South Africa: 20 years after Mandela's release, class apartheid continues

SOUTH AFRICAN STUDENTS CONGRESS

18 February 2010 

BUDGET SPEECH – OLD WINE PACKED IN NEW GORDHAN BOTTLE 

Stripped of the pomp and demagogy so reminiscent of the former Minister of Finance, Pravin Gordhan has not deviated one bit from Manuel’s unpopular fiscal austerity and inflation targeting antics. Despite all the rhetoric about the need to focus on the jobless and poor, the budget speech signals another year of prosperity and unabated accumulation for the capitalist class while the poor will once more watch the gravy train pass by. 

We are appalled that government has not detailed any financial plans to resuscitate collapsing parastatals, or any political solutions to their financial crisis such as moratorium on golden handshakes for failed executives. If government seeks to avoid the unpalatable disaster that will engulf our parastatals it has got to take decisive action. The financial chaos in Eskom, Telkom and SABC is as much a fault of the executives as it is of the government that allows these parastatals to run in the same way as private companies do. We know that Eskom will attempt to resolve its cashflow problems by deferring costs to the consumers particularly the working class and we are totally opposed to this because it will inevitably force institutions of higher learning to increase fees.  

It is difficult to understand the lack of increase in company tax while the Finance Minister himself acknowledges a fall in revenue. It cannot be that tax relief is extended even to the wealthy bourgeoisie in the same way as it is done for the working class and the poor. This illusion that tax relief for capital will result in job creation will once more be proven as wishful thinking. 

We are concerned by Minister Gordhan’s hint that suggests that the Reserve Bank should remain independent, quoting the constitution. The government continues to act as though it is oblivious of the fact that the Reserve Bank is one of the few that remain outside total government control far surpassing even the most avowed liberal and capitalist states. 

Certain aspects of the budget remain totally laudable and impressive though. The decision for stern action against tax evasion particularly by companies is welcome. We also welcome the increase of sin tax. We welcome the increase of grants, however we believe given the increased inflation of the past few years necessitated a much more substantive increase on grants. This re-enforces our call for a Basic Income Grant. We also welcome increased spending on education but we believe it remains miniscule and cannot resolve the deep structural problems of the sector. 

We believe that the budget speech was a missed opportunity to reign on companies that profit from South Africa but play no role in job creation or in decreasing the gap between the rich and the poor. The Minister missed the opportunity to once and for all accept the toothlessness of the capitalist market and direct us towards rigorous government participation in the economy. The Minister missed an opportunity to decrease economic stratification by increasing taxation on the rich. 

Instead of developing a new path, Pravin Gordhan’s budget speech is nothing but old wine packed in a new bottle. The excitement over the neo-liberal in outlook of the budget speech by DA, COPE and other opposition parties, exposes this. 

For details Contact

Mbulelo Mandlana (President)

076 934 9863

Or

Lazola Ndamase (Secretary General)

082 679 8718

 

Business Day: General strike threat as unions round on minister

WILSON JOHWA BD PUBLISHED: 2010/02/19 07:13:22 AM

WITH a day to marshal their forces after Wednesday's budget, union leaders yesterday launched a furious assault on Finance Minister Pravin Gordhan and the government for "talking left and walking right".

They were also firming plans for a general strike in October as a row mushroomed over Gordhan's decision to hold the Reserve Bank's target inflation band at 3%-6%.

As President Jacob Zuma 's brittle coalition begins to unravel, union leaders all but accused Gordhan of deceiving them, saying that the ruling alliance's summit meeting in November had agreed to create a task team to study broadening the Reserve Bank's mandate.

Congress of South African Trade Unions (Cosatu) general secretary Zwelinzima Vavi said yesterday the task team had not even met.

"The mood (at the summit) was that the inflation targeting policy had to be reviewed; the band had to be reviewed," Vavi said.

"We have to keep an interest rate regime that is low. We've got to have a competitive exchange rate. We've got to consider speed bumps so that we don't lose out in terms of investment moving out of the country," he said.

These questions sho uld have been referred to the task team.

Vavi accused the Zuma administration of ignoring Cosatu's concerns on economic policy.

"In the meantime, government processes are not waiting for us. The minister

(Gordhan) is galloping (ahead) as we now know. Then the question is, where is the political centre, why is it not holding in relation to that matter?

Must we now wait for the minister to change his mind until next year? We will not."

Cosatu could no longer afford to "place all the eggs in the basket of engagement", Vavi said. It would "fight practically", with a general strike in October in protest against labour broking and unemployment.

