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DA: Statement by Sej Motau, Democratic Alliance shadow minister of labour, on the impact that the labour law amendments will have on jobs (29/03/2012)

29th March 2012

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I will today extend an invitation to the Minister of Labour, Mildred Oliphant, to meet with me at a time and place of her choice to discuss the potential economic impact of the Basic Conditions of Employment Amendment Bill and the Labour Relations Amendment Bill.

I am concerned about the lack of certainty around the impact that these bills could have on job creation in the South African economy. The Minister must conduct a regulatory impact assessment (RIA) on these bills before the upcoming Parliamentary discussions. Our consultation process in Parliament needs to be informed by proper research into the economic impact of these bills. I want to meet with the Minister to discuss the possibility of initiating such an RIA before the Parliamentary process kicks off.

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It is clear that the bills may increase the regulatory burden related to new appointments, thus affecting the cost of business and ultimately discouraging job creation. As in most such cases, there is also very likely to be unexpected knock-on effects that could damage our economy.

An RIA completed by the University of Cape Town in 2010 suggested that as many as 2.13 million temporarily employed South Africans’ jobs could be jeopardised if the bills were implemented in their original form.

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Significant changes have been made to the bills since then, but no new RIA has been conducted to determine the impact of the bills in their revised form.

The Minister’s intentions with these bills – to protect the rights of contracted workers and workers employed by labour brokers – are admirable. But the broader consequences for the unemployed also need to be considered.

It is critical that the legislature and Minister understand how many jobs will be jeopardised by the bills. As it stands, the Minister seems to be shooting from the hip without any economic evidence to back up the rationale for the current amendments.

When the public participation process around these bills comes to Parliament, I will endeavour to amend the bills to be more employment-friendly. An RIA will likely produce the evidence to back up the need for employment-friendly amendments.

The Minister has to explain why the significant problems highlighted in the previous RIA seem to have been ignored in the drafting of the latest version of the bills.

I want to meet with the Minister to discuss these matters and will use all possible parliamentary channels to ensure that job creation is not jeopardised by the labour bills due to failures by the Department of Labour to consider their long-term impact.


 

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