Resolutions Adopted by the Inaugural Central Committee Meeting In Defence of our Jobs and for Job Creation 22 - 25 June 1998

 

Contents

INTRODUCTION

BROAD SOCIAL AND MACRO-ECONOMIC POLICY

MONETARY POLICY

FISCAL POLICY

TRADE AND INDUSTRIAL POLICY

Job creation


Export Processing Zones (EPZs), Spatial Development Initiatives (SDIs) and Industrial Development Zones (IDZs)


Black Business and Small, Medium, and Micro Enterprises (SMMEs)


Cluster studies


Pricing of raw materials


Local content


Investment


General Investment Policy


Multilateral Agreement on Investments (MAI)


Role of IDC


Competition Policy


State procurement policy


Tariff reduction and trade barriers


Customs and Excise


Trade


Southern African Region


Institutional transformation


Capacity building


Fisheries


Food Security


Energy Sector


Social plan for the mining sector


Technology

LABOUR MARKET POLICY

Implement Basic Conditions Act


Employment Equity Bill: Closing the Apartheid Wage Gap


Outsourcing


Labour Brokers and Independent Contractors


Wages


Training and Skills Development: Implementing the New Education and Training System


Scab Labour


Demands to improve minimum LRA provisions and Proposed Amendments


CCMA


Collective Bargaining Strategy and Centralised Bargaining


Affirmative Action, Sexual division of labour and Women's Empowerment


Health, Safety and Environment


Environment


HIV / AIDS


Child Labour


Parental Rights


Productivity and Competitiveness


Workplace Democracy and Re-organisation


Hours of Work


Capacity Building


Internal Organisation

UNION INVESTMENTS

Strategy


Code of Investments


Separation


Co-ordinating mechanism

PUBLIC WORKS

Start Public Works


Areas of Employment


Funding


Infrastructure Investment Plan


Principles Underlying Public Works

SOCIAL SECURITY AND SOCIAL WAGE

Improve Co-ordination in Government


Restructure Social Insurance


Extend the Social Security Net


Unemployment Insurance and Basic Income Grant


National Health System


Public Housing


Public Transport


Education and Training


Language Policy


Telecommunications, postal service, and broadcasting


Restructure Retirement Funds


Water Provision

TRANSFORMATION OF THE PUBLIC SECTOR

Sustaining and Building the Public Service


Local government


State Asset Restructuring

THE ALLIANCE TRANSFORMATION PROGRAMME

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Introduction

1. The 6^th National Congress delegated to this Central Committee all socio-economic resolutions. The powers of this Central Committee on socio-economic issues is therefore equal to those of the National Congress. This means it can change any socio-economic policy of the federation. Once policy is adopted by the Central Committee it can only be changed by the next National Congress in the year 2000.

2. This document attempts to integrate the resolutions received from affiliates with the other policy positions of the federation as adopted at the previous policy conferences (1992 Economic Policy Conference, 1993 Health and Safety Conference, 1995 Health, Safety and Environment Conference, 1996 Living Wage Conference and May 1997 Policy Conference).

3. In addition we also used the socio-economic section of the September Commission, Secretariat Report to the 6^th National Congress and Labour proposals on the Presidential Jobs Summit.

4. Where necessary we have used some of the policies adopted by the CEC and our submissions to parliament on various issues.

5. The approach outlined above was endorsed by the Central Executive Committee held on the 5 - 6 May 1998.

6. Only where it was absolute necessary for reasons relating to the correctness of the facts or cohesiveness of the document, the Resolutions Committee made changes to some of these policies. The Resolutions Committee changes are written in italics.

7. The section on Social Security, in particular retirement funds, State Assets Restructuring. Public Sector, Communications, Local Government, Water and Transport are all weak or in some cases have not been dealt with at all. Affiliates in discussing this document should seek to improve these sections. The Resolutions Committee will meet on the 19 June 1998. Affiliates should send their amendments to this committee so that we minimise time wastage at the Central Committee. A supplementary document shall be compiled and circulated at the Central Committee.

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BROAD SOCIAL AND MACRO-ECONOMIC POLICY

Vision

Socialism

Our Economic Policy must be guided by our political vision of socialism. The programme we articulate should be socialist-oriented and should define economic policy in terms of meeting the needs of citizens and further the culture of solidarity, community and social responsibility, open up the space for economic democracy and redistribute wealth, income, assets, opportunities and power.

Key strategic sectors must remain, or be placed in public hands. These sectors include:

1. Water

2. Education

3. Housing

4. Municipal services

5. Health

6. Energy

7. Communications

8. Land

We envisage an economy composed of the public service, a state sector, and a social sector. Property relations must be transformed in a way which favours the poor and the working class. We are therefore proposing a significant public and social ownership in the economy as distinct from private ownership.

Transforming of four sectors

Industrial development, redistribution and economic democracy should be implemented through specified transformation in different sectors of the economy. These sectors are:

1. The public service

2. The state sector

3. The social sector and

4. The private sector

The activist, developmental state

The state should be biased towards the working class and the poor. The state should act as a key economic agent. The state is the biggest employer, consumer and investor in the economy. Through fiscal and monetary policies and composition of its budget, it exerts a tremendous influence on the economy. An active, interventionist state is necessary to achieve our goals of economic development – in other words, to overcome poverty and redistribute power, wealth, income and economic opportunity from a small minority to the majority of the citizens. The state must progressively limit the power of capital

Link to the RDP

The RDP remains the cornerstone policy of COSATU. In many respects, the vision outlined in this document is a restatement of the fundamentals of the RDP. However, the RDP requires an additional set of concrete economic policies for implementing its vision. We seek to build the on RDP by outlining a coherent set of economic tools and strategies for achieving our vision.

Reclaiming Redistribution

The aim of economic development should be to overcome poverty. and inequality. The fundamental goal of economic policy should be redistribution and generating economic growth. Redistributive policies should focus on four goals:

1. Increase productive activity in the real economy, producing more wealth, creating more and better jobs and increasing the range and variety of economic opportunities and support structures for the citizens of South Africa.

2. Meet the needs of all citizens of the country – the need for work and income, for health, shelter, infrastructure, transport, education, decent childcare and provision for old age, as well as a high quality of community life.

3. Economic democracy (redistribution of power) – meaning the participation of the working class in determining the conditions of their economic activity and general priorities of economic policy.

4. Redistribution of economic resources through the payment of a living wage and improving the skills of workers; and increasing taxation on the wealthy and corporations to fund redistribution.

The focus of our economic policies should therefore be on:

• Industrial development in South Africa and the Region

• Public service delivery and

• Economic democracy and

• Redistribution

Broad Macro-Economic Approach

1. There are a number of key areas of macroeconomic policies which should support our vision and broader employment-creation strategy, these are listed below:

   1. Ensure that the parameters of fiscal policy are consistent with employment creation and retention strategies. Avoid imposing rigid and rapid deficit reduction targets which limit public expenditure and infrastructural development.

   2. Maintain and expand demand for domestically produced goods and services.

   3. Meet increased demand through an expansion of the productive capacity of the economy, which in turn would generate new jobs.

   4. Stimulate demand by lowering interest rates, pursuing redistributive fiscal policies, and developing effective strategies to boost exports.

   5. Create an environment conducive to boosting productive capacity of the economy. Increase state-led investment to ensure that increased demand can be met though domestic production, and not though greater levels of imported goods.

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MONETARY POLICY

Vision

1. Monetary policy is an important instrument in driving economic policies and delivery of social services. GEAR and government’s practices focusing on phasing out exchange control, high interest rates, preserving the value of the rand, and defending foreign exchange reserves will undermine productive economic activity, and make our economy vulnerable to speculators. There is therefore a need for monetary and interest rate policies to be urgently refocused in a manner that promotes the primary objectives of the RDP. Restrictive monetary policies need to be reversed in order to stimulate economic activity.

2. The state must play an active role in encouraging investment to achieve the objective of employment growth. Policies should be put in place to limit the mobility of capital and reduce the volatility in the economy due to rapid short-term capital investment.

Policy Proposals

Interest Rates

1. The federation reaffirms its rejection of GEAR and government’s macro-economic practices which entail:

   1. High interest rates;

   2. Advance a one-sided approach to cutting down inflation;

   3. Advance the mythical notion that the lack of investment in South Africa is the result of non-saving.

2. Interest rates should be substantially reduced. This will increase the purchasing power of consumers, facilitate the shift of capital from financial markets into productive investments, and substantially reduce the burden of public debt.

3. Alternative ways of addressing inflation need to be pursued through NEDLAC, and at a sectoral level. COSATU must advance a policy of differentiated rates so that projects benefiting the people and labour -intensive industrial development, are not prejudiced or made impossible by the policy of high interest rates.

4. The government and its institutions are to look at a broader approach to fight inflation and desist from using the blunt instrument of high interest rate to fight inflation. Such measures should include a broader approach to fight inflation without compromising collective bargaining; price controls; subsidies on basic needs; and industrial policy to stimulate the productive capacity of the economy.

Exchange Controls

1. Serious consideration should be given to the impact which the removal of exchange controls has on outflows of resources abroad.

2. The state should retain and introduce adequate measures to ensure that domestic assets are deployed in the national interest.

3. Mechanisms should be introduced to regulate capital movements, and to penalise speculative capital.

4. COSATU must link up with fraternal organisations around the issue of an equitable world monetary system

Regulation of Financial Sector

1. We note that a significant element causing the recent Asian currency crisis was the deregulation and liberalisation of the financial sector in those societies.

2. The financial sector should be restructured to facilitate the cheap financing of investment. The current statutory and regulatory requirements governing asset deployment of financial institutions should therefore be revisited.

3. The policy goal should be the deployment of assets in South Africa and not to move assets offshore.

4. We oppose the proposal of the Financial Services Board (in 1996) to permit movement of assets worth more than R50 billion out of the country.

5. The Financial Services Board needs to be restructured and its deliberations made more transparent. Labour should be fully represented on the Board.

6. The high costs of financial intermediation have to be reduced as they increase the cost of economic activity, result in job losses, and impede housing development.

