Tag Archive | National minimum wage

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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