Fourth Industrial Revolution impact on Labour; Labour Centres; High Level Panel recommendations

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Employment and Labour

31 October 2018
Chairperson: Mr B Mashile (ANC), then Ms S van Schalkwyk (ANC)
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Meeting Summary

The Committee received a presentation from the Research Unit in Parliament on the envisaged effects of the Fourth Industrial Revolution on the labour sector. The presentation addressed how other countries are preparing for the Fourth Industrial Revolution, concern for how labour matters will be navigated in South Africa, and it positioned the role of Parliament in terms of bringing about relevant labour legislation for market regulation and protection of workers, and introducing new forms of social dialogue to cater for the new ways of working. It recommended changes in employment protection and tax systems.

The Department of Labour presented a review of the impact of the Fourth Industrial Revolution on employment and noted the characteristics of the fourth industrialisation through robotics and drone technology; the impact on job losses and job creation world-wide and in South Africa, and the high, medium and low impacts with the risk of automation; statistics on the impact of the Fourth Industrial Revolution by race, gender, age, province, and industry; industries where automation is a high risk; the top high risk employment sectors; and implications for unionization.

Members were concerned about managing the impact, with rising unemployment and called for a state role to intervene in the market economy where capitalism adjusts to market forces. They noted the need for legislation to protect workers from exploitation, and for health and safety reasons. There was concern about the vulnerability of a large percentage of workers to losing jobs to advanced technologies such as technicians in manufacturing industries and semi- and unskilled workers. Members paid due regard to the existence of the formal and informal economies and the differing impacts on these. There was advice on the need for monitoring mechanisms to identify the skills required through workplace skills plans. Members wanted to hear from the Department about the role the Committee should be playing and what it needs to do to manage the impacts. They wanted proposals from the Department on how the country and the Department will respond to these impacts.

The Department also briefed the Committee on the state of Labour Centres nationwide. The presentation gave a breakdown of the type and number of service delivery points, their provincial breakdown and number of clients served by province and per labour centre per month. A challenge was the need to move the location of service delivery points to areas of greater economic activity. Other challenges were the impact of the lack of infrastructure such as banks and postal points in rural towns, which people need to access for processing UIF – as well as challenges due to unrest in the North West. Some labour centres had been closed due to non-compliance with the Occupational Health and Safety Act. The challenge of sourcing accommodation was highlighted as were the problems in the partnership with the Department of Public Works, in leasing accommodation, the lack of leases, the impact of short leases with buildings not being maintained, poor maintenance of government buildings by DPW and the lack of strategy for this, and the closure of the offices. A breakdown of leased and state-owned buildings was provided. The interventions to improve service delivery were noted.

Members were concerned about the lack of access of smaller towns and rural villages to service delivery points, and the pre-democracy spatial locations of these, which were not serving the needs of the public. There were concerns about the high vacancy rate, that some Labour Centres were not properly resourced, especially with vehicles, and did not have effective security measures in place for staff. Members were pleased with the move of the satellite office from Goodwood to Khayelitsha. Members pointed to the challenges in the accommodation of Labour Centres, the lack of maintenance for both state-owned and privately owned buildings, the lack of lease agreements, the impact of closure on service delivery, the security of equipment through lack of insurance (guaranteed by the leases), in sourcing office accommodation and the Public Works lack of strategy to maintain buildings.

The Committee considered the Committee Report on the High Level Panel recommendations and Members will reflect on it and submit further proposals and recommendations.

The Supported Employment Enterprises (SEE) projects briefing was postponed.

Meeting report

Fourth Industrial Revolution effects on Labour Sector: briefing by Committee Researcher
Mr Teboho Mokoena, Committee Researcher, cited how other developed/developing countries are preparing for the Fourth Industrial Revolution. The Committee needs to concern itself about how labour will navigate the storm. He illustrated how other governments are supporting innovation, such as Brazil which is providing tax breaks for people doing innovation. He questioned what the role of Parliament is. For example, with Uber he queried what labour legislation is doing for Uber drivers to register for Unemployment Insurance Fund (UIF) and get benefits. The role of Parliament should be to design new market regulation, for example, in health and safety, and provide an activation framework to mitigate some of the adjustments of moving towards a more technologically advanced economy by helping workers to change skill sets.