7. Regulations must be introduced to stem capital flight.

The South African Reserve Bank

1. The constitution should be amended to explicitly commit the Reserve Bank, in implementation of its policies, to development and employment creation.

2. The Reserve Bank’s policies should encourage cheaper credit for targeted sectors.

3. The Reserve Bank Board must be restructured and democratised to include civil society representatives, including labour.

4. In addition, parliament should have an oversight over the broad objectives of the Reserve Bank policies. The legislation should further be amended to ensure that parliament is in a position to play an effective oversight role over the Reserve Banks broad policies.

5. The legislation and section of the constitution governing the Reserve Bank should be amended in order to put in place effective mechanisms which will see to it that the Reserve Bank acts in consultation with the Minister of Finance in determining monetary policy (including targeted inflation and interest rates).

6. It should be clearly stated that the purpose of such consultation and oversight role should be to ensure that the monetary policy is in line with and assists in advancing overall economic and development policy.

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FISCAL POLICY

Vision, Alternative Framework and Policy

Set an appropriate deficit

1. The government should avoid binding itself to specified deficit targets without first assessing their impact on service delivery, on the ability of the state to extend services to communities previously denied them, and on the institutional capacity of the state. We reject the obsession around the deficit reduction.

2. Reducing the deficit too quickly causes deflationary pressure on the economy and slows down economic growth and job creation. Low economic growth in turn discourages investment.

3. The achievement and setting of deficit targets should be annually reviewed.

4. The need to overcome the legacy of apartheid requires the expansion of state services and their improved quality, as well as substantial state investment in people and social and productive infrastructure. In other words, the state must increase its expenditure levels. The inherited apartheid budget which serviced a minority of the population cannot define the parameters of a budget which must serve the interests of all people, with priority given to the working class.

5. The deficit should be set within a flexible band. During times of high unemployment, and a large social deficit, the fiscal deficit necessarily will be higher than at times of high job growth and reduced social deficit

6. Until agreement has been reached on the above, an immediate moratorium should be placed on further reductions in the budget deficit, with effect from the 1999 / 2000 budget. The MTEF parameters must also be changed accordingly.

Increase targeted social expenditure for the poor / redistributive policy

1. It is imperative during the reconstruction phase for the Government to increase Government spending.

2. Much of the existing budget expenditure should be redirected towards the required services and infrastructure.

3. For such Government spending to be beneficially targeted priority areas should be identified based on the following criteria:

   • People development;

   • Crowding in of investment;

   • Possible income generation (direct and indirect);

   • Access to basic facilities and needs;

   • Redistribution of wealth and income.

   The following areas, therefore, should be prioritised:

• Housing

• Health

• Education

• Energy

• Public Transport

• Telecommunication

• Social Security

4. Embark on a massive housing programme to address the inherited backlog, over the next 3-5 years, focussing especially on building rental accommodation on well-located land.

5. A comprehensive social security net needs to be set up, including:

   • Expand quality health care for all, including the unemployed. A system of national health care should be put in place by no later than the end of 1999.

   • Measures for food security, including comprehensive feeding schemes

Expand tax revenue

1. Demands for a reduction in corporate taxes are based on the false assumption that South African companies actually pay high rates of tax.

2. South Africa’s tax revenue as a proportion of national income is lower than comparable countries internationally. A study of relative tax levels in 70 industrialised and developing countries suggests that South Africa’s tax should be increased from 25,7% of national income to 31% - an extra R25 billion at 1996 prices.

3. This means that South Africa’s poor are paying higher effective tax rates than other sectors of the population, and that the lower and middle income groups bear a disproportionate share of the tax burden.

4. The revenue target should be set within a flexible band. During the period of reconstruction and development, higher revenues are required from corporations and wealthy individuals. To this end government should introduce a solidarity tax.

5. All citizens should be registered for tax purposes.

6. In line with government’s proposal, all SMMEs which receive public contracts must be registered with the Receiver of Revenue.

Introduce a progressive tax policy

1. A new tax regime needs to provide an incentive to development, productive investment, and employment creation. Further, the tax structure should be used to promote the social sector.

2. COSATU believes that the tax system is still highly inequitable.

3. There is a need to reverse the declining contribution made by corporate taxes to tax revenue.

4. COSATU calls for a thorough ongoing review of the taxation system based on the following principles:

• All taxes should be progressive (low for the poor, high for the rich);

• Sufficient resources should be made available to ensure the efficient collection of taxes;

• The effective rate of corporate taxation needs to be increased through increasing the Secondary Tax on Companies and closing the loopholes in corporate tax.

• Increase the top tax rate for the super-rich.

• A capital gains tax should be considered to deal with individuals who are able to amass a large tax-free source of wealth. Some minimum threshold should be set whereafter a capital gains tax should be applicable. Careful consideration should be given to ensuring that the capital gains tax is structured to limit opportunities for tax avoidance.

• A land tax should be introduced to bolster a programme of comprehensive land reform.

• A special excise tax should be introduced on luxury goods. This should exclude basic electronic and white goods (fridges, stoves, etc.). As electrification proceeds, more poor families will require such basic commodities.

• We propose that the Department of Finance identify a list of such luxury goods, for submission to NEDLAC for discussion and negotiations.

Scrap consumer tax on basic requirements

1. No VAT should be payable on all basic foods, medicines, water, domestic electricity and education. This will offer effective, easily administered relief to the unemployed and to low and middle-income earners.

2. A varied rate should also be introduced, including a higher rate on luxury goods and a lower rate on household necessities.

Tax and Pensions/Provident Funds and Mutuals

1. There should be equal tax treatment of provident and pension funds.

2. The Smith Commission’s pension enhancement proposal for low income earners who participate in provident funds should be implemented so as to encourage savings and counteract the regressive effect of taxation on the earnings of the retirement industry.

3. On retirement, low-paid workers should be exempted from taxation on payout (those receiving lump sums in the region of R 100 000 or less). This should be subject to a ceiling to be negotiated. Those retrenched involuntarily should be exempted from taxation on retirement.

4. Savings can be encouraged through a National Provident and Pension Fund. Before this happens, workers should be able to transfer their funds between different sectors.

5. COSATU should develop a national trustee module to be carried out by Ditsela and NALEDI.

6. As pension and provident funds payments are understood to be employees’ deferred wages, employers should not have the right of access to pension and provident fund surpluses. Legislation should be amended to give effect to this.

7. The decision by Sanlam and Old Mutual to demutualise is an arrogant effort to escape policy-holder involvement in decision making. It strips policy holders of potential control over the mutual societies they built up and now opens the companies to normal share market transactions. COSATU should oppose the demutualisation programme of Old Mutual and Sanlam, though our own campaign, our work at an Alliance level, and in our work in parliament. COSATU will oppose current legislation providing for demutualisation. Legislation should be prepared to ensure a more favourable dispensation for Mutuals; to ensure legislative changes to their corporate governance, to give policy-holders, including group policy-holders, real control; and to effect higher taxes on former Mutuals who transform to normal publicly listed companies on the Stock Exchange. COSATU should campaign to ensure that the economic power of the Mutuals is harnessed to the benefit of South Africans, not as a vehicle for the enrichment of a few.

Reduce the Government Debt Burden

Internal Debt

1. The size of South Africa's debt is being used to frustrate the programme of transformation. The extent of the debt has been artificially inflated. However, concrete steps can be taken to drastically reduce the debt burden.

2. Government’s debt increased from R80 billion in 1989 to R337,6 billion in March 1998 which is 55% of the GDP. Two thirds of this debt was deliberately created in the 1990’s and used by the NP’s cruel government to finance the end of the apartheid government including paying out golden hand shakes to its generals.

3. Out of a total of R205 billion in government spending in the 1998/9 national budget, some R43 billion will be interest payments to service the debt. This should be compared to R88 billion to be spent for all social services.

4. A staggering 95,6% of this debt is made up of internal debt with foreign debt, at 4,4%. The internal debt is made up of the following:

   • Public Investment Commissioners (mainly from public sector pension funds but includes parastatals) = 40,0%

   • Reserve Bank = 4 %

   • Banks = 7 %

   • Insurers = 16 %

   • Private and Pension Funds = 4 %

   • Others (holdings by house holds, private business, charities) = 28,1%

5. The current "fully funded" pension system means that the following contributions are made to the public sector pension fund each year:

   • Government’s contribution as an employer = R9 billion

   • Public employees contribution = R4 billion

   • Interest payment on pension fund debt = R18 billion

   • Total payment into the fund = R31 billion

6. 40% of government’s debt of R337,6 billion consists of the public service pension fund debt, on which costly interest payments have to be made.

7. It is estimated that pay-outs from the fund each year amount to R13 billion. This means that an additional R18 billion rands is paid into the fund as part of the "fully funded" pension system.

8. A pay-as-you-go system should be introduced in the public service pension fund, thereby freeing R150 billion in interest bearing debt. This would release roughly R18 billion a year which in turn will reduce the deficit by 76%. This additional money can be used for investment and to strengthen the government’s capacity.

9. Movement to the pay as you go public sector pension fund needs to happen as a matter of urgency. A final decision on this matter needs to be taken before the end of 1998.

10. High interest rates are not only hurting workers, consumers, and smaller job-creating firms but also increase the government debt. Moving to a Pay as You Go pension fund will reduce pressure on interest rates. Other measures should also be taken to reduce interest rates, including though acting against bank collusion.

11. The government should look critically at the internal debt repayment in terms of the period and interest rates and re-evaluate those that were used to destroy underprivileged communities. Government should investigate other sources of borrowing that would not lead to an escalation of interest rates and should also explore creating its own institutions of borrowing.

External Debt

1. "The odious debt" (foreign debt which makes up 4 % of the total debt) incurred by the previous government has to be reviewed. Government should provide information on who the foreign debt is owed to, and for what purpose the money was borrowed.

2. This foreign debt should be scrapped.

3. COSATU should actively support the international campaign against foreign debt, and the scrapping of debt owed by the poorest nations.

