South African Labour, Political Economy Update: State to Respond to Teacher Unions; Markets Shrink, etc.

South African labour organizations have engaged in numerous strikes during 2009 demanding that the government address the impact of the global economic crisis inside the country. Above SABC workers challenge management.
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South Africa: State to Respond to Teacher Unions Pay Demands Today

Sue Blaine
11 August 2009
Business Day

Johannesburg — THE government is to respond today to public sector unions' demand for a 15% salary increase for 2009-10, Department of Public Service and Administration spokesman Sefako Nyaka said yesterday.

Teacher unions have blamed the government for holding up teachers' salary negotiations by taking longer than the given 21 days to respond to union demands on a separate negotiation, to determine a new salary regime -- the Occupation Specific Dispensation (OSD) -- for teachers.

They made their 15% demand in the middle of last month. The demand was negotiable, said South African Democratic Teachers Union (Sadtu) acting secretary general Mugwena Maluleke.

The department said it was taking so long because it was wary of repeating the mistakes made in some nurses' OSD payment agreements. The mistakes inflated some nurses' salaries.

OSD agreements across the public sector are negotiated at department level, while salaries are negotiated in the Public Service Collective Bargaining Council.

Teacher unions and The Department of Basic Education are poised to sign an OSD agreement for teachers soon.

"We are just waiting to get a mandate on the financing (of the OSD agreement)," Nyaka said.

The OSD agreement, which was first tabled nearly a month ago, recognises experience by awarding one salary "notch" -- which equates to a 1% salary increase -- for every three years' experience, said Maluleke.

The base salary is R95000 a year for a fully qualified teacher, but the agreement also allows for negotiations on this base, with Sadtu wanting the base to be R180000. A fully qualified teacher has a qualification after studying for three years after matric.

The OSD agreement also allows for teachers who have not made this grade and who are paid less than the R95000 a year base salary to be "bumped up" t hrough a "recognition of prior learning" process. A condition is that such teachers undergo intensive training so that they are fully qualified by 2012, Maluleke said.


Cosatu supports public servants Bill

JOHANNESBURG, SOUTH AFRICA Aug 11 2009 15:59

The Bill to stop public servants from benefiting from business deals due to their government connections was welcomed by the Congress of South African Trade Unions (Cosatu) on Tuesday.

"There should now be a national debate, not just in Parliament, but throughout society, on how to put a stop to this national scandal of public servants using their official positions to enrich themselves and their families," the union federation's spokesperson, Patrick Craven, said in a statement.

The Public Administration Management Bill, proposed by the public service and administration department, bans public servants from taking jobs with companies involved in or seeking business deals with government bodies.

It also enforces a "cooling off period" of one year after public servants vacate their government posts for them to tender for public works.

Craven, however, added that a one-year ban did not "go far enough".

The Sunday Times reported that the chairperson of parliament's Standing Committee on Public Accounts, Themba Godi, described the one-year ban as "ridiculously short".

He told the paper government departments had last week showed their failure to deal with employees who were doing private business, referring to departments which appeared before Scopa hearings, and where at least eight were found to have lied and misled the committee about the actions they claimed to have taken against corrupt civil servants.

A fine of a million rand would be imposed on those government workers who resigned in order to join companies who received payments from public bodies they had awarded tenders to while still in office, Craven said.

"The urgent need for new legislation was exposed by the recent report by the auditor-general that more than 2 000 civil servants and their relatives have been awarded tenders worth R600-million by companies in which they had direct or indirect links," he said.

"The federation believes that everyone appointed to a position to serve the people must do that alone."

He said the legislation should include scrapping tenders and awarding them to the next company -- should it be found that an official or a member of their family was found to be benefiting from it.

This would negate the temptation to use official positions to advance business interests.

"Even if technically legal, if a public servant's family members are seen to be benefiting from tenders for public works, it still creates a bad smell and the suspicion among the local community that there is an element of corruption."

