Issued by: Office of the Deputy President
27 August 1999
Honourable Minister
Chairperson,
Members of the Nedlac Executive Council,
Ladies and gentlemen
As we all know NEDLAC was established in 1995 as a tool to promote the goals of economic growth, participation in economic decision-making and social equity.
NEDLAC is made up of organised formations of our society - i.e. government, trade unions, employer organisations and community representatives - the question can then be asked: have we worked "jointly and severally" to promote these noble goals?
Certainly we have worked together to finalise pieces of labour and other legislation and have secured what we South Africans so fondly refer to as "sufficient consensus" on some issues. We worked together to produce arguably NEDLAC's proudest achievement to date: the Presidential Jobs Summit Declaration. The answer to the above question, however, cannot be a resounding yes.
After months of work and hours of deliberations a truly impressive array of projects were planned and undertaking entered into: the projects ranged from integrated provincial spatial development initiatives and housing to special employment projects for the youth, women and people with disabilities. The agreements included the Social Plan and commitments to hold sectoral summits.
The success of these summits should in no way be undermined - for the first time in our country all social partners sat together and deliberated on ways to contribute to job growth.
As a direct result, South Africans in many different places have begun to enjoy improvements in the quality of their lives. The Greater Algoa are is a case in point. New plants are being built there that will provide employment opportunities. There is a plan to train young people to build access ramps to public buildings. The Lubombo and Wild Coast SDI's are also proceeding well and there rural communities will soon begin to see the fruits of these initiatives - in the form of jobs and markets. These are just some of the success stories.
The Business Trust has been formed from commitments made by a wide range of employers and major projects in the tourism industry are about to commence as a result. Some 6000 people will be prepared for formal sector or self-employment under leaderships. A significant increase in inward tourism is expected to follow the increased tourism marketing.
On the 3rd of March this year, trade union members across the country contributed a day's pay to form a job creation fund. A trust has been formed and projects will soon be operational. The Jobs Summit resulted in a number of government funded special projects receiving renewed support, such as the Working for Water Initiative and the SMME mentorship scheme.
NEDLAC can be rightly proud of the new commitment to job creation that was achieved in this process. However, the question must be asked - could the process have been taken further, indeed should it have been taken further? Most people would agree that some of the most contentious issues were put on hold pending further consultation. These include productivity and macro-economic policy. Issues around economic restructuring and the rights and obligations of employers and employee in relation to such labour market issues as "dismissal for operational reasons" also need further consultation.
These are fundamental issues, which must be resolved if the mandate of NEDLAC is to be fulfilled - as they go to the very core of "economic growth, participation in economic decision making and social equity".
People have tended to interpret "participation in economic decision making as limited to the process of influencing law-making. With the fundamental overall framework now in place, the focus of the debate on social partnership needs to shift to other areas, for example, the issue of productivity.
There are very complex issues that require extensive consultation and commitment from all the parties concerned. The greater economic gains to be made from a win-win situation far outweigh individual sectoral gains. Success in reaching agreements has positive implications for all concerned. A deal on productivity, for example, will translate into improvements in employment security, wages and working conditions. Similarly this will result in improved investments in new skills, technologies, and work organisation with a resultant increased market share and competitiveness.
The Jobs Summit was an important accord, but a lot remains to be done. The hard bargaining on the difficult issues must now begin in order to complete the accord. "Participation in economic decision making" must now move to the next phase - where the "real bargaining" begins!
The challenge for NEDLAC is clear. The "hard" issues need to be put back on the table and solutions need to be urgently found if our country is to grow and prosper and if we are indeed to become "a nation at work building a better life for all". I challenge this leadership to secure this new "tough employment accord" not later than the NEDLAC summit of May 2000!
Nowhere is the urgent need for such an accord more evident than in the public sector.
There needs to be consensus on balancing the issues of social programmes and individual needs. All social partnerships need to form a "smart partnership" towards a common goal of social upliftment and a better life for all.
Of course, we all agree that employment creation cannot be achieved through labour market management alone. Getting the mix of labour market, industrial, development and macro-economic policies right is fundamental to job growth. South Africa's input into the World Trade Organisation is no doubt as important as productivity for employment. Our President, in his state of the nation address, identified the need to ensure that interest rates do not choke off investment and growth.
Investment is key to economic and employment growth and social development - be it domestic or foreign. The announcement by the President of a new International Investment Council is vitally important here.
This Council, with its four Working Groups bringing government together with big business, the black business sector, commercial agriculture and the trade unions seek to ensure that South Africa is an attractive destination for foreign investment.
The Council and its Working Groups will complement the work of NEDLAC by looking to strategically position South Africa in key areas. It will meet relatively infrequently and will be a vehicle for high-level decision-makers to communicate directly with the Presidency.
Issues arising from these interventions may even be referred to NEDLAC for elaboration, resolution and implementation.
Investment in skill development and broader human resources will remain a vitally important complement to other investment initiatives. Raising our skill base is a vital pre-requisite for improving overall productivity and innovation in the economy.
Without the requisite skills, firms are unable to apply technological improvements and so are unable to enjoy the full benefits of any technological investments they make - hence discouraging them from making future investments. The continued shortage of skills is likely to dampen foreign investment and slow down domestic production of more value added goods and services.
The successful implementation of the Skills Development Act, the Schools Act, the Further Education and Training Act and the Higher Education Act are all key to achieving this outcome. Social partners have a vital role to play in this regard, most immediately through ensuring the success of the proposed Sector Education and Training Authorities and levy/grant systems and more generally by supporting broader educational innovations. Success in this area will certainly complement a wide range of other growth-enhancing interventions.
Whilst I have highlighted a number of areas where opportunities for advancement and improvement lie, I wish to conclude by observing that there are also areas where simply celebrating our achievements will do much to allay fears and transform prevailing negative perceptions. I think that labour market policy is an important case in point. A lot of effort has been put into the formulation of labour market policies which, on average, enjoy considerable support from the leadership of organised constituencies involved in their formulation. However, this enthusiasm is not shared by all - and these negative perceptions are impacting badly on our labour market and investments. We need to market our agreements more aggressively and implement them more expeditiously, so that more efficient outcomes are achieved and our detractors are silenced. Surely the responsibility that democracy brings includes and obligation on those who have entered an agreement to persuade their constituency of its merits. Let us dispel the victim mentality that someone else has imposed an outcome on us - let us own the products of the NEDLAC process publicly and proudly.
In conclusion, Chairperson, I share our President's view that "we are on course" - but I urge that we do not veer off course simply because we lack the stamina, bargaining maturity or determination to pursue matters to a successful conclusion. There are numerous challenges ahead in the immediate conclusion. There are numerous challenges ahead in the immediate future, agreements on job creation strategies and frameworks being a key issue. Let us pursue these agreements and accords with all the necessary vigour and patriotism. Let us put South Africa first.