Budget Process

1. Part of the historic commitment of the liberation movement that "The people shall govern" means that parliament – as elected representatives of the people – should be empowered to play an effective oversight role with regards to the budget.

2. Therefore, legislation empowering parliament to amend money bills such as the budget, should grant significant powers to parliament to increase and decrease individual department’s budget votes, to introduce expenditure items into the budget and to effect changes to Bill’s imposing taxes, levy’s and duties.

3. In addition to the parliament’s oversight role with regard to the budget, it is important that there be broader participation in the process of drawing up the budget. Such participation could be facilitated through discussion on the proposed budget.

4. The trade union movement must participate from the beginning of the 18 month budget cycle. Alliance mechanisms must be developed to guide the budget process.

5. The Medium Term Expenditure Framework (MTEF), its parameters and its underlying economic assumptions must be renegotiated in parliament and at NEDLAC. There is no contradiction between such an increased consultative process and parliament having ultimate oversight over the entire process.

6. An expenditure programme should be fixed in the MTEF and irrespective of fluctuations in the GDP level, these expenditure levels should be pursued. GDP fluctuations should be absorbed by varying the deficit and revenue levels within the identified bands.

7. In terms of allocation of revenue to the provinces, reference to the debt should be removed from Section 214 (2) (b) of the Constitution, since this should not be given priority over other national obligations.

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TRADE AND INDUSTRIAL POLICY

Vision

1. For COSATU, industrial policy is not confined to promoting exports. Such a policy will have limited success. We reject GEAR and free market purity as being inappropriate to address the socio-economic and political ills of South Africa. Market forces on their own will not build efficient and dynamic industries and they will not maximise the national social and economic interests.

2. Instead, we propose the creation of an activist, developmental and interventionist state for carrying out the task of social and economic transformation. This state must be biased to, and seek to advance the interests of, the working class in policy formulation and implementation. The democratic state must recognise the inherent historical imbalances in social and economic power relations and must therefore pursue a sustained programme to shift the balance of power in favour of the working class and the rural poor, who constitute the main motive forces for fundamental transformation.

3. An interventionist policy should build efficient and dynamic industries without ignoring the need to address national social and economic interests. An interventionist approach could, for example, employ taxation sticks and incentive carrots to encourage industries to invest in education and training.

4. The industrial policy that the new democratic state pursues must integrate Southern Africa as an integral part of our reconstruction and development strategy.

5. Furthermore, it is recognised that over the years the mining industry has declined relative to manufacturing and services. It however remains vital, together with other sectors, for the South African economy and will remain so for years to come. Our trade and industrial policy must thus have a long-term social plan approach that anticipates the gradual downscaling of mining and manufacturing as well as other sectors of the economy.

6. The fundamental objective of industrial policy should be a significant increase in the number of quality and sustainable jobs and full employment. Other objectives should include the following:

   • To lower the costs of production of basic goods and services to meet redistribution needs through increased efficiency, particularly through new investment, skills, technology, management systems, and in work organisation.

   • Industry must produce high quality basic goods and services at prices that are affordable to everyone.

   • We need to develop and sustain domestic consumption, with an emphasis on consuming products with high local content.

   • Industry must be capable of paying a living wage to workers and have an equitable wage structure that seeks to narrow the wage gap.

     Industry must contribute to the development of human resources of our society.

   • Our objective in regard to trade should be policies that ensure that trade contributes to full employment and fair labour standards in all countries.

   • Industry must ensure it implements environmentally sustainable policies including healthy and safe working and living conditions.

   • Since South African industry will have to function in a world wide economy, our objective in relation to the world economy should be that our costs and prices should compare favourably with world costs and prices, but to do so without cutting labour standards.

   • We need a general rise in productivity that will narrow the adverse price, quality and technology gap between products manufactured on world markets and those manufactured in South Africa. We need also to develop our economy’s capacity to beneficiate and process new materials through manufactured processes. These policies will create a wider capacity for the successful production for domestic markets and export of manufactured products and beneficiated products.

7. To achieve these objectives, we should negotiate and campaign at national, regional, industry and company level around the following:

   • Restructuring of the economy and industries. Particular attention should be paid to:

     • Labour intensive production.

     • Maximising the potential for beneficiation of our natural resources.

     • Ensuring sustainable growth.

     • Stopping the outflow of capital

     • The allocation of investment funds by government, the financial system and companies.

     • The use of technology and the increased use of Research and Development.

     • An appropriate tariff and trade policy.

   • The setting up of a publicly funded National Restructuring Fund (which should be a tripartite body) to finance the introduction of new technology and work organisation, in instances where companies are able to show expanded output and creation of new jobs.

   • The passing of legislation to break-up conglomerates and monopolies where necessary in order to ensure economic efficiency and growth and to reduce their economic power.

   Sources: NUMSA, NUM, SACTWU, SADTU, Social Equity, Economic Policy Conference 1992, September Commission, Labour Job Summit document, Parliamentary submission on industrial policy 1998.

Policy Proposals

Job creation

In defence of jobs:

We need to put strategies in place that protect and restructure existing industries while laying the groundwork for new areas of employment, which includes a social plan.

1. We need to maximise the impact of those sectors which are job creating, including the service sector. Industries which can serve as an engine for job creation in South Africa must be identified, and such an analysis must extend beyond identifying labour intensive industries. In addition, the down-stream and up-stream linkages (e.g. between companies which supply components to the sector or distribute the product manufactured) must be identified and actively promoted.

2. Supply-side incentives should be explicitly linked to job creation. Such job creation should be new jobs, in compliance with minimum labour standards, and not just transfer of employment from existing workplaces. Supply side measures which are currently in place (e.g. those linked to export promotion or technological innovation), should be evaluated and implemented taking into account their employment-generating effects. Punitive supply-side measures can also be introduced, for example tax disincentives to job shedding.

3. The state should use a fiscal strategy that introduces and promotes productive development projects.

   Source: Labour submission to Job Summit, FAWU, SACTWU, SADTU.

Export Processing Zones (EPZs), Spatial Development Initiatives (SDIs) and Industrial Development Zones (IDZs)

1. COSATU remains opposed to EPZs as they downgrade labour standards. We should vigorously oppose attempts by business and government to establish EPZs.

2. With regard to existing investment incentive schemes such as tax holidays and proposed schemes such as the Industrial Development Zones, mechanisms must be put into place to ensure that new investments do not have the effect of displacing the jobs of currently employed people without creating additional jobs. If the effect of these schemes is merely to displace those presently in employment as enterprises are unable to compete with new, subsidised (the effect of not having to pay tax) enterprises, then there will be no positive net job creation, only an unnecessary decline in tax revenue and increased pressure on the budget deficit. In instances where IDZ or spatial development initiatives encourage capital intensive projects, this should only be permitted on the basis of clearly specified projections of up-stream and down-steam job creation and measures to realise these projections. Monitoring mechanisms must be put into place to see to it that these projections are indeed met. Mechanisms must also be put in place to ensure that SDI's and IDZs do not simply become EPZs with a different name.

3. In engaging those who propagate the concept, the following principles should underpin our engagement:

   • Community participation in the project development and trade union representation on the management boards of these areas.

   • Capacity building as it relates to human resource development and training programmes.

   • Diversification of investment to avoid possible failures.

   • Backward and forward linkages to stimulate local and regional industries to such zones.

   • Guaranteed labour standards and full compliance with ILO standards, the extension of Bargaining Council agreements to these areas, and no exemptions to labour laws. Workers should be mobilised to ensure that these standards are actually met.

   • RDP-based development.

   • Department of Trade and Industry proposals that Industrial Development Zones focus primarily on export promotion should be reconsidered. There may be numerous benefits which would flow from focussing aspects of IDZ activity on the expansion of production for the domestic and broader Southern African market

   • SDI’s and IDZs should not be used by industries/companies to merely relocate.

   These points should be negotiated at NEDLAC.

   Further discussions on these issues will be taken up in structures of the federation, particularly in a meeting of the regions.

   Source: NUMSA, FAWU, SACTWU, TGWU, Parliamentary submission on industrial policy 1998, Labour submission to Job Summit

Black Business and Small, Medium, and Micro Enterprises (SMMEs)

1. Employers are hell-bent on implementing business ventures under the pretext of the empowerment of previously disadvantaged groups.

2. SMMEs can play a crucial role in the social and economic development of the country if they operate correctly.

3. A "National Policy Approach" should be developed in order to ensure that we have a coherent approach to SMMEs. In developing this policy, our support for SMMEs should be based on the following: creation of jobs; economic empowerment for the participants; and fostering of good labour practices in the SMME sector.

4. In this context, we will not support SMME development in relation to subcontracting activities for the following reasons:

   • Such activities do not generally create new jobs, but rather displace existing unionised labour with jobs that offer lower labour standards;

   • Where the sub-contracted activity is linked especially to a particular company, the sub-contractor is often highly dependent on the particular enterprise, which limits the depth of the economic activity;

   • It creates a conflict in the workplace.

5. Our approach should be to prioritise SMME development in workers’ community or workplace context, to try to identify new products or services that are not currently being provided.

6. Government should provide incentives to SMMEs but not at the expense of workers. Instead it should be linked to compliance with labour standards and tax requirements.

7. SMMEs should be used as a tool for collective empowerment instead of self-enrichment.

8. To campaign that any special affirmative action for black business must be linked to respect for workers rights.

9. COSATU should meet with black business organisations to discuss the implementation of fair and progressive labour practices and policies.

10. Government must ensure anti-discrimination measures amongst financial institutions to facilitate easy access to credit for the SMMEs market. Where such anti-discrimination measures do not generate enough credit to SMMEs, government must provide easy access to financial support.

11. There is a need for NGOs and other financial intermediaries to increase their capacity since it is currently insufficient to meet the needs of the SMME market. Here government needs to play an active role.

12. The resolution on campaigns should deal with a campaign regarding the credit bureaux.

    Sources: SACTWU, SASBO, NUMSA, FAWU, NUM.

Cluster studies

1. A process with potential for union influence is the cluster study/development process.

2. Cluster studies should be needs driven and linked to RDP initiatives, for example, housing delivery programme (finished product determine the establishment of clusters).

