R.S.A. Budget Speech

Labour bills to be reviewed, resubmitted – Mildred Oliphant

Mildred N Oliphant

24 May 2011


Minister also planning to repeal and replace Occupational Health and Safety Act


Extracts from the Budget Vote Speech by the Honourable Minister of Labour, Mildred N Oliphant in Parliament, Cape Town, May 24 2011

The SA economy in 2010 began to show signs of recovery from the recession as we experienced in year 2009. In the fourth quarter of the same year we also saw a small gain in employment, with growth projected to be positive during year 2011.

As part of our commitment and effort in bringing about a society based on justice and equality for all, the department identified policy gaps in the following legislations:

  • Labour Relations Amendment Bill, 2010
  • Basic Conditions of Employment Amendment Bill, 2010
  • Employment Equity Amendment Bill,2010, and
  • The new Employment Services Bill, 2010.

In recent times, labour brokering has attracted a huge policy debate in our country, mainly due to abuses that have commonly been associated with the practice. It is for this reason ladies and gentlemen that one of our key aims in amending labour legislation is to address the phenomenon of labour broking and its associated abusive tendencies.

We do this well aware, that amending this legislation will have important consequences for the operation of the labour market system. The debates on these bills have attracted a variety of responses which illustrate clearly the articulation of different interests that could be affected by the proposed amendments.

As government, through the department of labour, we will continue to work constructively with our social partners and will further endeavor to find appropriate labour framework that gives sufficient protection to workers that have been rendered vulnerable through certain abuses. We will do so, mindful that our policies should not have negative consequences for employment.

The new Employment Services Bill sets out the proposed legal framework for the operation of our employment services. This Bill also sets out the role of Productivity South Africa under the mandate of the Department and provides a legal basis for the operation of the Sheltered Employment Factories.

We will continue to step up our commitment to improve our employment service to contribute to job creation inSouth Africa.

In September 2010, the department launched the South African Decent Work Country programme at NEDLAC. Through this programme, the ILO will work together with government, organised business, organised labour and the community constituency to give support to initiatives aimed at promoting the decent work agenda.

Speeding up economic growth and transforming the economy to create decent work and sustainable livelihoods is the first priority of government for 2011 and also through to 2014. Decent work will feature strongly in all economic policies during the coming period.

Despite the significant progress in changing our economy to benefit our people, unemployment, poverty and inequality remain serious challenges. Decent work is the foundation of the fight against poverty and inequality and its promotion should be the cornerstone of all our efforts.

“We strongly support fair globalization and resolve to make the goals of full and productive employment and decent work for all, including women and young people, a central objective of our relevant national and international policies as well as our national development strategies, including poverty reduction strategies, as part of our efforts to achieve the Millennium Development Goals.”

This commitment has led to the whole United Nations system recognising the Decent Work Agenda and to placing it at the centre of relevant national and international policies and development strategies. So, the direction that we are now taking inSouth Africais not new, in fact, it is overdue.

Decent work has been defined by the ILO as being productive work for women and men in conditions of freedom, equity, security and human dignity. Decent work involves opportunities for work that is productive and delivers a fair income, provides security in the workplace and social protection for workers and their families, offers better chances for personal and skills development, gives people freedom to express their concerns, to organise and to participate in decisions that affect their lives and guarantees equal opportunities and equal treatment for all.

The Decent Work agenda of the ILO is made up of four pillars. These are:

  • Employment creation and enterprise development;
  • Social protection;
  • Standards and rights at work;
  • Governance and social dialogue.

These four pillars are intended to work together in an integrated manner and to apply to different areas of policy, to policies directed at the workplace and the way in which people carry out their livelihoods. What is important to realise about decent work is that it does not prescribe a ‘one size fits all’ approach. A decent work agenda forItalyandEthiopiamay look very different to the one forSouth Africa.