Secondly Parliament needs to encourage new forms of social dialogue which allow tailored solutions to new challenges because people are working independently. His recommendations were changes in employment protection, for example training and education for labour inspectors; security systems to reflect new forms of jobs; development of tax systems to maximise tax collection, and tertiary funding for training.

His conclusions were that it is not known what will be the jobs of the future. The report of the World Economic Forum suggests 41% of work activities in South Africa are susceptible to automation as digital innovation is profoundly changing the way of working. He mentioned the trends challenging the traditional labour market which require new thinking about shaping the world of work. Labour markets should be more flexible.

The Chairperson highlighted the role of government in managing the world of work with these technological changes abounding.

Department of Labour review of the impact of the Fourth Industrial Revolution on employment
Mr Virgil Seafield, DoL Deputy Director General: Labour Policy and Industrial Relations, spoke about the need to engage with the impact of the industrial revolution on the labour market. One needs to think clearly what the response – including the Department’s – should be. He gave examples of technological innovation such as technology negating the need for a workforce in the agricultural sector, with irrigation systems.

Ms Tendani Ramulongo, Director: Research, Policy and. Planning Unit, said the Fourth Industrial Revolution was characterised by the introduction of robots and drones, capable of doing what people do. She spoke about jobs the Fourth Industrial Revolution is introducing, whilst shedding others. The World Economic Forum’s study indicated that jobs lost world-wide will be 10% and jobs created 11%, between 2018 and 2022. The WEF gave statistics on the actual numbers of jobs expected to be created and lost through this revolution. The impact of jobs being lost in South Africa through automation was presented as reflected in a study by Rooney et al with the high, medium and low impacts outlined. She noted that the Department had worked on regulating temporary employment agencies. She indicated that in future employers will not need people to occupy jobs for a long time; they may hire contractors with specialised skills. She showed statistics for South Africa on the impact of the Fourth Industrial Revolution by race, gender, age, province and industry. She also indicated the industries where automation is at high risk (for example, construction), and the top high-risk employment sectors (for example, community, social and personal services). Africans were most vulnerable at an elementary level – particularly in security and agriculture. Sectors that will be most affected are those that employ semi and unskilled workers. She talked about the implication for unionization and protecting worker rights. As workplaces will not be physical spaces (for example, for inspection), this calls upon trade unions and labour administrators to rethink ways of doing things. She spoke about business making employment decisions based on maximising profit, using localised skilled talent. Based on that, the country needs skills. Policy can influence this. The less prepared the country, the higher the job losses.

The Chairperson asked for clarification on her concluding remarks. This was “the less prepared and proactive the country, ….the higher the job losses”, “direct due to the changing nature of domestic production” and “indirect due to loss of international market shares”

Ms Ramulongo replied that this referred to South Africa lacking competitive advantage.

The Chairperson suggested the wording read, “The less prepared and less proactive”.

Ms Ramulongo said her concluding remarks were about being pro-active, influencing policies, ensuring decent work, and working towards the sustainable development goals.

The Chairperson questioned how one manages the impact of both the nine million or so unemployed taken together with those who are working whose jobs are now vulnerable to automation. He said it was a question of intervention and the state plays a role. The context of the presentation is a market economy where capitalism adjusts to market forces. The difficult social issues on the ground dictate that government intervene.

Mr M Bagraim (DA) applauded the two presentations as being ground-breaking. He made mention of a client outsourcing work to Pakistan due to the concerns associated with outsourcing in South Africa. He had concerns about Airbnb establishments and health and safety of employees, and the lack of protection of Uber drivers who are not employees. Uber has run to the Labour Court with its case.  Every business looks at the cheapest way to make a profit. He stressed the importance of harnessing that to ensure business stays in South Africa. He said Members should start looking at labour legislation, and enhance the legislation to encourage people to employ. People need encouragement to invest in labour intensive skills. He referred to his obtaining an opinion from experts (in South African law) in India, through fast online consultation.

The Chairperson mentioned the main aim of the Investment Summit was to create employment to stem high unemployment. His concern however was that technicians in manufacturing (working with machines and vehicles) are almost 100% vulnerable to automation. If a factory is built with robots to produce cars, the gross domestic product will go up, but so will unemployment. He referred to Mr Bagraim’s comment about needing deliberate policy making in labour intensive production. He advocated that where the state is investing – such as road works – to legislate to use labour, to close the gaps.