3. We reject the notion of export-driven studies at the expense of developing the domestic market.

4. All affiliates must make it a priority to participate proactively in this process.

5. Our participation in the cluster studies should be to defend the interest of workers, and secure workplace transformation.

6. Affiliates in a sector should meet with the DTI sectoral bureau for that sector, to discuss plans and processes for sectoral industrial strategy.

7. Through such involvement, the industrial policy team can start to think about an ‘industry plan’ for its sectors or subsectors.

8. Such an industry plan should include a component on a strategic trade policy (including appropriate tariff policies) to foster sectoral growth.

9. COSATU should secure funding (from IDC, DTI, Fund for Research into Industrial Development, Growth, and Equity (FRIDGE)) for training and capacity building for union representatives participating in these structures.

10. COSATU and affiliates should develop report-back and mandating mechanisms throughout these processes.

    Sources: September Commission, NUMSA, FAWU, SACTWU.

Pricing of raw materials

1. The high price of raw materials is a major restriction on the ability of higher value added industries to become internationally competitive, e.g. ISCOR's steel.

2. Government can change this both through its ownership (through IDC) and policy approaches such as:

   • Import/export controls on strategic materials (energy, steel etc.),

   • Costs and efficiency of transport (rail, road and shipping policy) and communications,

   • The use of environmental and design regulations,

   • Exploration permits and mineral and energy policy.

3. Infrastructure development will have a major positive impact on both basic living conditions and foreign exchange earning industries, particularly tourism.

4. Government's interventions should be biased towards meeting of the basic needs of our people.

   Source: NUMSA

Local content

1. We reject the current relaxation of the local content provision as it has led to the collapse of a number of industries.

2. An industrial policy must have a local content provision in the final product.

   Source: NUMSA

Investment

Investment code

1. An Investment Code should be implemented which requires prospective investors to:

   • Invest in boosting the productive capacity of the economy.

   • Invest in labour intensive sectors that create jobs.

   • Emphasise training and skill development.

   • Abide by all ILO conventions on minimum standards.

   • Abide by social and labour laws and regulations and the constitution and all existing legislation of South Africa as a minimum, and actively implement improvements to these. Where companies operate in decentralised areas, they will need to abide by national social and labour standards.

   • Disclose information.

   • Facilitate transnational contact between shop stewards.

   Employment creation:

2. Companies will endeavour to increase employment opportunities as a priority in harmony with national social development policies. They will use technologies which generate employment, both directly and indirectly.

3. There is also a need for foreign companies producing goods in South Africa to be jointly owned by South Africans and/or government, to ensure the distribution of profits within the country.

   Sources: NUMSA and Economic Policy Conference 1992, FAWU, SACTWU.

General Investment Policy

1. Some key policies which can boost productive investment and encourage employment creation are:

   • Expanding the production of infrastructure and public investment in the economy.

   • Lowering interest rates, which can have a substantial impact on investment in an economy.

   • Create a stable economic environment. This must not, however, require pursuing highly restrictive macro-economic policies or a repressive labour relations regime.

   • Give women access to financial resources. Develop small-scale lending programmes to ensure that women can access financial resources.

   • Establish capital controls. Discourage unproductive, speculative investment and limit damaging capital outflows. Use measures such as exchange controls, taxes on speculative investments, and short-term capital gains taxes.

   • Focus on parastatals as key investors.

   • Financing and credit relationships between finance and industry must be reformed with an aim to building relationships which promote job creation. Directed credit and differential interest rates could be used to help foster such changes.

   • Prescribed assets and control over pension funds and the financial sector. Implement a policy of prescribed assets to channel investment funds into job-creating opportunities. Local investment socio-economic upliftment programmes should be prescribed through 10% of retirement funds.

2. There should be increased investment in research and development, co-ordinated with research institutions.

3. COSATU should lobby government to conduct an in-depth investigation of the financial sector and how to ensure channelling of financial resources into industrial development.

4. Mechanisms must be put in place to ensure that investments flowing from industrial participation (counter-trade) schemes, linked to armaments procurement, be channeled into labour intensive, job creation activities which also encourage skills transfers and general socio economic upliftment. Participatory procedures need to be put in place to ensure labour’s participation in such industrial participation schemes

   Source: Labour Job Summit document, NUMSA, Parliamentary submission on industrial policy 1998, September Commission, SACTWU.

Multilateral Agreement on Investments (MAI)

1. The Multilateral Agreement on Investments (MAI), which originated in the Organisation of Economic Development (OECD) and may soon be part of the agenda of the World Trade Organisation (WTO), is designed to further strengthen the power of transnational corporations throughout the world. It poses a grave threat to the ability of nation-states to serve their citizens, and can further relegate the status of developing countries to that of "wholly owned subsidiaries" of the TNCs.

2. MAI represents a single most serious threat to the sovereignty of independent nations. Its provisions amount to an international bill of rights for multinational corporations.

3. COSATU should join the growing international campaign against the MAI

4. Government should be urged to use its upcoming chairpersonship of the Non-Aligned movement (NAM) to mobilise further opposition to the MAI, and to support the view that an entirely new investor agreement be negotiated, with full participation from developing countries and civil society and based on respect for fundamental worker rights, and the sovereign right of parliament to pursue national development goals..

   Source: Resolutions Committee, SACTWU.

Role of IDC

1. Job creation should be the primary mandate of the IDC.

2. The IDC needs to be re-oriented from its focus on capital intensive mega-projects to incorporate labour intensive projects as well

3. In addition to the allocation of funds from the investment portfolio of the IDC, the full pre-tax profit of the IDC should be applied to job creation ventures.

4. Private sector investments in partnership with the IDC should be required to invest in job-creating investments.

   Sources: Social Equity, NUMSA

Competition Policy

1. There is a need for far reaching changes to the corporate structure in South Africa.

2. Competition policy needs to form part of a broader industrial strategy.

3. Competition Policy should be informed by the following objectives:

   • To reduce concentrations of power which enable a handful of individuals to wield undue influence.

   • To see to it that workers' interests are taken into account, in particular potential for job loss must be an important criteria in the regulation of mergers and acquisitions.

   • To ensure "fair" pricing, in particular for basic goods.

   • To move towards worker ownership and control.

   • To enable the state to intervene decisively in regulating enterprise structure and conduct in the public interest, and

   • To facilitate, as part of a coherent industrial strategy, the production of surplus and its distribution in such a way that the economy develops and grows.

4. Any competition policy should not lead to job losses, down-grading of labour standards and deterioration of social welfare.

5. We support the forced unbundling of apartheid-era conglomerates where this is in the public interest on the basis of their over-concentration of particular markets. Further the potential should exist for forced divestiture to be triggered as soon as large firms abuse their dominance against their workers or consumers.

6. We support the inclusion of a regulated Ministerial discretion in regulating mergers in the public interest in order to avoid job loss and to protect domestic industry from predatory activity by Multi National Corporations operating in the global economy.

   Sources: Social Equity, NUMSA, Labour submission on Competition Policy, April 1998 CEC, SACTWU.

State procurement policy

1. State Procurement Policy needs to comply with the following conditions:

   • The policies must not be used to keep firms alive which fail to meet minimum standards. These standards should stipulate the participation of labour in the decision phase;

   • Policies must be transparent so that corruption can be eliminated;

   • Establishing competitive relations between firms may not be the most effective policy;

   • Decisions should not be made simply on the basis of the goods or services supplied, but also the production process etc.; production of labour intensive goods should be prioritised e.g. through prioritising labour intensive production;

   • Centralised purchasing can only be relaxed after basic standards have been achieved;

   • The establishment of national markets should not be jeopardised by misguided regional, local or agency devolution;

   • Assistance should be provided for new or innovative firms which are considering tendering;

   • Preference should be granted to those companies which are expanding production for both the domestic and export market.

   • Purchasing policy should be tied to research and development efforts.

   • Procurement policies must have provision for local content.

   • Counter trade agreements must not violate the provisions of industrial policy.

   • Trade agreements, bilateral agreements, ministerial declarations, and/or protocols must not negate the provisions of the industrial policy.

2. A Workers Rights Index should be developed, and companies tendering for public and private contracts should be required to report on compliance with the standards in the index. These standards should include the following core areas:

   • No employment of scab labour during legal strikes

   • Participation in centralised bargaining institutions where these exist

   • Contribution of a minimum of 4% of payroll towards training programmes agreed to with the trade union movement.

   • Implementation of a 40 hour working week.

3. The WTO is currently discussing neutralising these procedures as instruments for fostering domestic industry. The government should remain a non-signatory to the WTO's Procurement Policy so as to avoid parastatals e.g. Eskom, Telkom, purchasing equipment abroad.

4. COSATU should lobby government to take a stronger stand against the WTO Procurement Policy at WTO debates. The government should ensure that there is tighter coordination on these matters with the third world countries (developing and underdeveloped) to build a uniform stance against these unfair provisions pushed by some of the powerful developed countries.

5. The government should also reject the OECD's proposed Multi-lateral Agreement on Investment (MAI) so as to encourage expansion of domestic production and to avoid obligations where government and parastatals will be required to purchase equipment from abroad. Further, on the basis of procurement policies and in the furtherance of other objectives, government should campaign against the proposed MAI and the proposed US Growth and Opportunity Bill in line with a policy of working towards a transformed WTO and other multi-lateral global institutions.

   Sources: NUMSA, NEHAWU, NUM, Social Equity, September Commission, Parliamentary submission on industrial policy 1998.

Tariff reduction and trade barriers

1. Tariff reduction without supporting policies in affected sectors leads to job losses.

2. An immediate moratorium on any further reductions should be imposed, particularly for those sectors that are geared towards the support of the RDP.

3. Tariffs should not be reduced at a rate faster than that required by our obligations to the World Trade Organisation; We object to government's tariff reduction faster than its own obligations in terms of GATT.

4. Where South Africa has lowered individual tariff rates to below GATT commitments and these have resulted in job losses, these must be increased up to the GATT binding rate.