Cosatu, which last week supported Zuma for a second term as state and African National Congress (ANC) president, was angered by Zuma's failure to even mention the issue of labour broking in his state of the nation speech.

Cosatu's second-largest affiliate, the National Union of Metalworkers of SA (Numsa), yesterday criticised Zuma's state of the nation address and the budget. It criticised Zuma for not defending ANC secretary-general Gwede Mantashe against attacks by the ANC Youth League.

Numsa general secretary Irvin Jim accused Gordhan of appropriating the language of the left, and talking of transforming the economy while retaining the status quo.

"We continue to witness an empty state of the nation address and the minister of finance talking left but acting right," Jim said at a media briefing after a two-day meeting of the Numsa executive.

The state of the nation address had failed "to give a clear vision and command to all state institutions and to galvanise the masses of our people behind the programme of action as laid out at Polokwane", he said.

The budget was "antiworking class and antipoor". It had nothing do with doing things differently. Jim questioned the government's definition of "job opportunities", asking why enough money was not put into road agencies to create significant jobs in road construction and maintenance.

"Decent work is not hamburger jobs," he said.

Jim also laid into Reserve Bank governor Gill Marcus, saying it appeared that "the new governor has not grasped the damage caused by a strong exchange rate, which makes our economy suck in excessive imports, a problem also exacerbated by trade liberalisation measures of the past".

Numsa, the most vocal of Cosatu affiliates on the Reserve Rank mandate, said the Bank was still pursuing conservative policies of high real interest rates, despite demands for a 2% interest-rate decline to stimulate growth and reduce the rand's overvaluation.

Jim also said there was an anticommunist campaign in the ANC targeting Mantashe.

He asked why Zuma, as party president, was quiet, despite attacks on Mantashe, a member of the executive. "We are not married to Gwede. We elected the top six," he said.

Jim said the ANC Youth League, which was leading the campaign against Mantashe, was fronting unknown individuals, who had risen in the realignment of forces after the ANC's Polokwane conference.

"There is a force behind the youth league."

johwaw@bdfm.co.za

 

Bloomberg: Cosatu’s Vavi Says ‘Gloves Are Off’ Over ANC Alliance (Update1)

February 19, 2010, 08:22 AM EST

http://www.businessweek.com/news/2010-02-19/cosatu-s-vavi-says-gloves-are-off-over-anc-alliance-update1-.html

By Franz Wild and Mike Cohen

Feb. 19 (Bloomberg) --Zwelinzima Vavi, leader of South Africa’s biggest labor federation, said the government’s failure to overhaul policies that have left one in four workers without jobs is straining the country’s ruling alliance.

“The gloves are off,” Vavi, secretary-general of the Congress of South African Trade Unions, said today in an interview with Johannesburg-based E-TV. “There’s no more honeymoon.”

On Feb. 17, Vavi told reporters he was “extremely disappointed” after Finance Minister Pravin Gordhan maintained spending limits and inflation controls when he presented the national budget. The central bank will continue to target inflation of 3 percent to 6 percent, Gordhan said.

Cosatu portrays Gordhan’s budget, his first, as a continuation of policies that accompanied the longest period of growth in Africa’s largest economy, when unemployment reached 24 percent. Cosatu and the South African Communist Party have supported the African National Congress in a ruling alliance since the ANC took power 1994, after the country’s first all- race elections.

In 2007, Cosatu’s influence in the ANC was instrumental in ensuring Jacob Zuma, now South Africa’s president, replaced the party leader at the time, Thabo Mbeki, whose fiscal conservatism the labor organization deemed bad for employment.

“The alliance is in trouble, but is not at the point where it will fall apart,” Dirk Kotze, a politics professor at the University of South Africa, said by telephone from Pretoria. He said Cosatu needs the alliance more than the ANC does. “There are many people in the ANC who express that quite bluntly,” he said, while the ANC can still have an electoral majority” without having to rely on the unions.

‘War’ on Workers

The National Union of Metalworkers of South Africa said Gordhan had “been overly influenced by the neo-liberal priests, who can’t see beyond outdated neo-liberal stereotypes.” The budget “constitutes a declaration of war to workers and the poor, as its intention is to undermine the gains that we have secured under the dark days of apartheid,” the union said in a statement on its Web site yesterday. Apartheid refers to the policies which segregated the races under white-minority rule.

