Labour: Minister's Budget Speech


12 Apr 2010



Budget Vote Speech by the Honourable Minister of Labour, Membathisi Mdladlana (MP), Parliament, Cape Town

                                                                                                             13 April 2010



Honourable Speaker
Honourable Members of Parliament
Distinguished Guests
Ladies and gentlemen
Fellow South Africans


Ziyalila iinkedama, bayajweda bembhombholoza abahlolokazi, bayangqukruleka abahlolo, bonke bexhalatyiswa kukungaziboni iziphumo zenkululeko esiyikhumbulayo kule nyanga kaTshazimpunzi.

Ukuzoba kakuhle uLMS Ngcwabe oku kukhala zome:

Ingoma yenkedama

Ngathi wemka nokonwaba;

Namhl’iingxaki yindyikityha

Neenkathazo ngumdolomba

Buya, mama, buya”

Sasikhwaza ngamazwi amakhulu sisithi “Mayibuye! I-Afrika!” Bayabuza ke abasebenzi beli lizwe ngakumbi ezifama ukuba ide ibuye nini na kubo le-Afrika. Ngoba bona bavuka ngonyezi baqhuqhe bexhinile bethobele ukukhonza. Betsho ngezo zifutyana zithe ga ngaphandle, benxibe ezo mpahla zingamadlavana, ilanga lithe nka, loo mabunzi ezizithukuthuku. Iinyawo zabo zilele intsente, iintamo zigqolile zixel’ekaxam, izisu zithe nca emqolo yindlala. Batyatyekwa ngezithuko imihla nezolo, balulame bazole bangathethi.

Anisiva na esi sikhalo nesimbhonono “Asinamali!” “Asinamali!”

“Asinamali”, cried the workers in 1957 under the banner of the then South African Congress of Trade Unions, the predecessor to COSATU. “Asinamali”, the workers cry continued…..

“One pound a day for the factory worker who today cannot buy what he makes. One pound a day for the miner who earns his tuberculosis and goes home broken and to die. One pound a day for the farm labourer who today ploughs the bitter furrow of misery. One pound a day for the builder of mansions who lives in shack….. A minimum wage of one pound a day for all the workers in the land. One pound a day. Five pounds a week. Asinamali… though we work and are labeled as workers.


As democrats we have faith in human beings.  And here springs our belief that working together as citizens of South Africa we can restore human dignity of the downtrodden in this land of our forebears.  Honourable members today I have not come lament about economic crisis whose root cause has neither been foreseen nor fathomed by scholars and those who occupy corridors of political power the world over.  Today I have not come to talk about freedom sans emancipation! - A phenomenon that is beginning to loom large in the present world that we live in.  Nor have I come to talk about the tragedy of colour zoning that continues to mar every aspect of life in our society.  I have not come to talk about the assassins who stand in the dark corners sharpening daggers and ready to take human life including those of their own brothers and sisters.  In short I have not come to talk about the society we are fast becoming – the society in decadence.  Today I have come to talk about those who sleep on an empty stomach and go barefooted while others around them are exaggeratedly rich.  Today I have come to talk about those of our own who are less fortunate.  Today I have come to restate the clarion call that working together we can restore human dignity of all those who have been deprived of this basic human right. 

Decent work remains a dream. A dream that we must strive to fulfill. How can we not strive for decent work, when over 800 000 jobs have been lost last year alone largely due to the global economic meltdown? How can we rest when unemployment levels raised to the highest levels in five years? Even for those workers who remain in employment many are in temporary and casual jobs. Many workers feel caught in a race to the bottom and believe that the current period is exerting downward pressure on working conditions and labour standards. The bargaining strength of labour is being weakened. Informal jobs in all industries are on the rise except mining, utilities and trade. How can decent work be achieved if:

·         Fundamental principles and rights at work are not respected;

·         Employment and income opportunities for women are not created;

·         Social protection is not extended to all workers;

·         Social dialogue is not promoted and institutionalised;

·         Basic human rights at work are not promoted?