Craven called for the law to be passed as soon as possible and for it to be "rigorously enforced". -- Sapa

Source: Mail & Guardian Online
Web Address: http://www.mg.co.za/article/2009-08-11-cosatu-supports-public-servants-bill


SA manufacturing output shrinks 17,1%

JOHANNESBURG, SOUTH AFRICA Aug 11 2009 14:41

South Africa's manufacturing output fell sharply again in June compared to a year ago, pointing to more pressure on the economy's second biggest sector.

Statistics South Africa said on Tuesday output contracted 17,1% year-on-year in June, marginally less than the revised 17,2% fall in May.

Production ticked up on a monthly basis, the second consecutive monthly growth, suggesting some light down the road for the ailing sector, but the increase was less than in May, dampening hopes of a quick upturn.

Production rose by a seasonally adjusted 0,1% in June from May.

Manufacturing, a key employer, has been hit hard by a global downturn and weak local demand, helping push the country into its first recession in nearly two decades.

Statistics SA said factory output was down 3,0% in the second quarter compared to the previous three months.

Africa's biggest economy is expected to contract again in the second quarter, in data due for release next week, driven by a manufacturing and mining slump.

"The headline number is a bit worse than we expected, essentially showing that the manufacturing sector is certainly not out of the woods yet," Absa Capital macro strategist Jeffrey Schultz said.

"There's still a lot of pressure in the manufacturing sector and that's likely to reflect in next week's GDP number release. Certainly not a good number at all."

Some analysts said the data added weight to arguments for another interest rate cut this year, although there were signs that the decline was bottoming out.

The central bank's monetary policy committee starts a two-day meeting on Wednesday to decide on rates with a Reuters poll showing it will likely keep the repo rate unchanged at 7,5%.

The bank had cut rates by 450 basis points since December but paused in June on worries about sticky inflation.

The targeted consumer inflation gauge, however, eased sharply to 6,9% in June, raising speculation there was still room for more policy loosening this year, particularly on signs the economy may not recover as quickly as previously expected.

"We still believe the MPC will cut interest rates by 50 basis points on Thursday, mainly on the basis of the improved inflation outlook, continued contraction in economic activity and job loses," Investec economist Kgotso Radira said.

The rand and government bonds were little moved after the manufacturing data was released. --

Reuters
Source: Mail & Guardian Online
Web Address: http://www.mg.co.za/article/2009-08-11-sa-manufacturing-output-shrinks


NUM: Eskom strike not imminent

STELLA MAPENZAUSWA | JOHANNESBURG, SOUTH AFRICA - Aug 10 2009 12:11

The chief negotiator from the National Union of Mineworkers said on Monday he did not see an imminent strike at Eskom, which has offered an increased 10,5% wage rise.

NUM was consulting members on the offer from Eskom, which generates 95% of South Africa's electricity and 45% of Africa's power output.

The threat of power cuts--which would be a challenge to President Jacob Zuma's authority-- helped drive up prices of platinum and palladium last week and partly pushed the rand to a three-week low on investor worries about the impact on the recession-hit economy.

Blackouts early last year temporarily crippled mine output, metal smelters and manufacturing, denting economic growth.

"Our assessment at this point in time is that there is mixed feelings. Members will not easily ignore the 10,5%, however the issue of a housing allowance is very problematic," National Union of Mineworkers (NUM) chief negotiator Paris Mashego told Reuters.

"I haven't received a report from Cape Town, Eastern Cape, Polokwane and the Nelspruit area [but] if there are divisions we normally don't go into a strike in that situation because it might destroy the union."

"If I can get two or three more reports from other regions, then I will know exactly whether we will have a strike or not, but I don't think we will go to a strike at this point in time," Mashego added.

The union, which has about 16 000 members at Eskom, about half of the utility's employees, as well as smaller unions Solidarity and the National Union of Metalworkers (Numsa) want a 14% wage hike -- about double the inflation rate -- and a bigger housing allowance.