Cosatu spokesman Patrick Craven said the federation won’t seek to replace Zuma or leave the alliance with the ANC and the South African Communist Party. Craven spoke on the telephone from Johannesburg.

Gordhan rejected criticism from the unions. “We want to humbly and respectfully disagree,” he said in a Feb. 17 interview. “This budget begins to signal that we are on a different growth path. We are attempting to do things differently.”

--Editors: Heather Langan, Alan Crawford 

NUMSA NEC Statement – 18 February 2010 on

political–socio-economic challenges confronting the country:

The Numsa National Executive Committee meeting held a serious debate and discussion on the political developments that have taken place within our own liberation alliance led by the African National Congress. We considered problems that have engulfed the alliance as a result of some individuals within the ANC who are resolute to champion an anti-communist stance against other ANC members. The NEC concluded that such individuals have taken an anti-Cosatu and anti-SACP posture.

The National Union of Metalworkers of South Africa takes the view that this anti-communist stance has in fact singled out Secretary General of the ANC Gwede Mantashe, on the basis that he is a communist. This anti-SACP and anti-Cosatu posture is unprovoked, and it is deliberately generated by an alignment of individuals who disapprove of the good working relations within the alliance that emerged after Polokwane. Our union takes the view that this red pen game is the old tendency that has forever haunted the national liberation movement and it has always been defeated. Numsa takes the view that this tendency is ideologically not different to what we have dealt with in the past 15 years and which, defined as the 1996 class project.

Numsa in its analysis takes the view that this red pen game that has singled out the Secretary General of the ANC is nothing else but a class war against the interests of the working class, which constitutes the primary and decisive motive force in the African National Congress.

The offensive by this anti-working class tendency can only be about desperate backward capitalist accumulation for these individuals and the capitalist class seeking to use both the ANC and the state for private accumulation of wealth. These forces are threatened by the class nature of Cosatu and South African Communist Party and their growing hegemony over the South African political and ideological landscape.

Numsa rejects the premature call to unseat the Secretary General of the ANC now and in 2012. This is now an open and now hidden reactionary capitalist class agenda and it is not in the interests of our liberation movement, the African National Congress; it is anti working class which is a key constituency of the movement. The Numsa NEC is very certain that we shall defeat this reactionary challenge as we have defeated the 1996 class project.

We think this call to remove the ANC Secretary General constitutes a rude awakening and point to the importance of the call by Cosatu to defeat corruption championed by gangs inside and outside our movement for tenders and concessions. Numsa regards the campaign against Cosatu and the Sacp as informed by the capitalist greed of individuals who want to take control of the movement and the state to use it as their accumulation strategy. These individuals clearly regard the Secretary General as not amenable to such an accumulation strategy.

Numsa, in the light of these challenges, resolved to call on its members and Cosatu to intensify the swelling of the ranks of the African National Congress so that the interests of the poor and the working class are secured, now and beyond 2012.

The national union notes liberalism championed by individuals who are championing this fragmentation and division within our own movement the African national congress for persona greed when it suit them they speak left and claim to be Marxist, their sympathizers include some within our movement, those who were part of forming Cope but didn’t leave, those are in Cope who are celebrating this opportunistic call to deal with the leadership elected at Polokwane

Mao Tsetung defined their liberalism their character trait, their mannerism and said “People who are liberals look upon the principles of Marxism as abstract dogma. They approve of Marxism, but are not prepared to practise it or to practise it in full; they are not prepared to replace their liberalism by Marxism. These people have their Marxism, but they have their liberalism as well - they talk Marxism but practise liberalism; they apply Marxism to others but liberalism to themselves. They keep both kinds of goods in stock and find a use for each”

State of the Nation

On the state of the nation address by President of the African National Congress and the republic of South Africa comrade Jacob Zuma:

The National Union of Metalworkers of South Africa welcomes the state of the nation address, but we remain extremely concerned about some fundamental issues which in our view have been left out, especially in the light of the major structural problems faced by our economy. The address failed to respond to the glaring serious and worsening socio-economic conditions confronting working class communities. It also failed to give a clear vision and command to all state institutions and to galvanize the masses of our people behind the programme of action as laid out in Polokwane.

On the economy we noted the following:

·        The economy has lost 900 000 jobs.

