STATEMENT BY MINISTER TITO MBOWENI, MINISTER OF LABOUR ON THE OCCASION OF THE BUDGET VOTE 21: LABOUR. NATIONAL ASSEMBLY. CAPE TOWN. 19 MAY 1997.
Madame Speaker, Honourable Members,
This debate on our budget vote gives us an opportunity to reflect on our work and the challenges which we continue to face. We do so within the context of our publicly stated objectives and timetables in the Five Year Programme of Action 1994-1998. Our current budget therefore is intended to facilitate the implementation of this programme.
The government as a whole faces major tasks before it. We have to undo the injustices of the Apartheid system, whose horror stories continue to be told on a daily basis at the Truth and Reconciliation Commission. These tasks cannot in reality be completed in a few years for the damage was done over many decades and indeed over many centuries. The critical issue for us is that on an hourly, daily, weekly, monthly and yearly basis, we have to be hard at work, laying the foundations for continuous processes of change and progressive transformation. Achieving a better life for all is therefore not an event but a process. That process has been joined by this first democratic government.
We claim no monopoly of wisdom in effecting these revolutionary changes. Thus during this debate, we hope to listen to the views of other Honourable Members on how we can continue to march forward with these changes. However any advice which is intended to take us back to the Apartheid days in disguise is not going to find any receptive ear from our side. Our determination is to change South Africa and not to make the consequences of Apartheid more bearable to our people.
We are therefore looking forward to a healthy and rewarding debate.
As indicated in our Programme of Action, the concrete programmes of the Department would be realised through certain legislative enactments, the building and transformation of labour market institutions and the convening of commissions and task forces whose recommendations might lay the basis for the formulation of labour policies and laws.
The resulting programmes and policies of the Department have been developed and implemented in full cognisance of the many and daunting labour market problems that we face, namely, the high rates of unemployment and under-employment; the low rates at which productive employment opportunities are generated in the economy; the pervasive poverty among non-working and working people of our country; the extreme degrees of inequality with respect to income and access to income generating assets; the low levels of education and skills, the still tense labour relations environment and the challenges of the southern Africa jobs market.
We are acutely aware of the fact that in the minds of some, the foregoing problems are seen to emanate from the nature of the labour market, and consequently labour market polices and programmes should be the main solution to these. I should state at the outset that we think that such perceptions are misleading for they ignore the more fundamental causes that lie outside the purview of labour market policies. For instance, it is quite erroneous to believe that the task of employment creation lies squarely with the Ministry of Labour as some would have us believer. Our role is only one aspect of a complex array of economy-wide initiatives to employment creation which are being addressed jointly by government departments which as well involve the public sector generally, organised labour and the private sector as well.
In this respect our mission is defined in the context of the larger national vision of government aimed at promoting democracy, striving for full employment, and promoting economic development and growth and international competitiveness.
Our mission, therefore has been defined as the following:
The above objectives are justified as we attempt to deal with the fragmented nature of the labour market and the diverse nature of its problems and by the need to resolve inherited labour market inefficiencies. In this context, ours is, and will be an unending task of attempting to achieve efficiency and equity concerns within the labour market.
The past year has seen us continue to realise our goals as spelt out in the Programme of Action. On the legislative front key developments have been the implementation of the new Labour Relations Act, the release of the Green Paper on Employment and Occupational Equity, progress in drafting and negotiating the Basic Conditions of Employment Bill, and the launch of the Green Paper on Skills Development. We have also established the Commission for Conciliation, Mediation and Arbitration, the Labour Court and the Labour Appeal Court as part of the system of dispute resolution created by the new Labour Relations Act.
Institutionally, the Department embarked on a major exercise aimed at restructuring and re- positioning itself which culminated in the finalisation of the Department s Strategic Management Plan. Apart from refining the vision and mission of the Department, this Plan has also incorporated major recommendations on the institutional and organisational transformation of the Department in addition to the reprioritisation of its activities. Further, investigations by task teams on the restructuring of the Occupational Health and Safety Competencies and the Unemployment Insurance Fund have been completed.
