Minister of Labour Budget Speech


15 May 2018

Minister of Labour, Mildred Oliphant, gave her Budget Speech on the 15 May 2018.

Honourable Chairperson;
Deputy Minister of the Department of Labour;
Honourable Acting Chairperson of the Portfolio Committee; Honourable Members;
Leaders of our social partners;
Esteemed guests in the Gallery;

Good Morning;

It is truly an honour for me to stand before you this morning to present the Department of Labour’s budget vote for 2018/19 financial year. It is significant that we present our budget in a year when we celebrate the life and times of our struggle icons, Ma-Albertina Sisulu and our international icon, the former President and the late Nelson Rolihlahla Mandela.  

We are also gathered here in the Africa Month, where we recall the seminal writing of Pixley Ka Isaka Seme in 1906, with his prophetic essay, “The Regeneration of Africa”. We also recall that it was this very essay which later went on to inspire leaders like Presidents Kwame Nkrumah of Ghana, Julius Nyerere of Tanzania, Sékou Touré of Guinea and Kenneth Kaunda of Zambia to pursue the ideal of a free and united Africa.

We also stand before you in the Month when we celebrate the struggles of workers around the world, who fought tirelessly for an eight-hour Day, resulting in May Day being declared an international Workers Day. Sadly, we are also delivering our budget vote barely a month after we witnessed the passing of our struggle stalwarts, the mother of the Nation, Winnie Madikizela-Mandela, Comrade Zola Skweyiya and the Chairperson of the Portfolio Committee Comrade Fezeka Loliwe. We say rest in power Maqhawe omzabalazo wenkululeko, we will never forget your invaluable contribution, nilale ngoxolo.

Honourable Chairperson; You will pardon me, if I do not dwell too much on the details of how far we have gone as such details are captured in our annual reports, strategic plans and Annual Performance Plans.  However, the Deputy Minister will cover some aspects of progress to date and our key priorities going forward.

Chairperson, let me start-off by giving a broad-brush synopsis on how far we have come in pursuit of the 2014 to 2019 Medium Term Strategic Framework as our blue print and the ANC electoral mandate. We must underscore that in giving effect to this mandate, we continue to be guided by our Constitutional commitments, the Freedom Charter and the 2014 ANC Election Manifesto.

We understand that this juncture of our democratic transition, calls for bold and decisive steps to place the country on a path that seeks to eliminate poverty, creates jobs and sustainable livelihoods for our people. This requires radical change and a sustained focus on addressing the real issues not just empty rhetoric.

Honourable Chairperson, the ANC government has indeed taken concrete steps to ensure that the commitments in the Medium Term Strategic Framework, receive the attention they deserve.

True to the African proverb that says, and I quote; “if you want to go fast, go alone, but if you want to go far, go together.”  

We have indeed carried out our work in collaboration with our social partners and our people, in order to ensure that the outcomes are not short term, but medium to long term and most importantly, sustainable.  We have been relatively successful in dealing with key priority issues in the Medium Term strategic framework of the ruling party.  

These include, putting in place measures to reduce workplace conflict, improving collaboration between government, organised business and organised labour; enhancing fairness in the workplace and encouraging robust, but mutually beneficial labour relations culture. Collective bargaining structures and dispute settlement mechanisms are constantly being strengthened.

Strengthening inspection and enforcement has remained one of our main focus areas in this Medium Term Strategic framework period. Whilst we have exceeded our set targets on the inspections, we have now turned our attention to strengthening enforcement by introducing enabling legislative instruments to navigate the inherent complexities in this work.

Unprocedural and unprotected strikes levels have declined significantly in the last three years and the proposed amendments to the Labour Relations Act will assist to sustain this welcome development.  
Whilst there is clear evidence that we have made significant strides in pushing the key issues on the 2014 to 2019 Medium Term Strategic Framework action plan, we recognise that there is still some way to go to complete this task. We will use the remaining months to the end of this administration, as a final push to complete any of our unfinished tasks.

Honourable Chairperson; at the risk of sounding like I am bragging, the ANC government has indeed delivered on the call in the Freedom Charter that;
a) All who work, shall be free to form trade unions, to elect their officers and to make agreements with their employers.
b) Workers shall draw full unemployment benefits
c)  Men and women of all races shall receive equal pay for equal work.
d)  There shall be a forty-hour week, paid annual leave and sick leave for all workers, and maternity leave on full pay for all working mothers.
e)  Miners, domestic workers, farm workers and civil servants shall have the same rights as others who work, and,
f)   There shall be a National Minimum Wage.

To complete this work, parliament is seized with considering the first ever, National Minimum Wage Bill to be introduced in South Africa. You will be pleased to know that this is the only policy demand in the Freedom Charter, which remained outstanding to date.  When it is finalised, we can gladly stand back and rightfully proclaim that mission accomplished.