·        The Reserve Bank is still pursuing its conservative policies of high real interest rates – we repeat our demand for a 2% interest rate decline to stimulate growth and reduce the rand’s overvaluation - and it appears that the new governor has not grasped the damage caused by a strong exchange rate, which makes our economy suck in excessive imports, a problem also exacerbated by trade liberalization measures of the past

·        The insufficiently expansive fiscal stance adopted by the National Treasury in view of the continuing weak performance of the economy, and the continued relaxation of exchange controls, which will worsen the country’s persistent balance of payments deficit

·        The lack of pronouncements on need to regulate short-term capital flows

·        There is an increase in casual labour and various forms of precarious work

·        The economy continues to wallow in deepening income inequalities, with South Africa now conclusively overtaking Brazil as the world’s most unequal large economy

·        There is little progress by government departments and state owned enterprises to set and adhere to local procurement targets

·        There appears a lack of commitment to promote decent work through procurement practices that could champion localization, and a failure to act against labour brokers

·        There is no relief from the continued domination of our economy by monopolies, their immoral tendencies of price fixing, thereby worsening poverty for the majority of our people.

·        There is still a lack of implementation on what has already been agreed at Nedlac in response to the crisis, particularly the roll-out strategy for infrastructure.

Numsa is therefore disappointed that these critical issues failed to see the light of day in the State of the Nation address. Numsa had hoped that the President would:

·        Lay out a re-conceptualized public works programme that guarantees quality and sustainable jobs to all those who are willing and able to work, as a key lever in the promotion of decent work and denting poverty and unemployment.

·        Flag key sectors in which the state will play a decisive particularly highlighting opportunities for a state-led agricultural development programme that is aimed at upgrading and installing rural productive infrastructure, a national pest control programme, revitalization of water reservoirs, and irrigation schemes in order to revitalize the agricultural sector. Such projects offer sustainable jobs given the continued need for maintenance and management of productive infrastructure.

·        Provide direction and report on work already underway regarding the review of the mandate of the Reserve Bank in dealing with monetary policy, how it relates to fiscal policy and in what way monetary policy puts the creation of decent work as a primary focus, in line with the Election Manifesto. The omission by the President to address this issue under-estimates the extent to which monetary policy constrains the economy from taking advantage of the economic recovery, and it leaves South Africa out of step with the rest of the world in relation to Reserve Bank ownership and the mandate enjoyed by other central banks to improve overall economic performance – not simply maintain an overvalued interest rate and target inflation.

·        Highlight the need for management of volatile capital flows to protect South Africa from dangerous international financial market machinations which have already led to five major crashes of the rand since 1996, and the institution of exchange controls to lower the adverse impact of exchange rate volatility on investment and employment.

·        Pronounce on the fact that government’s commitment to decent work is the direct opposite of the business of labour brokers, and that labour brokers should be banned.

·        Indicate a comprehensive review of procurement procedures, and give practical effect to the commitment to localization, decent work and the promotion of sustainable livelihoods.

·        Respond to service delivery protests by reporting on the concrete progress that has been made to address the underlying problems faced by working class communities on service delivery, which are a product of the distorted structure of the South African economy, the lack of appropriate subsidies for services such as electricity and water, and commercialisation policies in municipalities that lead to services disconnections.

·        Provide policy direction on tackling negative consequences that stem from the private character of monopoly industries, particularly petro-chemicals, steel and some food processing companies who sabotage government’s efforts to fight poverty and increase competitiveness, by engaging in import-parity pricing and collusion, thereby undermining the prospects of developing a vibrant manufacturing value chain.

·        Pronounce on a creative way to roll-out the infrastructure programme, as part of the response to the crisis.

·        Flag issues such as the revitalization of the road and rail network as a critical intervention to create decent work and to promote the long-term competitive potential of the economy. This could be done through the capacitation of the National Road Agency to directly employ road workers and engineers for construction of roads, maintenance, and expansion of infrastructure to revitalize collapsed rural towns that have been victims of the nodal approach on development and connect them to the mainstream of the economy in order to promote balanced development and to eliminate economic exclusion.

·        We have made the point in the past, and we will continue making it, that as a liberation movement, our revolution is about liberating Black people in general, Africans in particular. This can only be done if we truly live up to the movement’s resolve in Morogoro in 1969, that unless the basic wealth of this country is restored to the people as a whole, the narrow emphasis on service delivery sets up the ANC-led Alliance for failure. No amount of service delivery will address the gap between the growing needs of the masses and the current lagging financial capacity of the state, unless the basic wealth is restored to the people as a whole. This issue should constitute a thread that defines all State of the Nation addresses.