Honourable members, how can we not strive for decent work when:

·         Farm workers are exposed to hazardous pesticides;

·         Farm workers are not allowed to enjoy the right to freedom of association;

·         Farm workers are not allowed to form and join trade unions;

·         Workers do not enjoy the right to fair labour practices;

·         Casual workers are suffering employment insecurity and denied benefits.

These developments cannot be left unattended, for our people are restless. People are very angry. People are demanding services from government; they are demanding better quality jobs from employers. They are demanding protection and defence of their bread and butter issues from trade unions. The cry “ASINAMALI – is becoming louder and louder. With increasingly nothing to loose, our people call on all of us to make South Africa a better place to live and work. I have said many times before, when the ladder which we are all climbing starts to be shaken , what matters will no longer be who is on top, but how each one of us hits the ground. Let us not wait for the ladder to shake, but work together to improve the conditions of our people.

One of the critical pillars of our policy interventions is enforcement of labour laws. It does not matter how good the legislation passed by this house is, if they are not complied with, we are all engaged in a futile exercise. We are not in the habit of settling for futility and as such we have started acting in the most be fitting manner to address compliance.

  • To this end we started revamping our inspectorate into a specialized body of professionals.  When this process reaches completion our inspectors will comprise of generalists, specialists and experts.   In the course of 2009 we established a national Roving Team made up of 47 inspectors. The team has the agility to move from province to province within short space of time and do inspections in different sectors.  We have branded them “Inspectors without boundaries”.   In preparation for this work the team went through an intensive training program which encompassed all aspects of the legislation administered by the Department.
  • We trained 30 inspectors to specifically focus on Director General Reviews in terms of the Employment Equity.
  • We have narrowed the space for non-compliance in the area of UIF by appointing a team of experts to focus on pay roll audits.  This will, among other things, ensure that UIF revenue streams are enhanced while compliance is equally upheld.
  • Improved quality of work of our Inspectorate enables the Department to know facts about the state of compliance and it enhances our ability to plan better for the future.  With confidence we can say that daily and blitz inspections conducted during the year 2009 took our inspectors to 108 961 workplaces.  At face value the levels of non-compliance are alarming yet the reality drawn from our inspection data shows that 80% of the workplaces visited complied.  Equally important is to note that incidents in the high risk areas were reduced by 63% from the figures of the previous year.  On the basis of statistics from the Compensation Fund and Federated Employers Mutual Association we were able to determine that high risk sectors inclusive of Iron and steel, Construction and Chemical industry have a combined accident cost value to the economy of two billion rands. 


Honourable members, on our agenda for 2010 we have put Employment Services of South Africa implementation as a strategic intervention to integrate active labour market measures inclusive of job placement services, job search training, career guidance and skills development. When the Employment Services potential has been fully unleashed it will have links with the UIF, the Compensation Fund and the public works programmes.  May I say that this is not in the far distant future.  As we speak 47 career councilors have been deployed in some of our labour centres and a total of 41 210 people benefited from their guidance services and career information. The Employment Services IT system has been rolled out to all the 125 Labour Centres. As at end of December 2009 a total of 470 006 work seekers were registered on the ESSA system and a total of 21 074 job opportunities were registered on the ESSA system.  Using the job matching services of ESSA the first 6 845 job opportunities were filled.   This is the taste of good things to come. We are beginning to call the unemployed BAYE KWA LABOUR.  


We are aware of the complexity and the magnitude of the work that still needs to be done.  But we are equally convinced that no single entity acting in isolation will be able to deal with the problem of unemployment and poverty in SA.  It is in this context that our approach is to embrace strategic partnerships that cut across political mandates, partnerships that embrace collaboration with private sector and non-governmental organizations.  For this to succeed we must be bold enough to put aside those who draw satisfaction out of paper pushing and give responsibility to those who have the burning desire to restore human dignity of all the people of our country.  