Eskom has increased its offer to 10,5% from 8%.

Eskom spokesperson Andrew Etzinger said the negotiating parties would meet again on Wednesday after unions consulted members.

"We have been flexible, we put an offer on the table and it's now up to the trade unions to assess the offer and we start on Wednesday again," he said, adding Eskom did not expect any strike action before then.

Etzinger said last week the firm had contingency plans to deal with any work possible stoppage.

South Africa is by far the world biggest platinum producer and also a major gold supplier.

A power strike would add pressure on Zuma as he tries to lead the regional powerhouse out of its first recession since 1992 and reassure angry residents in poor townships that his government is working to give them adequate housing, electricity and water.

A strike at Eskom would be the latest in a wave of industrial action that has led to above-inflation settlements, including agreements in the gold and coal industries.

The government also awarded a 13% wage hike to council workers last week, nearly double the inflation rate of 6,9% for June, to end a five-day strike.

Further above-inflation settlements would worry investors concerned that Zuma could adopt populist policies, bowing to pressure from powerful labour union allies.

Last week, the NUM said the three unions involved in talks with Eskom had agreed to undertake joint mass action, including a march on Eskom's headquarters on Thursday, if the wage and housing dispute was not resolved. - Reuters

Source: Mail & Guardian Online
Web Address: http://www.mg.co.za/article/2009-08-10-num-eskom-strike-not-imminent


Recession 'making South Africans ill'

JOHANNESBURG, SOUTH AFRICA Aug 11 2009 11:44

South Africa's first recession in 17 years could be to blame for an increasing number of stress-related illnesses, Pro Sano Medical Scheme said on Tuesday.

"Stress-related conditions could well be linked to the recession and are being seen across the board, in people of all ages and income levels," said Dr James Arens, clinical operations executive of Pro Sano Medical Scheme.

"Quite simply, it seems as though money worries and job insecurity are making people sicker and leading to increased hospitalisation and medical treatment," he said.

Arens said a number of medical schemes had reported a significant change in the usual claims patterns and it appeared medical aid claims were on the increase.

"Claims expenditure in the first half of the year are usually much less than what we've seen this year," he said.

"We normally notice peaks around May, June and July linked to winter ailments," he said.

However, claims received in the first part of 2009 were almost as high as mid-year claims, which was "worrying", Arens said.

He said the medical scheme had noted a significant increase in serious ailments requiring hospitalisation, such as cardiovascular illness -- hypertension, strokes and heart attacks-- as well as psychiatric conditions such as depression and other mental disorders.

These stress-related conditions could well be linked to the recession, he said.

Arens said schemes had also noticed an increase in the number of people joining the scheme, undergoing expensive hospital procedures and then cancelling their medical scheme membership soon afterwards.

However, patients were not the only ones feeling the pinch.

According to Arens, schemes were also noticing a marked increase in fraudulent claims.

"In these cases, what often happens is that a practitioner loads their bill, so that a legitimate procedure is padded with all sorts of additional codes, which patients often do not understand or think to question ... we see this happening all the time."

He said hospitals run as businesses were also feeling increased pressure to show profits and keep their shareholders happy.

"There are many cases where the length of a hospital stay has increased by one or two days-- for no apparent reason, adding thousands of rands to patient and medical scheme bills," he said. -- Sapa

Source: Mail & Guardian Online
Web Address: http://www.mg.co.za/article/2009-08-11-recession-making-south-africans-ill


SABC International goes down the tube

KEVIN DAVIE: COMMENT - Aug 11 2009 06:00

Here's an Mbeki-era legacy which needs a Zuma-type plan to fix. The legacy is SABC International, an ambitious programme which held that Africa does not need the CNNs of this world to tell the African story. Africans, or rather, South Africans, would do it.

News tsar Snuki Zikalala was given the task of setting up what would be the pride of Africa, eventually creating 13 news bureaux on five continents to give us a voice.