Honourable Chairperson, there are few issues that I need to deal with. The first, relates to the fact that the number of people who now have access to the services of the department, has grown significantly since 1994. Secondly, the service offerings of the department has also increased many-fold from what it used to be in the period pre-1994. We have recognised that the increase in the services we provide, and the increased number of people that have access to our services, has inadvertently put a strain on our infrastructure.  

It is true that our infrastructure has not kept up with the volumes of people that use our service offerings, as a result, this has inevitably compromised the quality of service delivery in some instances. For this reason and guided by the Medium Term Strategic Framework, we have developed plans to ramp up our infrastructure and modernisation of our service delivery platforms.

The Unemployment Insurance Fund and the Compensation Fund are leading in this regard given that they are the two entities that command the biggest share of the services that we provide. Both funds, in addition to employing more service oriented personal, have introduced sophisticated online systems to enhance better service delivery. We all recognise that keeping our service delivery platforms up to speed with the demand on our services, will take time, but we will not take our foot off the pedal.

The Public Employment Services has been extremely successful in registering work seekers and other related services; the focus and orientation will now concentrate more on ramping up the number of placements as that is where the desired impact will come from.  

Inspection and Enforcement Services registered high levels of success on the inspections and follow-ups fronts, however the focus going forward, will direct more energy in the efforts to improve enforcement.

With regard to enhancing employment opportunities, the Unemployment Insurance Fund will continue to work with the Department of Higher Education and Training, Public Works on the Expanded Pubic Works programme exit plans and the TVETS on up-skilling UIF beneficiaries.  

Our partnership with the IDC created over 29 000 jobs and saved over 16 000 in the last four years ending 31 March 2018. We will continue to partner with the IDC as we have again ring-fenced Five Billion Rands for labour intensive investment projects going forward.

You will recall that last year, I reported on the Compensation Fund and the South African Association of Chartered Accountants, (SAICA) partnership to train learners on Medical and Actuarial skills. I reported also that the first intake of 100 learners, commenced their studies in different skills disciplines and these were;  

  • 20 Medical doctors
  •  20 Nurses
  •  35 Occupational Therapists
  •  5 Actuaries
  •  20 Medical Orthotists & Prosthetics

I am happy to report that the partnership with SAICA, is beginning to bear the desired results.  All 100 of the 2017 intake progressed to the second level of the programme. We are very proud to announce that 22 of the learners from this programme, are our guests this morning and are sitting in the gallery. Please stand up so that the honourable members can see you.

We are aware of challenges in Occupational Health and safety environment, and it is precisely for this reason that Cabinet has approved the passage of the Occupational Health and Safety Amendment Bill to Parliament.

Honourable Chairperson, our efforts to expedite the amendments on the Compensation of Occupational Injuries and Diseases Act (COIDA), have turned out to be more complex than we had initially thought. The public comments window and the engagements at Nedlac, generated high volumes of public comments on the Bill and this slowed down the process considerably. The Bill is still going through government internal processes.

The Unemployment Insurance Amendment Bill has also been delayed, in part, in order to accommodate the private members’ Bill and to complete the consideration of regulations. The Bill is currently going through the parliamentary processes and we anticipate that it will be finalised shortly.

Now let me turn to the policy matter that has occupied the hearts and minds of many South Africans these days, that is, the proposed National Minimum Wage Bill.  

There are those who have come out in support of this policy intervention, and there are equally those who, for various reasons, are opposed to this intervention. I have said this before, and I want to once again underscore, that whilst the introduction of the national minimum wage may not mean a lot to those who are well looked after in the world of work, for the majority of the vulnerable workers, it will make a huge difference. National minimum wage is by no means an end in itself, but a means to an end.  

Setting the inaugural level at R20 per hour, was informed by research and robust analysis of various scenarios and their possible ramifications. This level is informed by the real world considerations and not some idealistic desires.
Honourable Chairperson, the current debates on the introduction of the National Minimum Wage has help to expose those, who when it suits them, claim to be on the side of the workers, but when they must walk the talk, they show their true colours.

At least today everyone knows who truly cares about vulnerable workers and who is pretending. We are also aware that the country is about to enter the electioneering season ahead of the General Elections in 2019.
Therefore, some of the propaganda against the National minimum wage, is nothing but pure electioneering and attempts to score cheap political points.  It is also disturbing that those who are against the National Minimum Wage, have nothing to offer as alternatives, but want to keep the status quo. Those who are demanding that the level be set higher, are totally oblivious of the consequences of doing so.

It is ironic that whilst the legislators are busy doing shadow-boxing on the national minimum wage, it is said that, a number of progressive employers have already started adjusting their workers’ wages in anticipation of the national minimum wage becoming a reality.  It is also heartening that the employers in question, are adjusting workers’ wages upwards and not downwards as others would want us to believe.

Honourable Chairperson, another matter that has been exaggerated in the public domain, relates to the proposed amendments to Section 95, 99 and 100 of the labour relations Act. This is with respect to requiring trade unions and employer organisations that seek registration, to make provisions in their constitutions requiring a secret ballot of members before embarking on a strike or lock-out as the case may be.  