Honourable Speaker allow me to refer to the skills development a function that now resides with the sister Department of Higher Education and Training. Up to 31st October 2009 when skills development was transferred to the Department of Higher Education and Training, a total of 10, 885 against a target of 18,902 learners were registered in various artisan trades and more than 75,300 workers registered during the previous year completed training in scarce and critical skills through learnerships, apprenticeships and other learning programmes. During the same period, a total of 39,207 unemployed people against a target of 26 000 were assisted through the NSF to enter learning programmes.


What we have learned in the past decade of administering the Skills Development Act is that there is a huge potential to create employment for those who have gone through training.  Our mistake is to focus on employment at the expense of self-employment.  Entrepreneurial awareness is vital in this regard.  In line with the ANC government call for rural development focus, a window of opportunity has come for us working together to open wide any door left ajar to allow our rural communities to start cooperatives and other rural enterprises suitable for their environment.  Often those who complete their training become stranded with skills but with no employer to engage them.  On the other hand they get no support for them to start business.  This is where SA has dismally failed to conquer unemployment and poverty.  Through the envisaged partnerships when learners complete their training, exit strategies should include the possibility of creating self-employment vehicles which will be supported with the necessary resources for a given period of time to ensure sustainability.   The Gauteng pilot project I will refer to later will assist us to test new ideas and learn more as we brave our way through the unknown in search of new pathways to contain unemployment and poverty.


The past year ending February 2010, there were 158 000 more contributors on the database of the UIF compared to the end of March 2009 amounting to 7.7 million workers. However, the UIF paid benefits to 746 352 beneficiaries to a total amount of R5.3 billion – which is a 71% increase in unemployment benefit payments compared to the previous year. This is a clear indication of the impact of the current economic crisis and the job losses of the past year as indicated earlier.


Furthermore, in the coming year my Ministry intends to improve benefits from 8 to 12 months and look at the inclusion of civil servants for UIF. We have also committed to saving jobs and finding alternative employment pathways for those workers unfortunate enough to be retrenched. Working together with our social partners through NEDLAC, we have put in place a training layoff scheme. The training layoff was launched last September jointly with the CCMA. The Unemployment Insurance Fund and the National Skills Fund jointly committed funds for the scheme to the amount of R2.4 billion. The UIF alone contributed more than R670 million for the training of the unemployed - R40 million of which has been allocated for the 2009/10 period, R200 million for 2010/11, R210 million for 2011/12 and R219 million for 2012/13 period. The UIF has also allocated a sum of R2 billion to the Independent Development Corporation to enable it to help companies in distress. As of March 2010 my department had concluded four training layoff agreements covering 2100 workers in the engineering, auto and mining sectors. We will need to do more if we are to cover the 870 000 workers who lost their jobs in the past year, and we need both business and labour in this regard.


The department of labour also adopted some short terms measures to lessen the impact of the global economic crisis. We initiated a pilot project in Gauteng to test the concept of re-training retrenched workers that were receiving Unemployment Insurance Fund (UIF) including those who have exhausted their UI credits for alternative employment. The learners were enrolled as from 1st April 2009 in different Accelerated Artisan Training Programmes lasting between 8 and 18 months registered with the MERSETA, Energy SETA and the Construction SETA.     The project is going well and I personally conducted an inspection of the project on the 05th March 2010.  Government Departments such as Gauteng Department of Local Government and Gauteng Department of Infrastructure Development and companies such as Bytes Technology; Direct Channel Holdings; Munich Bason and da Gama, Super Group, Unitrans, Imperial Logistics are providing work experience opportunities to these learners and have also guaranteed them full employment on completion.


