NCOP Communications and Public Enterprise
National Development and Labour Council (NEDLAC) 2008/09 Annual Report
Chairperson: Ms M Themba (ANC, Mpumalanga)
Date of Meeting: 10 November 2009
SummaryThe Executive Director of the National Development and Labour Council (NEDLAC) briefed the Committee on the 2008/09 Annual Report. The four constituencies of NEDLAC were business, labour, Government and the community. NEDLAC was funded by the Department of Labour and the four constituencies were represented on the Council by mandated representatives. NEDLAC consisted of a Labour Market Chamber, a Trade and Industry Chamber, a Development Chamber and a Public Finance and Monetary Policy Chamber. The major challenges faced by NEDLAC were the electricity crisis, the rising food prices and the effects of the global recession on
Members asked questions about the relationship between NEDLAC and the Committee, the role played by NEDLAC on the contentious issue of labour brokering, the non-adherence to protocol by certain Government Departments when Bills were first referred to NEDLAC instead of to Parliament, the synchronisation of provincial and national NEDLAC’s, the role played by NEDLAC to ensure that African countries were in accord on trade agreements with the EU and the WTO, the protection of the clothing and textile industries against cheap Chinese imports, the implementation of the labour standards, the obstacles faced by SMME’s, the possible merger of certain trade unions, the monitoring by NEDLAC of legislation before Parliament, the consideration of the number of jobs lost when reporting on job creation statistics, the fixed assets and equipment owned by NEDLAC and the gender and racial representation of NEDLAC employees.
Briefing on the 2008/09 Annual Report of the National Development and Labour Council (NEDLAC)
Mr Herbert Mkhize, Executive Director, NEDLAC was accompanied by Mr Thembinkosi Mkalipi, Senior Executive Manager: Collective Bargaining, Department of Labour.
Mr Mkhize briefed the Committee on NEDLAC’s Annual Report for the 2008/09 financial year (see attached document). The governance structure of NEDLAC consisted of four constituencies, i.e. business, labour, Government and the community. None of the constituencies had a formal or official veto. NEDLAC was funded by the Department of Labour and the Council comprised mandated representatives from the four constituencies.
NEDLAC consisted of four chambers i.e. the Labour Market Chamber, the Trade and Industry Chamber, the Development Chamber and the Public Finance and Monetary Policy Chamber. The Labour Market Chamber considered all proposed labour legislation relating to labour market policy before it was introduced to Parliament. The Trade and Industry Chamber seeked to reach consensus and make agreements on matters pertaining to the economic and social dimensions of trade, industrial, mining, agricultural and services policies and the associated institutions of delivery. The Development Chamber attempted to reach consensus and concluded agreements on matters pertaining to social and economic policy, urban and rural implementation strategies and developmental programmes. The Public Finance and Monetary Policy Chamber seeked to develop and reach consensus and concluded agreements on all matters pertaining to the framework within which financial, fiscal, monetary and exchange-rate policies were formulated. A comprehensive breakdown of the focus areas, key performance indicators, performance measurements and current status of each of the NEDLAC chambers was included in the presentation.
Major challenges included the electricity crisis, rising food prices and the effects of the global recession on
Mr M Sibande (ANC,
Mr Mkhize agreed that interaction with the NCOP needed to be on a more frequent basis. He pointed out that NEDLAC had never requested to appear before the Portfolio Committee on Labour and interaction took place because the Portfolio Committee demanded that NEDLAC reported to it. NEDLAC came to Parliament only when summoned. He welcomed increased interaction with the Committee. He explained that there was no intention for the Mpumalanga Provincial NEDLAC and the National NEDLAC to undermine each other. The National NEDLAC operated within a broader framework whereas the Provincial NEDLAC was tasked with the development of strategies. Other Provincial NEDLACS existed in the
Mr Mkhize said that the United States of America (USA) and the EU had adopted a divide-and-rule strategy. In
Mr H Groenewald (DA,
Mr Mkhize replied that there were diplomatic ties between
Mr Mkhalipi advised that the intention of the Department was to have the Labour Brokering Bill approved by Parliament in January/February 2010. The Department hoped that the parties in NEDLAC would have discussed the Bill by the end of the 2009/2010 financial year and that the Bill would be presented to the National Assembly and the NCOP during the next session of Parliament. Changes to the Basic Conditions of Employment Act and the Labour Relations Act would also be necessary. Public hearings as well as discussions with NEDLAC were considered useful by the Department. He said that it was difficult to please everyone when one tried to do the right thing.