Ms S Van Schalkwyk (ANC) welcomed the presentations and congratulated the Committee researcher. She expressed her concern about the lack of readiness for the Fourth Industrial Revolution. She posed a question to DoL who indicated 10% jobs will be lost, and 11% will be gained – to which sectors do the jobs lost and jobs gained refer? Whilst employers report to DoL on workplace skills plans, there is a need for a proper monitoring mechanism. DoL should direct employers to what critical skills will be needed in future, and make provision for workers to develop skills.

Mr W Madisha (COPE) said that what has been reported is no secret. DoL should be saying what the Committee and government are supposed to be doing. The Members have to be given the information. The Committee has not been given direction as to what to do to facilitate employment. He referred to the inability of matriculants to go on to do technology studies due to the high levels of unemployment in the country affecting parents. Through the Chairperson he asked DoL to look into what action the Committee must undertake so that the Committee can tell Parliament to provide governance so to undertake the required action – the Department to do this through proper scientific analysis.

Mr Bagraim mentioned in London they do not have petrol attendants. In South Africa there are 700 000 jobs as petrol attendants. If one assumes they feed four people each then two million people would be affected by job losses. The country needs petrol attendants.

The Chairperson said that a request for a paper from DoL makes sense. Elements of the Fourth Industrial Revolution are still to come. There is a need to unpack the matter. He asked what government is doing about it – before it comes down to the impact on DoL and Labour Centres. With the Investment Summit he queried what jobs will come up – to be skilled to manage robots? A bigger slice of the workforce might not be re-trainable, such as people over 50 years. They could clog UIF. He noted the existence of two economies in the country, both formal and informal. He queried which one will the Fourth Industrial Revolution impact on more. Which one will be mitigated? What is the role of government? He advocated for government intervening and influencing market forces, using direct public investment, and regulating, to produce the outcomes one wants to see. He advocated an interventionist government strategy in both the formal and informal economy.

Mr Teboho Mokoena commented that they move away from a discussion of what is taking place and what we are going to do, to a discussion of the role of legislation and policy to prepare for what is taking place and how we treat this going forward. He can also be in consultation with DoL.

Mr Seafield agreed to work with the research unit in the Committee. He wanted to give the Committee a sense of what the impact will be on the economy and on employment, given the policy environment. He wanted to give an understanding of the impact in different categories of work, demographics, race and gender. When the policies are realised they will impact on these factors. The number of jobs that may be lost is 10%, and the number created 11%. He stressed the importance of enforcing coding in the school curriculum and gave the example of Silicon Valley, USA where people from India with those skills are employed in large numbers. In speaking about educational training, he noted the importance of separating primary, secondary and vocational training and stressed the importance of changing the educational response to deal with the impact - such as when accountants and health practitioners will no longer be needed, and will be phased out by technology.

Ms Ramulongo referred to the 11% job creation and 10% job loss scenarios of the Fourth Industrial Revolution. She made mention of big data analysis, software developers, and robot developers as jobs created by the Fourth Industrial Revolution. There is a need for skills to work in these spheres. Currently the country is not in that state of education and training. Referring to workplace skills plans, she said a key element is that employers are not analysing or reporting what skills are needed. There is a need for collaboration with what industry needs, and what education and government is providing. She advocated that there should be a look at big data – customer information – as to what people want from analytics. This requires analyst skills.

Ms Ramulongo said she appreciated the inputs and will work on what needs to be done. Concerning the jobs to be phased out, she suggested re-skilling people, and examining the impact on the 15-24 years age group - as a way to influence strategy.

Mr Bagraim mentioned that during a visit to Israel, he came across Innovation Nation where masters’ students are obliged to train others in four years. He suggested that DoL should be encouraging the same principle.

The Chairperson asked who amongst DoL management is concerned with the Fourth Industrial Revolution. He emphasised the need for a DoL manager to work on it on a daily basis, and to determine how it affects the Department. He wanted management in DoL to champion the work around this, and adjust timeously to what has to be done. He would like to see the impact on the UIF – how DoL will pay UIF benefits at Labour Centres in the next year or two. He queried whether they can work without offices. He asked why people must flock to labour centres. DoL should be doing things so people do not have to queue at the offices. He requested a paper on the subject from DoL concerning the Fourth Industrial Revolution and its impact, how the country is responding, how DoL is dealing with it and the gaps, and to make proposals on how DoL will deliver. The paper was to talk to the two economies, operating with different sets of rules.