5. Tariff reduction should be preceded by active industrial policies to promote efficiency.

6. An audit of the effects of tariff reductions on particular sectors or industries must be carried out under a tripartite forum funded by the IDC. This forum would also make proposals to renegotiate the agreement with the WTO as well as assess the impacts of foreign policy on trade agreements.

7. The Social Plan with its social adjustment packages should be implemented at sectoral level, especially in those industries facing tariff reductions and downscaling. Concrete social adjustment programmes to transfer workers into new jobs must be introduced if tariff reduction leads to retrenchments.

8. Government should use tariffs strategically to protect jobs and promote industrial development.

9. The current EU and SADC negotiations on tariffs for sensitive industries exclude labour representatives. COSATU strongly condemns this, and the revision of mandates without any discussion with affected workers. COSATU calls for an immediate review of these negotiations to ensure no job losses in South Africa. Trade union representation in the negotiations with SADC and the EU is required, particularly from affected sectors.

10. COSATU should network with progressive movements to ensure international solidarity action and campaign against trade relations unfavourable to the poor countries.

    Sources: NUMSA, FAWU, Social Equity, SACTWU, Labour submission to Job Summit

Customs and Excise

1. We are experiencing job losses through illegal goods entering our markets and the dumping of goods on our markets.

2. Finances should be made available or in the next budget to increase staffing and systems to collect more taxes and prevent illegal goods entering the country.

3. Customs and excise institutions are still managed by corrupt officials from the old guard. They need to be transformed, including:

   • Changes to reflect the population, composition, to increase the efficiency of the system and to conform to the needs of our economy.

   • Increasing the resources at ports of entry, computerising all ports of entry, and ensuring that information is provided on a timely basis;

   • Establishing the norm of a minimum of 5% of all consignments being checked and specifically applying this target to each employment-sensitive sector;

   • Providing for product-dedicated ports of entry;

   • Beefing up the invoice analysis auditing programme;

   • Providing effective control over exports of goods subject to incentives;

   • Setting up resourced border posts with the BLNS (Botswana, Lesotho, Namibia, Swaziland) countries and airport inspection posts;

   • Increasing the number of inspectorate posts and the rate of container inspections;

   • Increasing the quantum and flexibility of remuneration packages for technically skilled customs staff;

   • Rotating customs staff between different posts;

   • Utilising private sector technical assistance for customs related activities;

   • Increasing and publicising rewards for information leading to successful prosecutions;

   • Raiding the warehouses of suspects and publicising the names of companies found guilty of fraudulent customs and clearance transactions;

   • The replacement of corrupt officials, who should be charged with the crime which they have committed; and a monitoring structure with labour representatives must be established;

   • Structures in government e.g. Board of Tariffs and Trade must be strengthened and restructured to be tripartite in character, to ensure proper monitoring of dumping and effective action to ensure that it does not take place.

   • To ensure that integration in SADC has a pre-requisite that effective customs controls be placed on all external borders and ports of entry.

     Sources: NUMSA, SACTWU, CWIU, NUM, Social Equity.

Trade

1. An active trade policy should specifically target incentives, and supply-side measures, e.g. skills training to those industries that create jobs directly, or either up-or-down stream of the targeted industry.

2. Both import substitution and export promotion should be pursued. Production for the export market often tends to be less labour intensive and therefore in those instances create fewer jobs than production for the domestic market. Import substitution will also stimulate the domestic production of intermediate (inputs used in the production of final goods) and capital goods (machinery) which will also have large employment effects.

3. Expansion through import-substitution operates through reducing the propensity to import, reducing leakages from the domestic economy. The objective of such an expansion in an underemployed economy is to reduce the propensity to import competitive goods. Specific strategic sectors must be targeted for a concerted programme of import substitution. The chief criterion in selecting these sectors must be their ability to generate sustainable employment.

4. Any anti-import substitution bias which may be prevalent in existing industrial policy measures should be worked out of the system. In addition to encouraging domestic production and expanding the domestic market as more people are drawn into employment, a carefully managed import substitution strategy can have the benefit of improving the balance of trade and taking pressure off the balance of payments.

5. Unfairly subsidised imports into South Africa should be stopped. We should make increased usage of anti-dumping and safeguard duties. It is crucial that safeguard duties take national interests into account. Job losses resulting from a sudden increases in imports should be prioritised when implementing safeguard duties to protect the domestic industry.

6. Rules of origin provisions should be implemented. In the event of SADC becoming a single market, which would allow for the free movement of goods across boarders, one way to protect South African industries and develop the economies of SADC countries would be the impose rules of origin. This would mean that countries have to prove that the goods they are exporting consist of, for example, 25%, 50% etc. of domestic production.

7. A social clause should be implemented. This would serve to discourage countries from competing on the basis of labour repression, exploitation and poor or non-existent health and safety standards. A number of SADC countries are already using such strategies to improve competitiveness. Malawi, Mauritius, Mozambique, Namibia and Zimbabwe already host or are in the process of establishing EPZs.

8. It should be a mandatory pre-requisite that 'employment impact assessments' should be carried out and published before South Africa can bind itself to any trade agreements.

9. We seek representation for the trade union movement in the international trade negotiations, including direct representation of labour on the negotiating committees concluding bilateral and multilateral trade deals.

10. Parliament should be given an effective overseeing role on trade negotiations.

11. The WTO should become a tri-partite structure, and should have compliance with the social clause as one of its requirements for a country. Trade unions internationally should form a common front in dealing with the WTO.

    Sources: Parliamentary submission on industrial policy 1998, Social Equity, Labour submission to Job Summit, SACTWU.

Southern African Region

1. Growth in South Africa without growth in Southern Africa would be counter productive to all. The poverty in the surrounding countries would rapidly undermine progress in SA whilst at the same time denying our economy a viable market closest to its borders. South Africa's economy and particularly its labour market are impossible to separate from the Southern African region. South Africa enjoys a substantial trade surplus with the SADC and SACU countries. It is necessary for the region to develop a focus to expand the regional market, and to develop balanced relations within the SADC community and externally. In addition, regional integration should not focus only on economic policy, but should also deal with issues of social development.

2. In developing sectoral industry policies we should be conscious of the potential for co-operative development, with linked supply chains between countries, and complementing industrial policies.

3. A regional reconstruction and development plan for southern Africa must be developed through a regional summit of governments and trade unions.

4. TheSouth African government needs to initiate a process to negotiate a set of minimum standards to be established across the whole region. COSATU should support the struggle for decent labour standards in all countries in the region.

5. To achieve general growth and development for the whole sub-continent requires mutually beneficial agreements to be reached between the countries concerned. Such co-operation should be underpinned by solidarity between trade unions in the sub-continent.

6. COSATU should propose a Regional Development Bank.

7. South Africa needs to play an active part in the development of the Southern African economies through the collective action of public enterprises (e.g. transport, utilities) to increase regional economic growth. COSATU should support a programme of infrastructural development projects, especially those which link two or more countries of the region, such as the Maputo corridor, based on clearly defined criteria.

8. A regional trade union solidarity fund, with R20 million a year, made available by all governments in Southern Africa, for programmes by the labour movement in the region should be set up.

9. COSATU affiliates should establish firm links with their counterpart unions in the region, with the aim of analysing the problems in their sectors and developing ideas about how their industries could be developed in a mutually beneficial way across countries. Affiliates should establish cross-regional company shop steward councils to build solidarity. COSATU should also assist unions in the region to develop their organisational, research and educational capacities.

10. COSATU should campaign for a SADC which is a based on upward convergence of social and labour standards, and the setting up of a Southern African Development, Labour and Economic Council (SADLEC), with representation by trade unions and community groups. SADLEC should serve as a forum to negotiate the terms of social and economic policies for the integration of the Southern African region.

    Sources: NUMSA, NUM, Economic Policy Conference 1992, Social Equity, September Commission, SACTWU.

Institutional transformation

1. All industrial policy-related state and parastatal institutions need to be restructured and reoriented. Such restructuring needs to go beyond changes in composition and representivity, and needs to position such institutions as tools in the meeting of the objectives outlined in our vision.

2. COSATU needs to develop a consistent strategy in relation to the IDC, the DBSA, NPI, the Land Bank and NOSA. The federation should initiate discussions with the relevant ministries (Trade and Industry, Finance, Labour, Agriculture) and the institutions themselves about their restructuring (or in the case of NPI and NOSA, their possible closure) and labour representation on their boards. Each of the boards should contain nominees from labour.

3. The Board of Directors of the DBSA should include trade union representatives and community representatives.

4. Researchers should be seconded to the DBSA, joint projects could be explored and the DBSA should be accountable to NEDLAC as well as parliament.

5. The boards of the IDC and other relevant institutions should be required to publicly report on a six monthly basis on the impact on employment, and the net number of direct jobs created, by its investment and technical assistance policies.

6. The resourcing of the IDC and DBSA should be guided by their success in fostering labour intensity and employment creation.

7. CSIR resources as well as public funding for research and development should be directed to labour-absorbing sectors and processes.

8. Both the national state tender board and particularly the provincial tender boards need to be restructured and an immediate commission of enquiry to investigate contracts that have been awarded. If any government employee is found to be guilty of colluding with parties to get the tender, she/he should be criminally charged. Laws should be passed to enable this to take place. Representation in the provincial tender boards should be based on the same model used in the national State Tender Board.

9. Institutions such as SBDC, MDC, and SABS should be streamlined to promote the products or programmes which could be developed for the purpose of establishing co-operatives.

10. The industrial development programme should be such that co-operatives can rise to be efficient and dynamic by world industrial standards.

    Sources: September Commission, NUM, NEHAWU, NUMSA.

Capacity building

1. COSATU must develop greater capacity to co-ordinate policy formation and engagement on industrial development issues. COSATU should concentrate on co-ordinating and building the NEDLAC team in the trade and industry chamber and the parliamentary office’s interventions on industrial policy issues, as well as supporting affiliates which are engaged in specific Campaigns over industrial development issues.