The Chairperson understood that there were many Committees and even more institutions that appeared before the Committees that were involved in the labour brokering issue. The Select Committee welcomed a greater degree of interaction with NEDLAC on the matter.
Mr Z Mlenzana (COPE,
Mr Mkhize replied that certain Departments continued to ignore the protocol. “Forum hopping” could be a useful instrument but it was being used to undermine NEDLAC. He conceded that the Development Chamber was weak. The Development Chamber had been placed under his care and responsibility in order to stabilise it and to give it direction. The Chamber had the potential to be powerful and could make a significant difference. Government was considered to be the biggest difficulty with the promotion of SMME’s. In terms of the Public Finance Management Act invoices had to be paid within 30 days, however Government killed the SMME’s by late payments. Another reason was regulations. The Department of Trade and Industry was to review the regulatory framework of SMMEs. Legislation passed in 2007/08 criminalised fronting in order to take advantage of BEE but the current issue was about the enforcement of the legislation. Procurement processes had to be proper and the right questions needed to be asked. Regulations concerning procurement were in the process of being formulated but had not yet been finalised.
Mr Groenewald asked why the relationship between NEDLAC and the NCOP was virtually nonexistent. He gained the impression from the presentation that there was a breakdown in communication between Government and NEDLAC and wanted to know what the reason was for the breakdown. The briefing claimed that progress was being made to meet the President’s target of creating 500 000 jobs by the end of the year. He wondered how this statement was reconciled with the fact that more than 1 million people had lost their jobs. He remarked that poverty went hand in hand with education. The education system in
Mr Mkhize explained that the Executive Council was part of the NEDLAC process and included Government, labour, business and communities. He stated that there was no breakdown of communication between NEDLAC and Government. Government was part of NEDLAC. He refused to comment on the state of education in
Mr M Jacobs (ANC,
Mr Mkhize advised that NEDLAC had not been informed by the unions of a possible merger into a single confederation. NEDLAC briefed the National Assembly and the NCOP but the labour constituents of NEDLAC also appeared before Parliament in their own right. NEDLAC did not participate in public hearings in the conventional sense and was only involved at the conceptual stage of formulating policy. NEDLAC became involved once policy was adopted. He explained that NEDLAC was funded by the Department of Labour. The fact that NEDLAC had a deficit led to the assumption that there was a mismanagement of funds. The deficit did not make a material difference to the operation of NEDLAC as the organisation had a healthy balance sheet. NEDLAC ran into a deficit during the 2008/09 financial year because it had to deal with unforeseen emergencies such as the electricity and global economic crises. He gave the assurance that there was no irresponsible action on the part of NEDLAC. The auditors had commented on the fact that NEDLAC had deviated from its strategic plan but NEDLAC’s explanation had been accepted.
Mr D Feldman (COPE,
Mr Mkhize undertook to make the review reports available to the Committee. Information on the plans on contending with the economic crisis would also be forwarded to the Committee. He noted that for 2008/09, there were no white or coloured persons represented on NEDLAC and gave the assurance that plans were being implemented to address the issue.
The Chairperson asked how NEDLAC monitored the Bills that came before Parliament. She asked if the gender issue was taken into consideration when NEDLAC considered Bills. She was concerned that females were under-represented in NEDLAC’s Chambers. She wanted to know if NEDLAC had a gender policy which offered guidance to Chambers, Departments and trades unions. She asked how NEDLAC ensured that information was filtered down to the provincial levels.
Mr Mkhize replied that a distinction needed to be drawn between NEDLAC’s social partners and its secretariat when considering gender representation. The secretariat was his responsibility but the social partners decided whom to appoint to the Executive Council. Female representation in the secretariat was high and there were only four males in a total staff of 21. The Development Chamber was tasked with ensuring that Bills and policies were compliant with the national policy on gender representation. The weakness of the Chamber resulted in instances of non-compliance. Bills were monitored with the assistance of the reports posted by the Parliamentary Monitoring Group (PMG) and information was obtained from the Parliamentary website.
Adoption of Minutes of Committee Meetings
The Committee adopted the minutes of the meetings held on 19th and 26th August 2009, 2nd and 16th September 2009, 7th, 14th and 28th October 2009 and 4th November 2009.
Mr Jacobs asked how the Committee would deal with following up the matters that were mentioned in the minutes of previous meetings.
Mr Sibanda explained that a platform and procedures existed for follow-ups.
The Chairperson asked the Committee Secretary to make a note of any outstanding matters that needed to be followed up by the Committee.
The meeting was adjourned.