On the review of labour laws


Honourable Speaker, since 2004, we have conducted a lot of research into the labour market - in an attempt to better understand and increasingly appreciate the evolving labour market trends in the country. In the year of action, more research is not required. We now know, from research conducted by Jan Theron that their analysis, “confirms the earlier findings about the application of the legislation concerning unfair dismissals to the Temporary Employment Services situation. The conceptual problems identified can be categorised as follows: the difficulty in identifying the correct employer, the related difficulty of identifying the correct procedure, the difficulty in defining dismissal, and the difficulty in determining the reason for dismissal”. We also know, from research conducted by the Sociology of Work Programme at Wits University that their report proposes, “the outlawing of this labour broking phenomenon. The workers are calling, since 1957 they continue to chant;


“More food to eat, clothes, warmth.

A little light in the deep night of poverty.

Freedom from pass laws, freedom from the midnight police terror.

Freedom from the ghost squads haunting the street corners.

Freedom from prisons and forced farm labour - the horned fingers and welts ploughed into sorry flesh.

Freedom to walk without fear as the companion of the heart”


My answer to the workers is simple – “this is the government that knows where people live, which listens, and which is committed to what it said in its manifesto”. We have listened, and in the year of action, we must act on issues raised by our people. This is the year of action. Yes we shall address the problem labour broking – the problem shall exist no more. Yes we shall prohibit the abusive practices. Yes we shall introduce provisions in the law to facilitate unionisation of workers.

Honourable members we are dealing with unintended consequences of law hence the major review of our labour law. Section 198 of the LRA has created a lot confusion. Our labour legislation has not impeded the growth of the Temporary Employment Agencies. Bargaining councils have tried to regulate this terrible tendency of abusing and exploiting workers without success. The rules that exist thus far and the 2002 amendments have not assisted either. So the coming amendments will provide clarity in dealing with who the employer must be so as to effectively remove the difficulty of identifying the correct or the real employer. The amendments will make it easy for the CCMA to determine as to whether the dismissal has taken place. The constitution of the Republic gives every worker the right to form and join a trade union and also the right to strike. This right is for everyone and every worker whether temporary, permanent and on contract. We are on course - the Bills will be in cabinet in due course. Labour relations Act, BCEA, Employment Act, UIF, OHS, COIDA will be amended.


Honourable Speaker, as part of our efforts to improve the status of vulnerable workers we are investigating the possibility of establishing provident funds in a Sectoral Determination for farm and domestic workers in 2011. Discussions with service providers and stakeholders are already under way to develop specifications for the funds. We have also in the last year concluded sectoral determinations in the private security, contract cleaning, civil engineering and the wholesale and retail sector.


In conclusion allow me to say we look to the future with confidence and great optimism.  South Africans are people of unlimited capabilities that are often noticed by those who are far beyond our borders.  Often we allow ourselves to be consumed by self hatred and we are ravaged by propaganda that focuses exclusively on all that is negative about SA.  Ndivumele ndicaphule kuNozulu imbongi u JJR Jolobe kumbongo othi UKWENZIWA KOMKHONZI.


“Andisenakubuza ndisithi kunjani na

Ukukhanywa yintambo yedyokhwe emqaleni

Kuba ndizibonele kwinkabi yomqokozo,

Ubumfama bamehlo busukile ndagqala

Kuba ndikubonile ukwenziwa komkhonzi

Kwinkatyana yedyokhwe.


Yabigudile intle, izalelw’inkululeko

Ingaceli nto mntwini izingca ngobunkomo.

Uthe umntu mayibanjwe iqeqeshwe ithambe,

Ezilungiselela ngokunga uyasiza,

Kuba ndikubonile ukwenziwa komkhonzi

Kwinkatyana yedyokhwe.


Is it not high time we stood our ground and defend what we are and what we stand for?  Is it not high time we communicated the good news about the good things that South Africans do?  Let us unite and work together and restore our human dignity.


In closing allow me to thank the members of the Portfolio Committee on Labour especially the chairperson Mrs. Lumka Yengeni for the selfless support they give to me and my Department.  I take this opportunity to extend a word of thanks to the Director General and his team for the effort they put to improve the quality of services they render to the people of SA.


I thank you




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