Wednesday, January 25, 2017

Radical Transformation of the Wholesale and Retail Sector: A Call for Unity in Action
19 January 2017

The SACP is seriously concerned about persisting intransigence and resistance to economic transformation in the wholesale and retail sector. The sector is dominated by a handful of oligopolies destroying co-operatives, small, micro and medium enterprises (SMMEs) and informal businesses in townships, peri-urban and rural areas. The rise of malls in these areas is also being carried out in a manner that systematically deepens the destruction of co-operatives, SMMEs and informal businesses, by means, among others, of oligopoly market conduct and collusion to conserve and heighten market dominance rather than a transformative developmental approach that ensures inclusive economic participation.

The intransigence and resistance to transformation in the wholesale and retail sector, which is driven primarily by none other than the oligopolies, is now being mounted against education and training interventions and initiatives aimed at driving mass empowerment of the historically disadvantaged, the workers and poor in townships, peri-urban and rural areas. This includes a drive, and fronting, to extend oligopoly domination on every inch in the townships, peri-urban and rural areas and suppress the emergence of a thriving co-operatives and SMMEs sector. In addition to opposition to the empowerment of the historically disadvantaged, poor and workers, the oligopolies are deepening labour exploitation economically and the exploitation of the workers and poor at the till. Casualisation, labour brokering and the slavery of meagre wages are rife in this sector.

The SACP condemns in the strongest terms possible the abuse of legal processes, including unnecessary court challenges used as a means to try and block transformation. We are calling on all progressive forces to stand up and unite against the oligopolies and monopoly capital. The SACP will initiate a new platform and processes of organisational formation in the form of a broad front of the forces for democratic transformation dedicated to taking forward the struggle in the wholesale and retail sector.

We are aware that, amongst other state interventions, the Department of Higher Education and Training had initiated a programme on rural and township economic revitalisation. The Wholesale and Retail Sector Education and Training Authority committed to contribute R107-million to the effort. The programme gained the support of the Department of Labour which pledged additional funding through the Unemployment Insurance Fund in excess of R100-million within the context of driving skills development for the workforce of our country. This effort is now being pushed back primarily by the oligopolies who do not even mind to manufacture baseless allegations to frustrate the national imperative of transformation and defend their economic dominance. This cannot be good news to the historically disadvantaged people of our country, especially in townships, peri-urban and rural areas.

The realities in the wholesale and retail sector are shocking. Apartheid patterns of economic control and management persist:

In 2013 Statistics South Africa conducted a survey entitled the Survey of Employers and Self-Employed (SESE) in the sector. The survey revealed that the number of informal businesses declined from 2.3 million in 2001 to 1.1 million in 2009 before increasing slightly to 1.5 million in 2013. The declining informal businesses are predominantly run by Black Africans, aged from 35 to 44 years and those with the lowest levels of education. The main reason why people started informal businesses was unemployment and having no alternative source of income.

What this clearly illustrated is that these informal businesses operate within the wholesale and retail sector, which contributed 12.5 percent to our economy's GDP (Gross Domestic Product) by 2013. If the government has to address economic and social inequality, unemployment and poverty, it has to intervene in this sector, including but not limited to skills development.

The oligopoly structure of the wholesale and retail sector include the likes of the Pick 'n Pay and Shoprite and Checkers cartels.

In terms of management structure the oligopolies have only 6.3 percent made up by Africans while 73.6 percent is made up by Whites. Female representation is 20.8 percent across the board with only 2.2 percent Africans, 1.4 percent Coloureds and 2.8 percent Indians. A similar picture emerges for senior management and professionals. In the unskilled category, the apartheid workplace continues. Africans make up an overwhelming majority of 85.9 percent, Coloureds 9.7 percent, Indians 1.4 percent while Whites are only 1.5 percent.

The introduction of National Skills Development Strategy III by the Minister of Higher Education and Training Dr Blade Nzimande is part of the core state interventions to transform our economy, including the wholesale and retail sector. This includes a focus on reducing inequality in terms of class, race, gender and geography - by means of rural development. The effort encourages and consists of measures to support the development of co-operatives, small enterprises, worker initiated training and the training of the unemployed, non-governmental organisations and communities. Skills development is not just about training people to become job seekers: It is also focused on empowering our people to create economic opportunities such as ownership and management participation to make a living.

Low levels of education and training, as well as the lack of standardised, appropriate and accredited training, are key constraints to enabling people to create their own opportunities. They are also constraints to up-scaling the contribution of co-operatives and SMMEs which have an important role in developing sustainable livelihoods and reducing inequality, unemployment and poverty.

The skills levy and training interventions in the retail and wholesale sector and across our economy must not be misconstrued to be only for addressing the plight of the employed workers without regard to the unemployed. If the wholesale and retail sector has to be inclusive, it has to invest more of its time and resources in skilling our people especially the workers and poor with a strong focus on townships, peri-urban and rural areas and transforming ownership and management, as well as ensuring more participation by Black people in professional and technical areas.




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