The Department has continued to ensure that South Africa lives up to its international and regional obligations by participating in the various fora such as those of the International Labour Organisation (ILO), the Southern Africa Development Community (SADC) and the Organisation of African Unity (OAU). With respect to the former, we have ratified, Conventions No. 29 and No. 105 prohibiting forced labour and Convention No.111 prohibiting discrimination in employment.
With respect to capacity building of stakeholders the Department has assisted in the establishment of the trade union training institute, DITSELA as part of its programme to strengthen civil society. Assistance from this programme was also given to IMSSA, the SA Labour Bulletin and the Industrial Health Unit.
More fundamentally perhaps, have been the accomplishments at the policy front. The report of the Comprehensive Labour Market Commission, whose intent had been indicated in the Programme of Action, and which was established in 1995, was presented to government during the past year. This Commission has made some far-reaching recommendations with regard to labour market policy as its mandate required. The recommendations of this Commission have been analyzed by the Department and within government and have generally been accepted with some modifications and qualifications where needed. These have been the basis for the preparation of the consolidated labour market policy document which we will be publishing soon.
For the 1997/1998 period, the Department has been allocated a budget of R620,47 million.
The Department will accommodate its planned activities for the 1997/1998 period within the context of this budget. The main activities in this respect encompass legislative, policy and institutional initiatives.
The Department will be presenting to parliament three new bills: Employment and Occupational Equity, Basic Conditions of Employment and National Skills Development. Every attempt will be made to minimise the creation of new institutions and bureaucratic infrastructure except where it is absolutely necessary for the effective implementation of those laws. In this respect efforts are being made to re-structure and re-orient existing institutions to perform new functions as required. Whatever additional resources are required in relation to these laws will be dealt with within the context of the 1998/1999 budget.
We trust that whatever difficulties are experienced in negotiating the foregoing bills with our negotiating partners, these will be navigated through expeditiously, and that every effort will be made to reconcile the varying and conflicting standpoints on some of the issues related to the above bills. But as I have said elsewhere , we have a task to govern and as such we should not allow ourselves to be unnecessarily distracted in the accomplishment of these tasks.
Honourable Members, may I take this opportunity to inform you of the government s response to the recommendations of the President s Comprehensive Labour Market Commission and to announce our approach to labour market policy.
The Commission presented its findings and recommendations to the President in June 1996 in the form of a report entitled Restructuring the South African Labour Market accompanied by a background report undertaken by the International Labour Office (ILO) entitled Restructuring the Labour Market: The South African Challenge - An ILO Country Review.
The Commission recommended a framework for labour market policy that promotes economic growth while also creating secure and reasonably remunerated employment, the basic conditions of which are subject to statutory protection, including protection against unfair discrimination.
It called for the harmonisation of labour-market policies with macroeconomic and industrial policies in a manner that is mutually reinforcing and sustaining to underpin economic growth and employment creation. In this respect, the Commission recommended that the President should convene a Jobs Summit to facilitate an Accord for Employment and Growth that would commit social partners to stabilising prices, wages and other economic indicators and to developmental initiatives at the national and regional levels.
In this context, the Commission recommended that policies should aim at strengthening collective bargaining and protecting workers in a manner that promotes economic growth and job creation. In the view of the Commission, measures related to the promotion of affirmative action and employment equity, wage determination, and productivity enhancement based on participatory and self-regulatory approaches, flexibility and variation within the context of parameter rules regulated by the government should be pursued.
The Commission called for a Social Plan which will act as both a safety net and a developmental initiative to rehabilitate communities grossly affected by the decline in economic activities as a consequence of restructuring.
The Commission also called for a rationalisation of migration policy in accordance with international conventions and recommendations and human rights norms and the liberalisation of migration policy in accordance with the move toward increased regional integration. These measures should help to provide the skills required for more rapid growth and development.