On Energy we noted the following:

a) The pronouncement on independent power producers

b) The establishment of an independent system operator

Numsa noted the above pronouncements and unfortunately, it leaves us with the impression that privatization is being introduced through other means than the outright sale of Eskom. We note that this is taking place against the backdrop of the crisis in Eskom and the hike in electricity prices. The Numsa position will be to reject any form of privatization of the energy sector.

Our proposal instead must be to assemble a team of experts to investigate:

· the cost-drivers that make the Eskom not viable

· the forces behind the huge tariff hikes demanded by Eskom

· the procurement practices and the role of consultants in driving Eskom’s costs

· the technical capacity of Eskom to manage mega-projects

· the capacity of Eskom management to pull together a turnaround strategy for such a national asset

· the extent to which the pricing of electricity promotes priority sectors

· rejection of the $4 billion World Bank loan, with all that it implies for privatization and higher consumer tariffs hitting the poor hardest, and instead source local savings where grid expansion is required

In the absence of such a comprehensive investigation, it is premature for government to suggest a role for the private sector’s profit motive to build capacity for energy supply. Numsa has become more worried that this may have been recommended by unscrupulous consultants who have a stake in the establishment of such private entities which may be waiting in the wings to exploit our people.

Workers rights and the LRA:

Numsa calls on Cosatu to convene a Labour Law Review Conference for purposes of amending labour legislation in the interest of workers suffering the brutality of employers who seek to maximize profits at the expense of worker rights.

Numsa demand that parliament should abolish labour broking and in this regard we are firm that the constitution of the RSA must be amended because it currently provides an avenue for labour brokers in terms of section 22 of the constitution.

Numsa has noted that Commissioners in the CCMA and Bargaining Councils are not acting in the interests of dismissed workers; it appears that arbitrations are done on the basis of profiteering and chasing after as many cases to increase income and quality work is not taken up

The Budget

The National Union of Metal Workers of South Africa listened to the Budget Speech by the Minister of Finance and we are convinced that this budget is anti-working class and anti-poor.

The budget has become a platform to take forward the neo-liberal macro-economic framework (GEAR) into a faster and higher reverse gear.

Our union is not surprised because we have consistently argued that the Treasury staff belong to the old order that resisted change, and continued to tie development of our country to the Washington Consensus, which has failed the world so miserably these last years.

We are afraid that the Minister of Finance has been overly influenced by the neoliberal priests, who can’t see beyond outdated neo-liberal stereotypes. We are sorry that he is so resolute to maintain the same policies that destroyed every opportunity we have for development and economic recovery.

Numsa rejects with contempt the cheap manipulation of language – talk of ‘Transforming the Economy’ - by the Minister of Finance when his budget retains the status quo. Although he talks of a new growth path, there is nothing to put us on such a path in this budget. The budget has got absolutely nothing to do with doing things differently. Indeed, it constitutes a declaration of war to workers and the poor, as its intention is to undermine the gains that we have secured under the dark days of apartheid.

The following are positions that Numsa will be placing to Cosatu to champion. Cosatu must consider calling for rolling mass action, in the form of a strike, mobilizing workers and the unemployed to take to the streets against the budget, and against the State of the Nation Address announcements and shortcomings:

·        inflation targeting must be dropped, and that the process to review fiscal and monetary aggregates as agreed in the alliance must be maintained.

·        Numsa rejects the three tier labour system now being introduced by the Minister of Finance, in the interests of capital, because all young people who leave tertiary institutions need quality jobs that pay a living wage.

·        Numsa rejects the involvement of the private sector in the delivery of National Health Insurance, in public hospitals management, and especially in the generation of electricity through so-called independent producers.

·        Numsa calls on our ANC to remind all our Ministers that the ANC promised the people and the workers of these country decent work; decent work is not available through labour brokers, therefore the ANC must ban labour brokers.

·        Numsa calls on government to appreciate that in a country that has just shed 900,000 jobs, much greater resources must be spent on creating decent jobs that pay a living wage.

·        Numsa think that the federation, Cosatu should mobilize the working class to come into the street, including the unemployed, the youth and the rest of our communities. We demand measures by government to ensure genuine change in the structure of South African economy, above all measures to ensure that the economy is transferred back to the majority of the people of this country. Such mass action must put an end to corruption that is fuelled by unscrupulous individuals through tenders.

·        Numsa calls on Cosatu to declare a S77 dispute on the increase of Eskom tariffs so that we may deal with the unacceptable increase.

Issued by Numsa National Executive Committee, 18 February 2010

Contact:

Castro Ngobese

National Spokesperson – 073 299 1565