2. Resources must be made available at NEDLAC to develop the capacity of labour to engage more effectively in industrial policy development in the Trade and Industry Chamber, including through the employment of labour researchers in this area.

3. Every affiliate should establish its own industrial policy department or team, to develop industrial policy, participate in COSATU industrial policy processes, and engage with employers, NEDLAC and government. COSATU and affiliates should develop industrial policy teams to drive the development of policy in each sector. This would require demarcation of various sectors, and co-operation between relevant affiliates, e.g. in the energy sector. These sectoral teams should cover industrial development both in the public and private sectors.

4. NALEDI should establish an industrial development research capacity. This could provide research and policy support to COSATU and affiliates. In addition, we recommend that NALEDI convene an industrial policy reference group consisting of trade unionists – from affiliates and COSATU involved in industrial policy, to collectively develop strategies and Guide research. COSATU should consider a longer-term research project, housed in NALEDI, to assess industrial development strategies, based on an evaluation of international comparative experience, with a view to developing a vision for long-term industrial development in South Africa. In particular, NALEDI should be commissioned to undertake research on SDIs and IDZs which will feed into the federation’s discussions on the issue.

   Sources: September Commission

Fisheries

1. COSATU accepts the new Marine Living Resources Act which offers the potential for meaningful restructuring of the industry.

2. COSATU will work with the Alliance and other progressive forces to ensure that access to, and the allocation of marine resources are in line with the RDP and addresses the historical imbalances of the past.

3. The restructuring of the industry must also, in the main, promote our strategy of SMMEs for employment creation and economic growth. Employment creation should be biased towards the previously disadvantaged. Accordingly, COSATU rejects the co-option of black business as a means of safeguarding their quota allocations.

4. COSATU rejects the introduction of access rights to marine resources to European countries in the SA-EU negotiations even before the restructuring of the industry has taken place in South Africa.

5. COSATU demands an improvement in the working conditions of, particularly, the harvesting workers on the boats.

6. Small-scale traditional and artisanal fisheries should be developed for reasons of equity and sustainability of resource use and to create local employment. Certain proportions of national quotas for given fish species, in particular those relevant to onshore fisheries, should be reserved for small-scale community fisheries.

   Source: FAWU

Food Security

1. COSATU should establish a task-team to develop a food security policy proposal that is in line with the broad principles as contained in the RDP and in line with the vision of "a better life for all". This task team should include the following issues as a basis for inquiry.

   1. To develop a macro-economic strategy that is compatible to, and seeks to achieve the RDP goals. Among others, these would include the enhancement of food security, breaking through the trap of poverty instilled by apartheid, linking growth and human development, and contributing to the development of sustainable livelihoods for the masses. Furthermore, we recognise that food security is a multifaceted goal, which would require related achievements such as the provision of housing and sustainable employment creation.

   2. To call for the government to apply a fiscal strategy to the question of food security, instead of the narrow monetarist approach promoted by GEAR which we reject. This would include applying progressive taxation and allowing for a greater budget deficit. Furthermore, to scrap the apartheid debt in order to increase social expenditure or government spending on social issues like health and education, and projects like feeding schemes and food stamps.

   3. To call on the government to develop a coherent industrial policy, instead of applying ad-hoc measures, geared towards infrastructural and other development projects that will be job creating and consequently help eradicate poverty and enhance food security.

   4. To call for a moratorium on tariff reductions. The government should not reduce tariffs and remove subsidies faster than even the WTO provisions require as this leads to job losses which simply entrenches the poverty cycle. Furthermore, the very role of multilateral institutions (such as the World Bank, the IMF and the WTO) in the South African economy should be critically evaluated.

   5. That COSATU develops a wage policy and national minimum wage that will ensure increased disposable income of those working in order for those to have increased access to goods and other consumer spending and thereby increase domestic demand.

   6. COSATU should call for lowering of the food prices and VAT exemptions on basic food items, for rural development, for the introduction of SMMEs, thereby making food affordable.

   7. To develop infrastructure (including transportation system) in order to make food accessible to those who cannot afford it at present, including the farthest rural areas, in order to make food available and accessible.

   8. That for those state assets earmarked for restructuring, a mechanism must be put in place to ensure mass-based collective social ownership of these assets. This would contribute to poverty eradication and enhancing food security, instead of it resulting in ownership patterns remaining unchanged.

   9. That because it is argued that South African development be accompanied by the simultaneous development of the region (i.e. SADC) and the continent, food security and poverty eradication in SADC should be subject to policy development that seeks to address the discrimination inherent in north-south trade relations.

2. This food security policy proposal shall contain as its other central theme the establishment of a social security net that ensures that no one goes hungry and will revive schemes such as feeding schemes.

3. That the living wage demand and campaign serve as the basis for an approach to food security issues that will ensure that the buying power of disposable/real wage on food products is increased.

4. Legislation should be put in place to ensure that companies are forced to donate perishable and other food items instead of dumping these as part of their strategy to restore the price of these products.

5. COSATU should meaningfully engage the Tripartite Alliance and attempt to secure an Alliance policy position on food security. COSATU should also engage other organs of civil society that broadly belong to the democratic movement.

6. COSATU should embark on a campaign (in line with the World Food Summit in Rome) to mobilise broad social support in forcing the government to take into account policy proposals before the ultimate cabinet approval o food security policy which must address poverty.

   Source: FAWU

Energy Sector

1. Energy sector policy should be consistent with overall industrial and development policy. The development of our energy policy should be transparent and allow for the involvement of all stakeholders. Our energy policy should include the development of the Southern African energy grid as Southern Africa has plenty of natural energy resources which is not being utilised effectively. (NUM). COSATU should engage the White Paper on Energy published by the Department of Minerals and Energy Affairs. In particular, attention should be paid to its vision to restructure the electricity distribution industry, deregulate the liquid fuel industry, and nuclear energy.

2. Restructuring of the Electricity Supply Industry.

   1. The role and structure of Eskom should be tailored to advancing the aim of universal access to affordable electricity both for households and industry, within an overall policy of cross-subsidisation from rich to poor. In order to advance this aim legislation should clearly outline that Eskom is owned and controlled by the state and that in its external and internal programmes Eskom should be accountable to government's broader RDP objectives.

   2. THE Bill that has gone through Parliament has clarified the ownership of Eskom i.e. Eskom being state owned. The Central Committee should endorse this position.

   3. However, a programme of action should be developed to resist the corporatisation of Eskom through:

      • · Incorporation in terms of the Companies Act 1973

        · Eskom being made a tax and dividend paying Company

   4. Our emphasis should be on making Eskom report in terms of Public Entities Reporting Act.

   5. We are opposed to Eskom paying taxes and dividends.

   6. Eskom should be given clear targets and be benchmarked against clear performance targets set.

   7. The whole Electricity Supply Industry should be under a single Governance Structure. This Governance Structure should have a small management team to provide technical back-up.

   8. The Industry should be structured into two public utilities established in terms of Acts of Parliament.

      • Eskom to remain responsible for all Generation and Transmission.

      • A National Distributor should be established consolidating all Electricity Distribution. This national distribution, for efficient distribution of Electricity, can set up subsidiary regional Electricity Distributors and District Electricity Distributors.

   9. The biggest consumers of electricity must pay more per unit and the poor less, with special consumption rates for the unemployed, pensioners, old age homes, public schools, crèches, clinics, hospitals and rural schools.

   10. Services should be extended to rural areas and squatter camps

   11. Masakhane must be intensified to ensure that, amongst other things, there is increased payment for services. People need to be educated about the importance of electricity.)

3. Liquid Fuels Industry

   1. Studies have shown that deregulation leads to job losses, particularly of petrol attendants. This would be particularly serious in the context of high levels of unemployment and jobless growth.

   2. COSATU reaffirms its opposition to the deregulation of the fuel industry, and argues for reregulation in order to give effect to our objectives.

4. Nuclear Energy

   1. Our energy policy should exclude nuclear energy as an energy resource.

   2. More research should be done into alternative energy resources, including environmentally friendly Coal Generation of Power, so that we can improve our competitive advantage in an area that South Africa is a leader already.

   3. All attempts to dump nuclear and chemical waste from industrial countries in Southern Africa should be resisted.

   4. All future dumping of nuclear waste at Vaalputs should be stopped pending a clear strategy to deal with waste management.

   5. In addition, attention should be paid to Nuclear Safety and Nuclear Radiation in Koeberg Power Station, Pelindaba and NUFCOR.

      Source: NUM

Social plan for the mining sector

1. The mining industry employs 552 000 people (with up to 5 million dependents), contributes 8% to the GDP and over 50% to our foreign exchange earnings (including processed minerals). The rate of job loss in this industry must therefore be viewed as a national crisis.

2. While we pursue the further growth and development of our manufacturing and services sectors, that has to occur within the context of the managed downscaling of certain sectors of the mining industry.

3. Such a managed process requires a dedicated statutory downscaling commission with sufficient powers to ensure:

   1. minimal job losses

   2. that unavoidable job losses are cushioned through social rehabilitation or the social plan, which includes counselling and retraining

   3. that healthy mines build up social plan reserves long before they become marginal

   4. targeted state assistance to marginal mines to preserve jobs as long as it is economically and socially feasible

   5. a balance between new technology and labour intensive mining

   6. beneficiation of minerals, to create further demand and new jobs

   7. strong coordination between attempts to stimulate growth in manufacturing on the one hand, and the need to find alternative employment for appropriately retrained and re-skilled ex-mineworkers in mining towns and rural areas

      Source: NUM

Technology

1. Technology and technological innovation that does not displace labour or inhibit job creation requires technology policy that is informed by the following objectives :

   • building complimentary links with southern Africa and other developing countries;

   • a participatory process of policy formulation and innovation;

   • defining a developmental role for the state regarding "new frontier" technologies;

   • ensuring that technology is used to skill and empower workers.

2. To ensure job creation and maintenance unions have to engage with technology at the level of policy development. This includes :

   • Worker and community participation in the National System of Innovation, envisaged in the White paper on Science and Technology, through participation and links with universities, local research and development (R&D) centres, NGOs and the factory floor.