The substance of the recommendations made by the Commission is in general compatible with the overall approach to government policy.
Honourable Members, I would like to focus, if I may, on the recommendations for enhancing employment which centre on the need to co-ordinate labour policies with strategies for economic restructuring. We propose to foster this co-ordination through a process that will lead to the formulation of an employment strategy, and on the basis of which the Jobs Summit with the social partners will be held.
Background research for the formulation of the Employment Strategy has been completed. This research investigated the constraints and potential for employment promotion in the various sectors of the economy with a view of informing us on the nature of the Employment Strategy needed to create more jobs. The research findings are being used as the basis for the preparation of an Employment Strategy which will be submitted to Cabinet for consideration in due course. This strategy is being prepared as an inter-departmental initiative among key relevant government departments.
The Employment Strategy once completed will be the basis for consultation with social partners leading to the Presidential Jobs Summit which we target to hold in October 1997. It is hoped that at this Summit government together with the social partners will commit themselves to specific actions intended to promote employment in a manner that is quantitatively and qualitatively different from what has been the case so far. Details of this initiative will be announced at a later date.
May I also indicate to the Honourable Members the organisational and financial implications of the Commission s recommendations.
The major organisational and personnel implications relate, first, to the need to establish, within government, formal mechanisms for the co-ordination of macro-economic, industrial and labour market policies; the implementation of a Social Plan; and the administration and monitoring of the Accord. More specifically, in this respect will be the need for substantial co-ordination and consultation between government departments with regard to the development of the Employment Strategy and the consultative process leading up to the Jobs Summit.
Second, with respect to the Department, they relate to the need for administrative and monitoring infrastructure to implement employment equity; the need to restructure and adequately fund the National Productivity Institute; and the need to develop a capacity for the formulation and monitoring of labour market policy and the maintenance and dissemination of labour market information and statistics.
The major financial implications of the acceptance of the recommendations of the Labour Market Commission for government as a whole relate to the direct (in terms of subsidies) and foregone (in terms of tax breaks or holidays) resources needed to implement supply-side measures to under-pin employment promotion and the resources needed to finance the Social Plan.
With regard to the Department of Labour every effort will be made to accommodate new programmes through utilisation of existing structures and the reprioritisation of existing programmes in line with the budgetary allocations within the context of the medium term budget programme of the government.
In closing, allow me to comment on the current and future thrust of labour market policy which is the synthesis of the main contents of various documents that have emanated from government and the Department over the past three years.
The policy intentions of the Department were initially spelt out in the Ministry s Programme of Action: 1994-1998 and have been expressed in the Green Papers that have been published by the Department on Employment and Occupational Equity, Employment Standards, and Skills Development and in the content and thrust of the new Labour Relations Act. More importantly, our policies have now found their motivational basis and overall coherence from the work and recommendations of the Comprehensive Labour Market Commission and the associated background work of the International Labour Organisation, and from the Strategic Management Plan of the Department.
It is recognised that labour market policies have to be an integral part of a package of broader polices aimed at resolving many of the problems manifested in the labour market but not necessarily and primarily caused by the labour market.
In light of the above Labour Market Policy will be guided by the following principles:
The strategic approach to the labour market will entail the following:
Needless to say, this policy direction has benefited from consultation within government and with social partners, and from the extensive comments in the media and in the form of written submissions from the public that accompanied the various documents that have informed its contents and policy direction.
May I finally underscore the fact that this is the overall policy direction which reflects government's own position on labour market policy issues. This position has been arrived at in full cognisance and appreciation of the range of views that have been expressed on the various matters of concern. Nevertheless, the policy stance taken on labour market issues represents the considered opinion of the Ministry of Labour, in the interest of society at large, rather than those of any special group, in the hope of making our contribution towards achieving A Better Life for All! during this era of transformation and beyond.
I thank you.