The Chairperson added that legislation in Parliament comes when there is a gap. Exposing these gaps allows for legislation to close them. He called the presentation eye opening and agitating. The paper must address what government is currently doing as a subset of thinking of how the country is thinking.

Labour Centres: status report by Department of Labour
Ms Marsha Bronkhorst, DoL Chief Operating Officer, gave a provincial breakdown of the type and number of service delivery points and said that the report indicated where labour centres are based in the townships, although there are not many situated there. The provincial breakdown of the number of clients at labour centres was noted with nearly a third seen at the Gauteng Labour Centres. Limpopo has a large number of clients because when clients become unemployed they go home. DoL has a challenge in that service centres in Mpumalanga no longer coincide with areas of greater economic activity. DoL is finalising the process of moving the full-time Labour Centre from Sabie to Bushbuckridge in Mpumalanga where there is more economic activity, and locating the satellite office in Sabie.

She distinguished between what service a labour centre offers compared to a satellite office. She noted in the Northern Cape the lack of infrastructure - such as banks and postal points in rural towns - which the public need to access so as to comply with UIF FICA certification at banks. This means that people have to travel to labour centres at bigger towns in order to access a bank, in any event. This problem is starting to occur in other provinces. In the North West there were serious challenges to service delivery for processing UIF and so forth. This was due to the proximity of the Labour Centre to the Department of Social Development, where there was unrest and disruption. DoL had to move in order to be operational. DoL is looking at moving the Goodwood satellite office to Khayelitsha. She noted the average number of clients served monthly (325 931), and six labour centres being closed due to non-compliance with the Occupational Health and Safety Act (OHSA) such as Johannesburg. A number of labour centres had been identified for alternative accommodation. The Bloemfontein office had closed down, but had re-opened.

Ms Bronkhorst indicated challenges in the sourcing of accommodation. There was reliance on the Department of Public Works (DPW) as DoL has to use DPW as a partner in the procurement of accommodation, although the latter’s procurement processes are slow and inefficient, and the buildings have to be falling down, before some action is initiated. DPW has also taken the decision not to renew lease contracts, or to renew them on a month to month basis This leads to serious challenges with landlords who are not willing to maintain buildings. Where DoL has lease contracts, the buildings are not in good condition. The landlords are expected to spend millions to maintain a building without a contract being in place. The landlords do not know when DoL will move out of the accommodation, effectively leading to the office being closed because the maintenance is not being done. There is no strategy for DPW to maintain government owned buildings. DoL is not allowed to maintain government owned buildings (only to a limited extent) and it has asked to be released from these conditions with DPW, but with no success.

Ms Bronkhorst mentioned its interventions to improve service delivery. DoL has approached and sought the assistance of the Compensation Fund and UIF to source accommodation via the Public Investment Corporation (PIC). Other interventions included 3G cards to service visiting points, and cell phones to assist Client Service Officers at visiting points. DoL has appointed 258 UIF dedicated Client Service Officers, and 100 Compensation Fund dedicated Client Service Officers.

The Chairperson received confirmation from Ms Bronkhorst that officials providing service at visiting points are a part of the Labour Centres’ staff complement. He had calculated roughly that 80 people are served daily through labour centres and satellite offices and cited the need to understand the Northern Cape better as villages are small and at some distance from each other. With no public transport, people rely on lifts. The population is low. It is difficult to provide or obtain services in this context. Mobile offices were the most appropriate system to provide services. He said offices are still located within the apartheid era spatial distribution. He cited the office in Tzaneen yet the township is 15-20km outside of Tzaneen, with a large number of people living there, needing these services, who have to travel to the Tzaneen Labour Centre. The people in Tzaneen are of middle and high income and do not need the office for UIF and compensation. He cited another example of Bushbuckridge which has a visiting point serving about 600 000 people. He said the biggest problem is being responsive when making an assessment of services. DoL is not doing this. He said DoL inspectors are closing the offices. He referred to the many offices where the lease agreement has expired in 2016. DoL is providing services at offices from which they can be removed. The DoL Risk unit should have obtained an agreement about DoL seeking accommodation if the DPW is not serving DoL. He questioned what the Risk unit is doing – does it not see the challenge to service delivery?

