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Opinionista

We need a new social compact in South Africa — and trade unions must join the party

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Oscar van Heerden is a scholar of International Relations (IR), where he focuses on International Political Economy, with an emphasis on Africa, and SADC in particular. He completed his PhD and Masters studies at the University of Cambridge (UK). His undergraduate studies were at Turfloop and Wits. He is currently a Deputy Vice-Chancellor at Fort Hare University and writes in his personal capacity.

It is time to make our aloof social compact a reality. But to do that, we will need buy-in from government, big business, SOEs, and, especially, trade unions. The unions must realise their wage demands could wreck any plans to save our economy.

It has been 26 years since our necessary departure from a heinous racist system, apartheid. Much has been accomplished by our government and still much must be done to alleviate poverty, ensure the end of inequality and ensure sufficient provision of employment. This is evident all around us. But, hey, who ever said that colonialism and apartheid could be redressed in a quarter-century?

Many argue that it is the black government that has failed to meet these challenges. Others argue that we blacks were so focused on ensuring our political liberation, so focused on getting the vote for all our people, that we neglected our economic emancipation. And this grave oversight has caught up with us today.

As a result, the means of production remain largely in the hands of the white segment in our society. Now, 26 years later, the ruling party and some opposition parties want to correct this historic injustice and hence are coming up with various proposals, some not as palatable as others.

Some in our country argue that this new-found agency is actually informed by the fact that the ANC government has completely messed up the governance of South Africa through wasteful expenditure and of course the mighty and all-encompassing menace, corruption — the key contributor to all our woes currently in our country, it conveniently seems.

So, the government now comes up with proposals that want to collapse public and private sectors, like in health (National Health Insurance), as well as new debates and arguments around public and private schools. The South African Democratic Teachers Union (Sadtu) increasingly wants the Department of Basic Education interfering with independent schools. We have seen this during the current Covid-19 pandemic. Private schools get their act together, comply with the Covid safety regulations and want to start to recover much lost education time, but unions say “no” because it would give them an unfair advantage over their public-school counterparts, who evidently cannot get their acts together.

I am totally convinced that this approach of wanting to collapse and take from the haves to solve the challenges in our country, collapsing public and private sectors, is cutting one’s nose off to spite one’s face. When you have a segment in our society that works well, why do you want to fix what ain’t broken? Rather concentrate on the sector where more is needed and devote much-needed resources there. Surely?

The truth of the matter is that the general middle class — and what I mean by “general middle class” is both black and white — will increasingly invest in private-sector alternatives. Private universities such as the one AfriForum is completing will become the norm in the next decade. I have written about this before and won’t belabour the point here again. In the coming years, more haves will get off the grid and make use of private utilities for water and energy. This is simply a fact.

The president presented to us an Economic Reconstruction and Recovery plan last October as an attempt to fix our ailing economy. The problem with this plan is that it remains still only a government plan and does not specifically have the buy-in nor support of the other social partners. Here I am referring to the stakeholders in the Nedlac structure.

I would urge the president to conclude this social compact sooner rather than later. Because, when I look around, I don’t see a lot of goodwill from the other social partners. One only has to look at the public sector unions and how they are fighting tooth and nail for their new salary and wage agreements. They are disagreeing among themselves, with some unions even demanding in the region of a 10% increase.

They have also taken the government to the Constitutional Court to try to have the high court ruling on the 2018 salary and wage agreement overruled. Treasury has indicated that it is proposing a wage freeze until 2024, which would nearly halve our national debt if successful. But “oh no, hell no”, say the public sector unions.

Actually, what they are saying so loudly is, we don’t care about the plight of the majority of our people. To hell with them (the people) for demanding the extension of the Covid-19 special grant. Currently, millions of poor citizens are relying on this meagre grant for basic survival, but it seems the unions don’t care. They only care about themselves and their families.

I have spoken of the ugliness that has come to the fore during this Covid-19 pandemic. Internationally, we see it playing out around the vaccine wars, with the wealthy countries ensuring they take care of themselves and no one else. Similarly, domestically we see each sector looking to take care of itself at the expense of the others. The private sector keeps mum while many invest offshore and some list their companies on foreign exchanges, but make the bulk of their money here at home. Shameful to say the least.

What I take issue with here is the fact that I have no problem with local companies seeking better opportunities and cost-effective means elsewhere, but stay here. Have national pride and business confidence to stay on the JSE. When I look at America, many companies have taken their core business to the Far East and to many Latin American countries, but the primary listing remains on Wall Street, New York. They pay their taxes at home.

Why do our companies not demonstrate such patriotism and commitment to the future of our South Africa? Naspers is the latest company to abandon its traditional market. At the same time, we have unions demanding ever-higher increases and bugger the rest and government attempting to make ends meet with an ever-shrinking tax base and churning at the doors of international lenders.

So, in order to move the country forward, Mr President, you have to start working the field at Nedlac to ensure the buy-in and a REAL contribution from each and every partner there.

Again I ask, is it really about the failures of our government over the past 26 years, or is it about correcting a historic injustice?