   • The role of the state has to include facilitation of worker involvement in science and technology development, and also direct intervention to develop certain sectors like micro-electronics, and increased finance for R&D. Procurement policy should be used to influence innovation in labour intensive technology.

   • Optimal utilisation and development of technology has to happen through increased numeracy and literacy skills, as part of an integrated education and training policy thrust that links scientific, mathematical and computer skills education.

   • Employers must be required to negotiate with the union at least six months in advance of the introduction of any new technology. In particular, employers must be required to negotiate with the union regarding any changes in numbers and the location of jobs, as well as any forms of work reorganisation

   • Government must develop policies to ensure that South Africa South Africa becomes a developer of new technologies rather than merely a consumer of technologies developed elsewhere. This is particularly important to ensure that new technologies provide for social needs delivery and that they are appropriate to our context as an African developing country.

   • Government must ensure that international agreements, particularly those concerning intellectual property rights, are negotiated to ensure equity for developing countries like South Africa, rather than merely to serve the interests of globalisation.

   • Affirmative action policies must explicitly include measures to ensure the redress of historic imbalances of access to and usage of new technologies which are based on race, gender, disability or class.

   • Employers must be required to ensure that new technologies are combined with appropriate human resource policies and the training of workers so that skills are upgraded.

   • Government’s information and communications technology industrial strategy must ensure that such technologies are developed to provide for social needs delivery and to create jobs.

   • Employers must be required to provide the union with access rights to their information and communications technology networks and infrastructure to facilitate communication with shopstewards and membership.

   • Technological agreements must include the transfer of skills.

     Source: Labour proposals on Jobs Summit, COSATU IT Unit, NUMSA.

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LABOUR MARKET POLICY

Vision

We believe that Labour Market Policy should:

1. Redress the legacy of labour market segmentation and discrimination based on class, gender, race and age, with the aim of improved quality and security of present jobs, and equal access to new jobs.

2. Facilitate workplace democracy through enhanced worker control over decision-making.

3. Close the apartheid wage gap between the top and the bottom in the workplace.

4. Train and develop the workforce.

5. Through NEDLAC guide the impact of Public Works Programmes to ensure training in communities and job creation.

6. Create decent and sustainable jobs for all at a living wage and train workers to be more productive.

7. To reverse the current exploitation in employing workers on a casual, temporary or fixed term contract basis.

Our main arguments in support of our vision

The legacy of apartheid

The legacy of the apartheid era has produced a set of labour market institutions which have fundamental weaknesses. The two most severe problems are:

• The inability to create conditions of full-employment;

• The large number of jobs which fail to pay a living wage.

South African Labour Market is Flexible already

1. The supposed need for greater labour market flexibility is based on a presumption that the labour market actually suffers from inflexibilities with respect to wages and employment.

2. In fact, the labour market, as it currently exists, is remarkably flexible in terms of wages and employment as demonstrated by the International Labour Organisation (ILO) study of the South African labour market. The amount of institutional protection workers have in South Africa is very small; retrenchments are not difficult; there is an increasing trend towards casual and atypical employment; and most wages are determined at plant or enterprise level.

Address poverty and food security - pay a living wage

1. It is evident from the available data that both low wages and unemployment contribute to poverty in South Africa. The poor in South Africa consist of both the unemployed poor and the working poor.

2. Policies aimed at reforming the labour market and creating new job opportunities must take this dual source of poverty into account. Jobs must be created and economic opportunities expanded. Wage flexibility as a means of poverty alleviation – and particularly if new jobs are seen as the central mechanism of redistribution – simply means exchanging one source of poverty (low wages) for another (unemployment).

3. Creating new employment opportunities along with higher wages requires a long-run strategy and depends on the successful accumulation of productive investment in sectors of the economy which produce jobs, and on the structural transformation of the apartheid-era labour market.

Labour Productivity is on the rise

1. We are confronted with arguments everyday - in workplaces and in the media - that workers’ productivity needs to increase in order for our industries to become competitive. In fact, labour productivity has been rising and unit labour costs have been declining since 1992.

2. Strong union presence, worker rights and labour standards compel management to seek productivity improvement through increasing management effectiveness, innovation, increased investment in training and skills and worker participation.

3. Our view is supported by the ILO’s argument for the importance of ‘’dynamic efficiency’’. For example, where there are few costs or limitations on management use of overtime, there is little incentive for managers to engage in serious forward planning and production scheduling, or to make efficient use of available people. We reject strategies for improving competitiveness through undermining worker rights and labour standards, fragmenting the labour market or reducing wages.

4. Workers and trade unions cannot be held to be the chief obstacles to productivity improvement. It is management, government (through the supply of services, infrastructure and industrial policy), and low capacity utilisation which are responsible for most productivity problems which exist. We believe that increasing the competitiveness of the South African economy requires a strategic approach to entering rapidly changing world markets; public investment in cheap and efficient infrastructure, communities, people and skills; and a comprehensive restructuring of the management structure and how production is organised.

5. At a broader level, a different approach to promoting productivity as part of a broader strategy of redistribution and employment creation is clearly required. Labour has proposed (in ‘Social Equity’) the need to negotiate a National Productivity Framework in order to achieve this objective.

Wage policy and apartheid wage gap

1. A defining characteristic of incomes in South Africa is the wage gap between blue collar and low-paid workers on the one hand; and management and high-paid employees on the other. The gap between the salaries of management and other highly-paid staff, and the wages of the bulk of union members, is extremely high by world standards. This is the legacy of the apartheid wage structure.

2. Labour costs include the total wage bill, including the remuneration of management. Managerial, professional, supervisory and skilled positions account for some 45% of the wage bill, although they constitute only 23% of the total workforce in manufacturing.

3. Supporting evidence for the high cost of management in South Africa is provided by the 1996 World Competitiveness Report. South Africa is ranked 41 out of 49 countries in terms of management efficiency, but 6th in terms of the remuneration of top management. The high cost of South African managers is very clear when it is contrasted with the low productivity of the enterprises they manage.

4. A significant reduction of the management wage bill would contribute substantially to the reduction of labour costs. However, the management/worker ratio is increasing. Management functions should be devolved to the shopfloor, and a portion of management salaries that are saved should be redistributed to shopfloor workers.

5. There is no evidence that wage increases won by union members are the main source of inflation. To the extent that rising incomes generate inflationary pressure, this can as plausibly be explained by high and rising management incomes. Redistributing part of these incomes to workers will tend to increase demand for local goods and reduce poverty.

6. The above arguments makes it clear we see no reason for unions to moderate their wage demands or accept higher levels of wage flexibility. Indeed, union demands should stimulate management to seek ways to reduce the cost of management and improve production processes.

7. . Union wage policies should be based on the following:

   1. Increases in basic wages should not be linked to productivity increases since the major portion of productivity improvements are the responsibility of management. At the same time, as producers and stakeholders, workers should share the benefits of productivity improvement, either through wage increases or through gain-sharing agreements. The trade union movement should pursue a strategy of wage solidarity which seeks to increase most the wages of the lowest paid. Unions should oppose "labour market flexibility" which seeks to increase wage flexibility (e.g. undermining centralised bargaining, increasing Casualisation). Centralised bargaining should be strengthened.

   2. We reject business' proposals on Labour Market Policy and those aspects of governments proposals which advance:

      • The lowering of labour standards

      • Job losses

      • Flexibility

      • Wage moderation

Source: September Commission and NUMSA

Policy Proposals

Implement Basic Conditions Act

1. Call for the urgent implementation of the Basic Conditions of Employment Act, in order for the first time to extend basic protections to all South Africa's workers. The implementation of the legislation is an important aspect of the transformation of the inherited apartheid labour market. The Act should not permit downward variation of standards.

2. Note aspect of Ntsika report on small business that states that there is no special dispensation for small business in other countries. Also based on this report push for an effective programme promoting full compliance to the basic conditions and other legislation by all employers including so called emerging businesses.

3. Approach Alliance structures to agree on an approach to further pro-labour amendments which could be made to the Basic Conditions of Employment Act, as per the earlier agreement. In particular, the implementation of mechanisms for paid maternity leave and improved regulation of variations.

4. The Basic Conditions of Employment Act has many provisions that will affect women workers negatively such as:

   1. Downward Variation which will allow companies to attack maternity and child care rights.

   2. Responsibility leave is only three days and includes compassionate leave and excludes casuals.

   3. It provides for sick leave to be reduced to 75% in exchange for an unpaid day off.

   4. Companies will use these provisions by reducing sick leave and maternity leave.

      COSATU must reject the variation model of the BCEA and campaign for all rights to be extended to casual and temporary workers.

   Source: CWIU

Employment Equity Bill: Closing the Apartheid Wage Gap

1. COSATU should launch a campaign to close the apartheid wage gap to a ratio of at least 1:8 over an agreed period. This should include a framework which sets targets for wage equity in the private and public sectors.

2. The Employment Equity Act should be broadened to include mechanisms for monitoring of the closing of the wage gap in each company, and between all levels of the workforce including top management.

3. The top 58 companies should publicly agree to release information on the pay of their individual executive directors, particularly their CEO’s. This should include salary or director’s fees, pension, bonus, perquisites and share options. Information on the minimum wage payable to workers in their companies should also be made available. In addition the publication of this information should be a reporting requirement for all listed companies on the JSE.

4. Further, the top 58 companies should commit themselves to reducing the wage gap (including all fringe benefits and options) in the companies to no more than 1:8. This means that the earnings of the highest paid person should not be more than eight times that of the lowest paid person. Even such a wage gap will be unacceptably high but would constitute an important first step in our country towards a shared future.

   Source: COSATU Policy Conference May 1997, Social Equity

Outsourcing

1. Outsourcing should not downgrade conditions of employment of workers in the same industry.

2. The employers should be compelled to consult with registered unions either prior to the decision being made, to initiate any feasibility study of the area being considered for outsourcing or alternatively give at least six months notice prior to outsourcing. - whichever of the above affords the longer notice period.