Mr Bagraim said he was pleased to see there will be a permanent office in Bushbuckridge. He said people go the office in Bellville, where they receive great service, with online access and quality answers. In the townships people do not get service at all, and Members had observed that an office was not operating during working hours. The problem was the staff, and lack of oversight by management. People say they would rather travel (and pay) to go to Bellville to get good service.

Ms Van Schalkwyk welcomed the report. She asked why in Mpumalanga, Limpopo and North West the vacancy rate is more than 10%. It was extremely high. Members had spoken about the state of Labour Centres. They have found that a Labour Centre is not properly resourced to serve the public. However, they did not get an idea of the resources of the Labour Centres from the report. The Members had to go to specific Labour Centres to see what was happening on the ground. With some labour centres they found there were no proper security measures in place, for securing the safety of the staff. Also, there was a concern, in some instances, about the conditions and environment in which security is working. She wanted a response to that. When DoL allocates resources, does it take the material conditions into account, such as rural offices needing a 4 x 4 and not a sedan car? Some places reported a shortage of vehicles - a vehicle may be irreparably broken down, where they needed 4 x 4s. In terms of leases, in Aliwal North the lease ended on 31 March 2012. For the period 2012-2018 the owners of the building would not necessarily provide maintenance. She queried the list of offices that have been closed down for non-compliance with OHSA - was DoL monitoring the status of labour centres especially those that are outside of the lease period. What was the status of those Labour Centres especially in terms of OHSA? The Committee does not want to be in the firing line and nor for the Department to appear in the newspapers for non-compliance. The Committee knew about the situation, but not how it has worsened. Many Labour Centres might be non-compliant because of poor maintenance, and may need to be closed down. On the relationship between DoL and DPW, does DoL have a plan, a structure, or mechanism in place to engage with DPW to ensure compliance with buildings and leases.

Ms Van Schalkwyk referred to the list of leases versus state owned buildings, and noted the Kimberley office in the Northern Cape was omitted – was it on lease or a state-owned building? Are there offices which are not on leases or state-owned? What is their status? A number of people had advocated for the move of the satellite office from Goodwood to Khayelitsha and she was very pleased about this. The Committee does not know the timeline for the move. She asked what the plan is for the new satellite offices, looking into the future – especially where service needs are high.

The Chairperson asked the Committee to look at the office allocations in terms of provinces. He wanted an explanation for the numbers inside the brackets, how to read them – such as (1 of 19 - 5%). He asked about Worcester which has a bulleted list of small towns underneath, what did that mean? He asked what the reasons were for Labour Centres identified for alternative accommodation. He asked about the state of state-owned accommodation. With the challenges faced by DPW in relation to the state-owned buildings, he asked what happens. When such a building is closed down by DoL Inspectors, it is a long process before one can re-occupy that building. With the closure of the Johannesburg and Mombela offices, where, how and what are the officials doing now. If officials tell people to go to nearby centres there will be problems such as overtime.

Ms Aggy Moiloa, DoL Acting Director-General, said the bulk of the questions on lease agreements and alternative accommodation would be dealt with by the CFO. She said the spatial distribution of offices was led by the pre-democracy period. In terms of the Fourth Industrial Revolution, DoL is automating some processes. People who have more advanced technology can access services in that manner. In response to Mr Bagraim, she said that where people get service, they have a preference to go there - even if they incur an extra charge. On the matter of cars, DoL does provide for customisation of cars for particular areas, where roads are not suited to sedans. On the monitoring of DoL offices to ensure compliance, DoL takes steps ensuring the inspection of offices. Where a special danger to employees is seen, the offices are closed as DoL put the interests of employees first and foremost.

Ms Bronkhorst responded about the Johannesburg office that was closed, saying that the employees are either accommodated at visiting points, or at satellite offices, or at Labour Centres nearby. Officials from the Johannesburg office are manning visiting points under the Johannesburg office, even though the Johannesburg office is physically closed. This principle applies to other Labour Centres that have closed. She agreed with the statement that where the public gets service, they prefer to go there, and will bypass the nearest office. It happens frequently. Not all offices are of the same standard. The provincial management teams are working on that to ensure service delivery is at the same level. DoL is in the process of skilling managers to ensure service delivery happens.  There are concerns about the vacancy rate and she referred to a few of the offices raised in the briefing. To fill these posts DoL has embarked on a plan to recruit people, mostly at entry level with a few more specialised staff. DoL is facing structural HR challenges in Mpumalanga and in Limpopo. The influence of the unrest in the North West meant that the Labour Centre could not be operational, but that has started to improve.