Short of painting a rosy picture these past 26 years (take a cursory look at the Institute of Race Relations independent survey “The Silver Lining”), many mistakes have certainly been made. Inexcusable corrupt practices certainly happened, as we now observe at the Zondo Commission. We are equally regularly informed of much private-sector corruption, or, as it is known, collusionary practices. The World Cup stadiums, cement price-fixing, the banks recently on bank charges, flour price-fixing, bicycle price-fixing and many, many more. Is it just our culture to be corrupt in Mzansi, I wonder?

The private sector has to a certain extent come to the party, with lots of commitments of investment into the economy, thanks to the president’s investment conferences over the past few years. More must be done.

We are collectively tired of hearing hot air around spectrum, Eskom, energy provision and land distribution, to mention a few subjects.

With regards to the spectrum, please instruct the legislature to pass laws protecting us, the ordinary people, and not the big corporations. Smash data cost to zero; it must be done now. Why is it that Vodacom can have cheap data in Nigeria, but not in its home country? Why is that?

The fact that our public broadcaster is still largely analogue cannot be our problem; no, it’s had ample time to correct this shortcoming.

Legislate that bank charges must fall away and give the big banks three years to completely eradicate these onerous charges. Many world-class banks in Europe and the UK have for years not been applying bank charges and the argument from our banks that this is what makes them world class is utter bollocks, if you ask me. Are they suggesting that these other banks are crap as a result of not charging bank charges? That’s ridiculous, if you ask me.

As for our state-owned enterprises, let’s do what must be done. Difficult choices and decisions must now be made — we cannot postpone these any longer. SAA and Eskom must lose their excess human resources, period. Both entities have too many employees, fire them now and redesign these SOEs. I don’t want to talk about the smaller SOEs like Denel, Land Bank and so on.

Mining houses also need to grow backbones, mechanise and let workers go if need be, or re-skill and retrain them to be fit-for-purpose, but do what you must. We cannot be held hostage by workers to our long-term detriment. Part of your clean-up campaign promises in 2019 also meant dealing effectively with wasteful and fruitless expenditure at all these smaller entities.

So, is it really about the failures of our government over the past 26 years, or is it about correcting a historic injustice?

You be the judge.

We must all play our part so that the aloof social compact becomes a reality. DM

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  • Rasheed Gutta says:

    Well summarised. Action plan needs to be IMPLEMENTED IMMEDIATELY by ANC GOVERNMENT!!

  • Sergio CPT says:

    A good piece. Oscar, but disagree totally on two main issues: 1) you are too apologetic to the anc about the 26 years that they have been in power and control of all the money in the world. They started off well, but the wheels came off about 10 to 15 years ago, especially under the obnoxious zuma. It is now a wasteland, aided, abetted and shielded by the anc! They could have made a marked difference to health, schooling, job creation etc. but through corruption and misappropriation, adherence to failed socialist state command policies, complete ineptitude, nonsensical cadre deployment and putting their own party interest first and above all others, especially the country. Stop always blaming only apartheid for the country’s ills – a lot today has to do with failed, deceitful, arrogant and outright stupid policies followed by an equally failed, deceitful, arrogant and stupid ruling party. 2) you are like Cyril who yesterday had the gall to call on the West not to be greedy with the vaccines. How hypocritical and disingenuous you both are! The fact that the West acts in the best interest of their country, has the funds and has the finger on the pulse is NOT greed Oscar! It is called putting the welfare interests of its citizens first, something sorely lacking in SA! And it is not only the West, Oscar, but other poorer countries than us. Contrast that to Cyril and his pathetic/moronic government. Asleep at the wheel, as usual, in a time of huge crisis and only woke up when there was a huge public outcry! We don’t have the funds to inoculate the whole population because of the systematic and endemic corruption, Oscar. Wake up!

  • Gerrit Marais says:

    Most of what you state here is just common sense which clearly has not been too common the past 20 odd years.

  • Glyn Morgan says:

    Oscar wrote – “The truth of the matter is that the general middle class — and what I mean by “general middle class” is both black and white — will increasingly invest in private-sector alternatives.” This is called “capitalism”. It is the only thing that will pull South Africa out of the dwang! If everybody from the economic bottom to the economic top “increasingly invested in private-sector alternatives” we would ALL gain. There is not much difference, apart from scale, between a billionaire (for example – Ramaphosa) and the guy at the side of the road selling oranges. Both are capitalists. In a country that supports free enterprise that guy selling oranges would get some sort of economic help, maybe his business could be classified as a “private sector alternative”. Using the crutch of 27 year-old apartheid is a cheap, outdated cop-out, an excuse for failing!

  • Sam Joubs says:

    Sod the social compact. You can talk about that again once all the corrupt politicians are behind bars and the keys thrown away7

  • Carsten Rasch says:

    The social compact is a dream that will never happen under the present gov. Why? It requires trust. Only a cadre will trust the ANC of today. We need a social compact desperately, but what we need even more desperately is for the ANC to be unseated.

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