3. There should be full disclosure of information.

4. The state should set an example and abide by agreements on outsourcing to ensure maintenance of agreed upon labour standards.

5. Where outsourcing has taken place, outsourced companies should be covered by same collective bargaining agreement as in the core operations

   Source: NUMSA

Labour Brokers and Independent Contractors

1. Labour brokering and independent contracting should be regulated, and workers in these sectors should enjoy the full rights and benefits of full-time workers.

2. Separate national registers of labour brokers and the temporary workers they employ must be established.

3. Compliance with existing regulations must be monitored with the assistance of the national registers, including ensuring companies only use such registered labour brokers.

4. Unregistered labour brokers should be prosecuted and heavy fines imposed on them.

5. That in the long-term, labour brokers be banned as they do not create jobs but make profit from the extreme exploitation of workers by individuals representing their own interests instead of the goals of socio-economic transformation.

   Source: NUMSA

Wages

1. COSATU should campaign for minimum wage settings for the vulnerable and less organised sectors of the economy using bargained wage levels as yardsticks. This should also take into account the existing inequities, disparities in incomes and the struggle for a living wage.

2. The minimum wage is defined as "a regulated monetary wage at national / sectoral level taking into account the cost of living which must be regularly reviewed". It could include or take the form of a social wage incorporating health care, transport, pensions, etc.

3. Wages should be separated from productivity incentives.

4. Blanket exemptions should not be permitted where exemptions apply they must be based on the merits of individual companies. Criteria on exemptions should be developed at the national industry level and be implemented at the sectoral level.

5. COSATU should revive the Campaigns Committee and focus on, among others, the strengthening of centralised bargaining, highlighting the Living Wage campaign, and ensure that affiliates develop common demands.

6. Government must set up and abide by minimum wage agreements arrived at during collective bargaining.

7. Government must monitor and prosecute those who disregard the agreed minimum wages.

8. COSATU should work towards an increase in the employment of women in all areas of work and especially in higher paid job categories. This requires a conscious attempt to integrate gender aspects in COSATU affiliate wage policies by linking the demand of equal wages for equal work and equal wages for work of equal value to the living wage campaign. This will ensure that affiliates take up the struggle against the oppression and exploitation of women, ensuring that this is not regarded as a "women's" issue but a problem of every member of the union.

9. The minimum living wage must be determined at national industry level.

   Source: Living Wage Conference 1996, NUMSA, Policy Conference May 1997

Training and Skills Development: Implementing the New Education and Training System

Implementing the National Qualifications Framework (NQF)

For qualifications to achieve the transformative objectives of the NQF, COSATU unions must ensure a commitment from government and employers to:

• Agree to the speedy and effective implementation of the Skills Development Bill

• Provision of paid education and training leave (PETL)

• Learner guidance, counselling and support

• Development of quality education, training and development practitioners (ETDP)

• Quality assessment, including recognition for prior learning (RPL)

• Large scale delivery of education and training

To this end we must ensure the following:

1. Access

   1. All workers should have access to education and training, including Adult Basic Education and Training (ABET), further and higher education and training.

   2. We re-emphasise our call for South Africa to endorse the ILO Convention 140 which entitles all workers to paid education and training leave.

   3. Employers pay for this education and training:

      • The levy in terms of the Skills Development Bill is one mechanism.

      • We must ensure that the levy is reviewed annually to incrementally achieve at least a 4% levy

      • Other funding mechanisms to be agreed between unions and employers

   4. The way learning programmes are designed, e.g. modular -based, with flexible and multiple entry and exit points, must facilitate access.

   5. We reject the approach taken by some employers to achieve higher levels of education through retrenching workers without ABE and will use all avenues to stop this.

   6. Childcare facilities and grants/financial support for the duration of learning must be provided.

2. Recognition of workers skills and knowledge

   1. Education and training should relate to learning and career paths for workers

   2. Workers should get recognition for the skills and knowledge they have acquired (through formal and non-formal learning, trade union experience, etc) through recognition for prior learning.

   3. The methods of assessment (such as interviews, demonstrations, portfolios) used for RPL and other education and training should be fair, transparent, in the language of the workers choice and be negotiated between unions and management. RPL must be treated as a process and not an event.

   4. The RPL process must be jointly administered by management and unions. Both parties must be trained as assessors, including for RPL purposes.

   5. Workers must have the right to have access to opportunities to be assessed for RPL. This access must be voluntary for workers, and no worker can be down graded as a result of RPL.

   6. Work must be re-organised to ensure that skills and knowledge acquired are used in the workplace, however, even when skills are not applied, workers must be paid for skills acquired.

   7. Workers skills and knowledge should also be recognised through the grading system.

   8. The grading system should include skills as a factor, but not be limited to skills.

3. Organisational capacity and co-ordination

   1. Continued effectiveness and influential participation in the transformation of education and training at all levels - national, provincial, industry/sector, company/workplace - by COSATU is crucial.

   2. COSATU must play a more active role in facilitating the sharing of experiences of affiliates; development of implementation guidelines and ensuring a co-ordinated approach to transformation of education and training at all levels.

   3. Efforts to ensure more effective engagement on these issues by unions at all levels, including capacity building must be intensified.

   4. While COSATU and some affiliates have made progress in negotiating a framework for education and training, grading and wages, this lacks a gender perspective. COSATU must more seriously address a gender perspective on these issues or women will find themselves at the bottom of the heap. . COSATU and affiliates should critically assess these agreements and monitor their implementation to ensure delivery.

   5. The above items should be taken up in all bargaining forums.

   6. The employer in the public sector should consult with labour unions in the public sector around worker education and development programmes and budgets.

   Source: NUMSA, NUM, Social Equity, Secretariat Report 1997 Congress, CWIU

Scab Labour

1. COSATU should campaign for the prohibition of scab labour in legislation.

2. Call on the government to put an end to the use of scab labour through:

   1. Requiring companies which tender for government contracts to sign an anti-scab code.

   2. Requiring companies receiving any government incentives, such as export and regional economic development incentives, to sign an anti-scab clause.

   3. Agreeing not to use scab labour in areas of the public sector and parastatals, where workers are striking legally.

3. Campaign in all industries for an end to scab labour by putting a demand to employers in all bargaining forums.

4. Essential and Maintenance services should be broadly defined so as to minimise the use of scab labour.

5. Link any discussion on productivity at plant level with a demand for an end to scab labour.

   Source: SACTWU, Living Wage Conference 1996

Demands to improve minimum LRA provisions and Proposed Amendments

1. Affiliates must fight for provisions that are better than minimum provisions which are reflected in the LRA; and in that regard ensure that they include demands on the following provisions:

   1. The duty to bargain;

   2. The right to strike over individual dismissals;

   3. The right to strike;

   4. Exclude the right to lock-out;

   5. An improved severance package – of no less than four (4) weeks per year of service – for retrenched workers;

   6. When challenging the unfairness of retrenchment, affiliates must demand compensation for the loss of future earnings and personal belongings.

2. COSATU must embark on a campaign, through collective bargaining, to fight for the above issues to be agreed by employers in the different industries.

3. The Central Committee mandates the EXCO to initiate comprehensive discussion on the closed shop and study its implications at all levels.

4. In order to address the problem of free-riders, affiliates should trigger the agency shop as stipulated in the new LRA where unions are in majority.

5. COSATU must pursue the fight for the duty to bargain as an amendment to the LRA.

6. Section 197 of the LRA should be amended to ensure that the transfer of employment or retention of conditions of employment be made obligatory on both the old and new employers.

7. The protections for workers against retrenchment should be strengthened through amendments in the LRA. These amendments should:

   • Require the clause on dismissals for operational requirements to apply only when a company has no alternative , rather than for any 'objective reason' Therefore retrenchments to simply increase the rate of profit of a company or to lower costs to increase market share, is not acceptable. The grounds for retrenchments should be defined as narrowly as possible. The current LRA is deficient in this area. This should allow unions to challenge the reasons for retrenchment, not only the procedure, or

   • Permit collective bargaining agreements to address issues of retrenchments (reasons and procedure) as mattes of interest, hence permitting the right to strike on retrenchment.

   Hence, a union will be able to elect whether to deal with retrenchment issues as a matter of right or as a matter of interest.

8. The clause of the LRA dealing with contracts of workers whose companies are sold, should be amended to give workers the right to severance pay even when their companies are sold, since the current wording is open to abuse by unscrupulous employers.

   Source: CWIU

CCMA

1. We should encourage people sympathetic to labour to staff the CCMA, but at the same time we must not cripple the labour movement.

2. CCMA Commissioners must not include company industrial consultants – whether presently practising or not.

3. COSATU should campaign to improve the service which the CCMA renders to users.

4. No lawyers to act at CCMA conciliation or arbitration.

5. We must ensure that the salaries of top management of CCMA should not be of a 'gravy train' size.

6. Ensure that the appointment and reappointment of Commissioners should continue to be based on our consultations with affiliates and regions concerned.

7. Unions should use the statutory system of industrial dispute resolution.. COSATU fought for a statutory system and must strengthen and improve it. Collective agreements should be reviewed to further the above.

Essential & Maintenance Services

1. The committee that will deal with the essential services must have a working class bias.

Exemptions

1. A definition of small, medium and micro enterprises needs to be developed at national level as a framework to guide sectoral debates. Such definition should take into account issues such as turn-over, numbers of people employed, etc.

Extension of Agreements to non-parties

1. COSATU reaffirms that it will reject completely, and resist any effort to change the provisions of the LRA which automatically extend agreements to non-parties.

Recognition Agreements

1. All existing recognition agreements must be reviewed in line with the minimum conditions as specified in the new LRA.

2. COSATU should assist in this process.

Amendments to the Labour Relations Act of 1995

1. The Act needs to make the same provisions, which prohibits an attorney from presenting parties at CCMA arbitration where the issue in dispute is dismissals for misconduct, directly applicable to Bargaining Councils.

   Motivation: Currently the Act permits Bargaining Councils the right to determine who may represent parties in these arbitration, and formulate their own procedure in their Constitution and dispute procedures.

2. The CCMA must be a tri