As to physical resources, the provinces’ labour centres are meant to give input on what they need. The same holds true for vehicles. There is a high demand for 4 x 4s. That request has to be weighed up. The CFO would address the relationship with DPW. There are relationships with DPW at provincial level. This is managed by the head of the department in the province. The Kimberley office is leased and she apologised for the omission. Part of the CFO’s portfolio is the physical resources. As to the numbers in the brackets such as (2 out of 16 - 13%) in Aliwal North, 16 represents the establishment of the office; the first figure (2) represents the number of vacancies, which is then shown as a percentage (13%). In Worcester, those towns listed in the bullets are the visiting points serviced by that Labour Centre.

The Chairperson noted the Worcester Labour Centre has 34 staff to service a huge number of visiting points. He was concerned about the Labour Centre being vacant, with all the officials out. How is this done operationally?

Ms Bronkhorst responded many of the visiting points are serviced on the same day – serving maybe one or two clients only, visiting a small number of towns each day, where one visiting point is visited for example from 8am -10am, the next from 11am-1pm and so forth.

The Chairperson said when DoL provides the expenditure report the Committee will get more information on the operational processes for visiting points when there are so few officials at the Labour Centre. The majority of staff is located in the Labour Centre, with a small number of staff going out to visiting points. When the staff has finished helping clients at a visiting point, they may have left by the time a new client arrives to be serviced. The clients must wait for the next cycle of visits. In the next Expenditure report the Committee is requesting clarity on this.

Ms Bronkhorst said she would do that.

Mr Bheki Maduna, DoL Chief Financial Officer, replied that both leases and government buildings are handled by DPW. The DoL relationship with DPW has been difficult. DPW had challenges. The DPW withdrew their approval delegations to provincial offices. This has resulted in quite of lot of administrative work being handled by the national office. This proved to be very difficult for DoL and other government departments. This has been normalised. DoL is now working with their provincial offices, but there are still challenges.

In terms of current finances, DoL has a capital allocation for buildings that belong to government. The DPW invoices 25% every quarter. DPW complained the amount collected is not enough to maintain government buildings. The DPW current proposal is to implement a user charge based on per square meter area, similar to the property industry but just for government. It has not taken off as yet. When the user charge was presented, some departments had a budget shortfall so they could not pay all the money for the user charge. They are currently working with National Treasury on this matter, as some departments had shortfalls. He hopes that this has been corrected in the current allocation DoL has received – to ensure that everyone receives the amount as proposed in terms of the user charge. DPW indicated once they get that user charge, DPW can maintain the government buildings.

Mr Maduna responded that leases are negotiated by DPW. DoL sends its request to DPW. DPW has been given some allowances to normalise the expired leases. There was a proposal to convert the month-to-month lease to a five-year or ten-year lease. This will follow a procurement process with National Treasury. All the leases that have expired have been handled by DPW on a month to month basis. The concern is that where DoL is occupying the building and has complaints with the landlord, the lease is between DPW and the landlord; DoL is merely the occupant. DPW has given DoL permission to do some emergency repairs that will probably be recovered from the landlord. DPW is supposed to manage and maintain the leases but has been having challenges for some time.

Mr Maduna replied about vehicles that in this financial year the RT contract by the Department of Transport (DoT) expired. As a result, there has been a delay in DoL procuring vehicles. Those offices which made a request for vehicles will receive them by the end of January 2019. Normally this process occurs around April or May in the financial year. As a result of the new tender the DoT issued, the finalisation took some time.

The Chairperson mentioned a challenge in that DoL should be managing these buildings. Somebody should be blowing the whistle at the right time. Inspectors should inspect the building at certain intervals and warn of matters to be addressed, so that the CFO is informed of the state they are in before the building is closed. If the Inspectors suddenly close a building it appears that they have not been inspecting them for some time. DoL has the right to do minor repairs, and the inspectors should give a warning of matters they would like to be addressed. If the inspector closes DoL’s own offices, something is not right.