Hundreds of millions of rands have been sunk into set-up and running costs, with SABC International now a huge drain on the SABC's financial resources, it being one of the reasons the broadcaster wants a bailout from the government.

I was keen to see for myself this vision gone awry and to understand just how much of a basket case SABC International is.

SABC International was intended to run on the DStv platform, but through a long and sorry saga, it is not there. It has an outlet in Washington on a cable network, but outside this you can see it only on Sentech's Vivid platform, or after 1am when SABC2 has shut down for the night.

Vivid appears to be as hopeless as SABC International itself. After you have bought your decoder for about R1 400, the content is free -- but this is pretty much limited to SABC International and 15 religious programmes. It reaches just 50 000 households, a pathetic 0,5% of South African television households.

Vivid has no website and the call-centre options, which I accessed from the Sentech website, did not include a Vivid option. I guessed one and was put through to a salesperson who told me that Vivid was not available because of software issues. He said I could buy a decoder through Junk Mail.

The call centre mailed me a list of re-sellers, but none was able to supply a decoder and had not had it in stock for months. They seemed unconcerned as to when it might be available again. I sense that Vivid, too, has been a market failure, even though Sentech maintains that it has met its requirement of bringing television to under-serviced areas.

SABC was clearly betting that SABC International would be on the DStv platform, but after about two years of talks, it has yet to strike a deal with MultiChoice.

SABC International's champion, Zikalala, who has left the SABC, told me that MultiChoice was always keen on including the news channel. He blamed the group executive at the SABC, led by former chief executive Dali Mpofu, for the failure to conclude a deal to this effect.

Zikalala said that all MultiChoice wanted in exchange for a spot on DStv was access to one-year-old documentaries which were gathering dust on the shelf. He said while Multi-Choice wanted a news channel, the SABC group executive wanted an entertainment and news channel and negotiations broke down.

The result was that SABC International was all dressed up, with 13 news bureaux, including in Washington, New York, Jamaica, London, Brussels, Sao Paulo, the Democratic Republic of Congo, Harare, Senegal, Nigeria, Kenya and China, but had nowhere to go in terms of an audience to access its news.

Zikalala told me the channel has the best journalists, but a ­colleague who reviewed the offering for Multi-Choice said that the coverage was dreadful and while the SABC had all these far-flung reporters, they seemed to do little or no coverage themselves.

Perhaps not surprisingly now, the SABC is more than a little coy in telling us what this adventure has cost and continues to cost.

I asked DA and ANC members of the portfolio committee on communications, after the SABC made a submission to it, what contribution SABC International was making to the financial malaise. Neither party knew the answer. Likewise, inquiries at the ministry of communications produced the same result.

The SABC's submission tells us that it wants the government to pay half the costs of running SABC International. It has asked the department of communications and the treasury for this, but this has been declined. We are not told how much is involved.

The now defunct Empire magazine reported in March 2008 that SABC International had operating costs of R200-million a year.

Zikalala told me that costs were not that high. He said he thought he had the costs on his cellphone and would SMS them to me. He wrote: "We spent about R694[-million] of a budget of R602[-million]. The bureaux budget was R35[-million] and we spent R43[-million]."

He also said that he did not want to spoil his relationship with the SABC.

Zikalala said that Robin Nicholson, the SABC's chief financial officer, did not include a budget for SABC International in the SABC's projections because he thought it should be closed down. But members of the board thought differently.

MultiChoice said that discussions with the SABC are continuing, although they have been delayed by having to wait for the new board. My sense is that it does not particularly value SABC International's offering, as it has a number of channels that cover the African story.

The treasury also said that discussions with the SABC are continuing.

Ismail Vadi, the head of the portfolio committee, and the department of communications referred inquiries to the new SABC interim board chairperson, Irene Charnley. Charnley did not return my calls.

Source: Mail & Guardian Online
Web Address: http://www.mg.co.za/article/2009-08-07-sabc-international-goes-down-the-tube