to manage effectively all immigration and to “develop state and civil society partnerships in support of service delivery and security mandates.”

Aplieni said DHA had “reasonably and efficiently” facilitated large volumes of immigrants and visitors through ports of entry thus supporting large international events and the tourist industry; it had “largely” eradicated the backlog of temporary residence permits and there were some efficiency gains in deportations of illegal migrants and in the adjudication of asylum seekers.

100% achievement, nothing less

DHA had 50 target areas and had partially achieved these at between 41% and 99% of targets. A target achievement requires 100%.  DHA had however managed to refurbish 19 offices, and fill 60% of vacancies, and this was making gains on the strategy to bring DHA closer to the people, Aplieni said.
However, he told Maggie Mauyne, chair of the portfolio committee on home affairs, the DHA faced major challenges in managing a complex and dynamic immigration environment, as well as in aligning and strategically managing the planning and budgeting cycle with staff shortages.

Slow start to ID smart cards

He said the pilot project for providing smart card IDs was tested with 100 cards although it was noted that this would be a long-term project running over the next six to seven years. Smart card development would require three years to develop and then another six to seven years to issue the cards to 38 million ID book holders. This process could not be rushed, he said.

E-permitting and visa system specifications had been approved in quantity and finalised in the meanwhile, Aplieni said. In general however, 100% of ID duplicates for clients coming forward were resolved within 12 weeks but the challenges remained of duplicates and corruption surrounding IDs.

Residence permit backlog better

The backlog of temporary residence permits had been largely eradicated, he said, but there were still problems with the need for speed on permanent residence permits, although a special committee had been established to deal with them and the backlog.

In answer to questions on this subject, Aplieni said there were some basic problems with the temporary residence permit procedure in terms of legal procedure on a number of applications already received recently as well as the backlog that had built up.

The DHA, he said, had to focus on new temporary permits first but a committee had been set up to deal with the backlog and by November 2013 much of it should have been resolved. A committee of five people had been dedicated to dealing with this problem.

Can’t get to grip with computers

In terms of fighting against corruption, a draft concept paper was reported to be under consideration, specifically on the role of DHA in fighting corruption and strengthening the security of identity and immigration systems. DG Aplieni reported that the Auditor-General (AG) had not issued an unqualified audit report in this year and this was mainly because DHA partially because remained challenged with the IT systems.

Opposition members noted that the “burning issue” was the question of leadership in the department and even the internal auditing team was not doing its work properly. One ANC said that as the DHA was a security department, the issue of corruption was a matter of national security when it came to illegal or undesirable people likely to use the corruption that existed to secure their stay in the country. This was viewed as a serious threat to national integrity and security,let alone the problems noted by the AG.

Still leadership problems

DG Aplieni explained that there was in fact a structure of communication and meetings in the DHA. He accepted that there was some poor management arising from the fact that the Chief Operations Officer (COO) post was not filled and the DHA was seeking someone to appoint in that capacity. The COO would assist the DHA in monitoring and ensuring that the DHA was effectively and adequately operated and this would be a centre of communication in future leading to much better management of such issues.

He also explained that the President’s target for 50 000 foreign workers was onerous but the DHA was doing all that it could to reach that target.

Getting to grips with corruption

Again, concerns were also raised about corruption within the department and the subject was raised by MPs of home affairs employees who did not declare their private businesses. MPs complained that there was a “culture of corruption” within home affairs and asked DG Aplieni what measures were being put in place to discourage malpractice and detect bribes.

It was quite difficult for the DHA to detect staff who did not declare their businesses, he responded. The DHA had as much information as was declared by employees from a form setting out the declaration of their assets, but it was impossible to know of those who had not done this or who had done it properly. It was even more difficult for DHA to go to the Companies and Intellectual Property Registration Office to investigate businesses that might be owned by employees or their spouses.

Back to IT vacuum

On the high vacancy rate, Aplieni said that the DHA faced certain challenges with employing people who were experienced in the IT field. Given the complexity of the work at the department there were many other positions that needed qualified people for DHA to achieve their objectives and targets and many posts stood vacant..

On the question of corruption, DG Aplieni said that the DHA did have disciplinary measures in place although “it took the issue of discipline seriously”. An employee could not be dismissed without the matter proceeding along the right lines. If there was a challenge and the matter went to court, that court action had to be allowed to run its course. He said that the Labour Relations Act and unions protected workers against dismissals. Whilst the matter might be before a court, an employee in question would be working and, eventually would be paid.

Foreigners entering

An ANC member expressed her concern around the fact that South Africa was not aware of the exact status or numbers of illegal or temporary foreigners in the country. She wanted to know what the DHA was doing to ensure national security and to prevent Kenyan terrorist-style attacks.

The response from DG Aplieni was that higher standards at ports of entry, DHA said, were not yet finalised although a draft concept paper on strengthening security of systems had been begun and was in process.

MPs asked for comment from the DHA on the woman who had been involved in a terrorist attack, who was claimed to be a South African. Aplieni said that this particular person, Samantha Lewthwaite, who might have been involved in the terrorist attack in Nairobi, was able to enter and leave the country without being detected or tracked down. DG Aplieni explained that the Department of Home Affairs in fact had compelling evidence that she was not using a South African passport.

No fingerprinting at borders

On border management and the question of undesirables entering the country, DG Apleni reminded the committee that no fingerprints were taken at border entry posts, although DHA was now at last included on the national security committee with South African Police Services and defence department.

On deportations of those staying illegally in South Africa, human rights activists sought judicial remedy which was expensive or embassies did not collaborate. This problem had to be solved at ministerial level, he said.  DHA was at the moment engaged in exhausting all judicial remedies available on the problem.

Refer to articles in this category
http://parlyreportsa.co.za//cabinetpresidential/business-interests-bill-to-control-corruption-with-tenders/

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Employment Equity Amendment Bill set to pass

Foreign labour gets look in….

legalIn an unusual turn of events  the Employment Equity Amendment Bill  allows for foreigners whose applications for citizenship were turned down before 1994 on the basis of their skin colour and such persons can be included in employment equity (EE) returns in future. Furthermore, all white, Indian and coloured women who had been gender disadvantaged in terms of statutory law at any stage will also qualify for inclusion in terms of equity reporting.

The next debate will possibly include a vote, the Employment Equity Bill being the third in a raft of four new labour bills presented recently to Parliament.

More of the same

The new EE Bill prohibits unfair discrimination in the workplace; regulates for the implementation of employment equity plans; gives more powers to labour inspectors; increase fines for non-compliance on equity issues for business; and ring fences such funds into a nominated national revenue fund.

Contraventions of some ten sections of the new Bill result in fines have a maximum penalty of R500,000 in cases where there are no previous convictions, to R900,000 in the case of four previous convictions in respect of the same offence within a period of three years.

Turnover based fines

Fines are, in fact, to be related to turnover of the entity in question, which can fall into eleven categories varying from agriculture to manufacturing, quarrying and mining to catering and transport and from wholesale, trade and commercial agencies to finance and business services. Electricity, gas and water are mentioned, as is construction and community and personal services – all with total annual turnover thresholds.

Other than a query from MPs to define further what constituted a “test” in terms of proposed provisions for regulations for psychometric evaluations to be carried out by the Health Professions Council, there were few objections or queries on the Bill when presented by DOL and the legislation looks destined for an easy passage through Parliament.

Refer previous articles in this category
http://parlyreportsa.co.za//bee/turnover-fines-employment-equity-breaches/
http://parlyreportsa.co.za//labour/employment-equity-bill-criminalises-offenders/
http://parlyreportsa.co.za//bee/rumblings-in-labour-circles-on-bee/

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