The Chairperson referred to the poor contract management. The process should coincide so by the end of a contract, a new contract should have been signed. He said the CFO has an interest in these matters as equipment gets stolen. Where there is no official lease, the security of equipment is in jeopardy because the claim would be based on the building’s lease agreement. If the landlord and DPW do not have an agreement, the insurance will not pay out. There is a need to protect the interests of the Department. Reports should be submitted to the Director-General and Cabinet if DPW is not helping DoL, in order to find solutions. He referred to DoL using the Compensation Fund and UIF to obtain accommodation from the PIC. This might be the best way forward, so these problems with DPW are avoided, such as no lease since 2012.

Ms Van Schalkwyk said, in terms of resources, she had made an example of a vehicle, however she wanted to know about office equipment and so forth as well. She asked for a comparison of the amounts paid, between private owners and state-owned buildings. The presentation provided number of clients per month since April and she requested the information from the previous year for the same period. She wanted an indication whether more or less people, or the same, are accessing services since last year. This would give an indication of where to direct services, in terms of the Labour Centres. She wanted to know when the Khayelitsha satellite office will open.

Ms Bronkhorst replied about resources, saying the manager of an office will request resources. DoL supplied laptops and cell phones based on the request from the ground. She would give the information in writing along with the number of clients in comparison with last year, and the other information requested by the Chairperson. As to the move from Goodwood to Khayelitsha, she reported that management had said 1 April but she would confirm this.

Mr Maduna referred to the RT contract of DoT, whereby all government departments procure government vehicles. There were delays in finalising the procurement process on the part of DoT. The Department had made an order.

In terms of lease management, Mr Maduna replied that DoL is managing it quite tightly but the limitation is that DoL is not signatory to the contract. DoL management approaches DPW directly, and if they experience challenges, they escalate the matter to the Director-General. The relationship with the landlords is cordial. If matters need to be escalated then DoL has to go back to DPW, as the lease is signed between DPW and the landlords.

Mr Bagraim said this Committee complained four years ago about the lease for the Commission of Conciliation, Mediation and Arbitration (CCMA) in Cape Town. The CCMA still occupies the same building and one cannot utilize the toilet. He wanted to know what is happening there.

Mr Seafield replied that he would come back to Mr Bagraim

Mr Bagraim mentioned that there is a South African Human Rights Commission Report on Affirmative Action. The Minister had received the report yesterday. He requested a copy of the report for the Committee.

It was noted that the Chairperson would request the report.

Committee Report on the High Level Panel recommendations
Mr Sibongiseni Ngcobo, Committee Content Advisor, spoke to the report. He had already presented the report to the Committee, and the Department of Labour had presented its responses to the recommendations of the High Level Panel. He had put combined these into one document, which was before the Committee today. It was for the Committee to decide if there were further inputs or corrections.
Mr M Bagraim (DA) thanked the Content Advisor for the compiled report. He questioned the way the bullets on page 2 had been weighted. He indicated that unemployment should be the first bullet, taking precedence over the labour and regulatory environment, which should come second. Further, wage inequality is not a major factor for unemployment in the country. On page 3, dealing with causes of unemployment, the low levels of unemployment in agriculture was not a cause of unemployment; it is a symptom. On the bottom of page 3 he said the bullet points were structured incorrectly again. The Committee needed to re-look at those bullet points. On page 4, the bullet “Large proportion of the population located in rural areas” should be at the top. During apartheid they had been moved out to rural areas, and the Committee should highlight that as an issue. He wanted to restructure the report slightly to reflect the most important points higher up in the chain of bullet points. There are strong problems in the country unless this is tackled. The High Level Panel did recognise the importance of this.

Mr Ngobo replied that the bullet points appear in the same order as in the High Level Panel Report.

The Chair said as bullet points are not numbered so they have equal priority although it appears as though they are rated. In reference to page 5, clarity is needed as to whether the points have been extracted from the Report. If so, then one cannot restructure them.

Ms S Van Schalkwyk (ANC) suggested that it was only fair to refer this version of the Committee Report back to Members on condition that Members make proposals and recommendations and give them to the Committee Secretary in order to have a final version to look at next week for adoption.

This was accepted by the Committee.

Mr Bagraim suggested the deadline for proposals should be 5 November.

The Chairperson said that 5 November would give Members little time to consider other Members’ proposals.

Ms Van Schalkwyk suggested that adoption of the Committee Report be moved later than next week.

It was agreed the last day that Members can make proposals is 7 November.

The Committee Minutes of 24 October 2018 were adopted.

The meeting was adjourned.

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