The impression that is created in the public discourse, seeks to suggest that this provision in the LRA is new, which is not the case. Trade union constitutions have always made provisions to ballot their members. The only thing that is new, is the introduction of the word “secret” and an obligation to keep the records for a certain period of time.

It is intriguing to note that the Collins English dictionary, defines the word “ballot” as a secret vote in which people select a stance or express their opinion about something. The Oxford English dictionary defines the word “Ballot” as a system of voting secretly and in writing on a particular issue. Introducing “secret” before the word “Ballot”, is therefore nothing new, but an emphasis on real meaning of the word and what is already implied in the existing law. This amendment is informed by our commitment to simplify the labour laws, honourable members.

The second source of protest by certain people, stems from the four proposed changes to section 32 of the LRA and the rationale behind each one; The first is the extension of the period within which the Minister must extend a collective agreement if the parties to the agreement are only sufficiently representative. This is to provide the Minister with sufficient time to consider any comments received in respect of the Minister’s notice published in terms of section 32(5)(c) of the Act.

 The second is to provide for improved representativeness requirements for the extension of collective agreements under section 32(2) of the Act. Section 32(2) of the Act required the trade union party to the agreement, to represent the majority of employees and in addition, that the members of the employer organisations party to the agreement, be required to employ the majority of employees within the scope of the agreement. The amendment now only requires one or the other.

In order to promote collective bargaining at sectoral level and in accordance with the jurisprudence of the International Labour Organisation (‘‘ILO’’), the operating principle underlying the extension of agreements is either whether an agreement applies to the majority of employees in the sector or, to the scope of application of the agreement. In other words, the principle is now one of coverage rather than strict representativeness.

This is a major breakthrough for the labour movement and not an easy victory at all.  I do not understand why trade unions are not celebrating this development.

The third is the manner in which representativeness is determined.

The original intention of the Act was that the representativeness of bargaining councils and their constituent parties, would be determined annually by the Registrar and not each and every time a bargaining council referred a collective agreement to the Minister for extension. The amendments to both sections 32(2)(c), (5)(a) and 49 of the Act, seek to give effect to that intention and nothing more.

The fourth is to give the Minister the power to make regulations on the procedures and criteria that bargaining councils must take into consideration, for purposes of complying with the requirements for exemptions from collective agreements.

The code of good practice on the other hand, is intended to provide practical guidance on picketing in support of any protected strike or, in opposition to any lock-out.  It is intended to be a guide to those who may be contemplating, organising or taking part in a picket, and for those who as employers or employees or members of the general public that may be affected by it.

Honourable Chairperson, we are aware of the issues that the Auditor General has raised, and we know that not all of them have been resolved, however they are receiving focused attention.  
We are confident that we are making progress in getting these matters corrected along the lines of what the AG has recommended.

Honourable members, you will recall that South Africa assumed the chair of two international bodies this year. The Southern African Development Community (SADC) and the Brazil, Russia, India, China and South Africa (BRICS).  I am pleased to report that we hosted a successful session of the SADC Ministers of Employment & Labour and social partners in March 2018 in Cape Town.

With respect to BRICS, as the current chair, the Minister of Labour assumes the chair of the Jobs and Employment Chapter, which takes place at both technical and Ministerial levels through the Labour and Employment Ministerial Meeting. This stream of work was created to strengthen intra-BRICS coordination, enhance information sharing, as well as cooperation in matters of mutual interest in order to address labour and employment challenges.  I am pleased to report that we hosted the technical team meeting recently, in preparation for the Ministerial session later in the year.

South Africa continues to get recognition of what it has to offer in shaping the international discourse.  Recently, the International Labour Organisation has invited our president, His Excellency Cyril Ramaphosa, to take a leading role in the ILO’s Global Commission on the future of Work as co-chair with His Excellency, Stefan Löfven, the Prime Minister of Sweden.

This represents a profound recognition and confidence in what South Africa has to offer in shaping the global agenda on topical issues. We are even more excited that, in addition to the ILO invitation to co-chairing the Commission, the ILO has also extended an invitation in advance to our President, to address the ILO’s centenary Conference in June 2019, pleasantly coinciding as it does, with the historic year of the celebration of the birth of South Africa's first democratically elected President, the late Nelson Mandela. This is indeed a gesture of the highest honour for South Africa and its people.

Let me conclude by thanking The Deputy Minister of Labour, Inkosi Advocate Pathekile Holomisa, for his unwavering support; also extend my sincere gratitude to acting Chairperson and Honourable Members of the Portfolio Committee on Labour, for your continued support and guidance in executing our work.  

Let me also extend my gratitude to our social partners for always being there when we need them and to the Director General and his team for their support.

I hereby table the 2018/19 Budget Vote 28 totalling 3.2 billion Rands for the Department of Labour for your consideration.

I thank you.