Our employment creation strategies must speak to the realities of the South African economy and labour market. Our priorities in the area of social protection must address the gaps that we find here. The South African constitution, the Labour Relations Act and Basic Conditions of Employment Act provide a strong floor of rights and standards.

Equally, we have a very good framework in our legislation for governance and social dialogue, although we may need to find ways of strengthening our practice of social dialogue.

In pursuing decent work in our context, it is our national priorities that must shape our response going forward. The Framework agreement between the social partners on how to respond to the international economic crisis simply says:

“By decent work we mean the need to increase the level of employment as well as improve the quality of jobs.”

Decent work is, therefore, a package deal, an integrated way of looking at work in our society in conditions of freedom, equity, security and human dignity. And we already have some targets, the most important of which is the target of halving unemployment by 2014.

The Department will, in the 2011/12 financial year focus on the following strategic areas:

  • Reviewing and submitting to Parliament amendments to labour legislation – the Basic Conditions of Employment Act, Employment Equity Act, Labour Relations Act and a new Employment Services Bill. Our aim is to create a policy framework to promote decent work, and a policy framework for the provision of public employment services which will enable government to maintain a database of job seekers and job opportunities, as well as matching and placement of job seekers.
  • The Department will during the 2011/12 financial year consult with stakeholders and on conclusion, present the bills to Parliament. The Occupational Health and Safety Act 85 of 1993 pre-dates the Constitution of the Republic and requires updating, in certain areas. The Department intends to repeal this legislation and replace it with new OHS legislation to ensure a safe and healthy working environment and to protect workers against hazards associated with their work or use of machinery.
  • Strengthening Inspectorate – inspectors’ posts at specialist levels.
  • Reduce inequality and discrimination in the labour market through effective compliance monitoring and enforcement of the Employment Equity Act and this Act is currently under review.
  • Improve access to social security services provided in terms of the Compensation Fund and Unemployment Insurance Fund; including reintegration of workers into the labour market.

The department’s focus areas for 2011/12 will aim to reduce the decent work deficit through improved enforcement and efforts to ensure compliance with our labour laws.

Various branches and public entities within the department have outlined plans to contribute to creating jobs, saving jobs in identified distressed companies and sectors and placing in excess of 2 million work-seekers in jobs over the period 2011/12 through to 2013/14.  Interventions planned by the department involve training, re-skilling of workers in order to give them capacity to compete in the open economy. Funding to be provided through the Compensation Fund and Unemployment Insurance Fund will include:

  • A continued investment of R 9 billion of the R26,5 billion portfolio in commercial and Socially Responsible Investments by the Compensation Fund;
  • A continued investment of R 44 billion of the R52 billion portfolio in commercial and Social Responsible Investments by the Unemployment Insurance Fund
  • The Unemployment Insurance Fund has set aside R1 billion over the 2009/10 – 2013/14 medium term period for the schemes that are aimed at re-integrating unemployed UI Fund beneficiaries back into employment. The scheme is funded by the Fund and involves participation by various Sectoral Education and Training Authorities in re-skilling the unemployed in critical scarce and soft skills.
  • To further assist in preventing retrenchments, the UI Fund has committed R1. 2 billion towards the Training Layoff Scheme. This scheme is designed to provide support to companies in distress that intend to retrench employees.
  • ProductivitySouth Africa’s Social Plan will be given R290 million in funding over the period 2011/12- 2015/16. This is funding that will go towards providing assistance to companies in distress.

The Public Employment Service branch of the Department has identified a number of interventions aimed at creating and sustaining jobs. The highlights are as follows:

  • The department aims to refer 450,000 work-seekers for placement in jobs and other opportunities in 2011/2012 and in excess of 2 million work-seekers will be referred for placement in opportunities over the period 2011/12- 2015/16. This will be accomplished through the job matching exercise in the Employment Services System of South Africa known as ESSA.
  • Through the employer services functions the department aims to provide assistance to 51,500 workers in distressed sectors over the period 2011/12- 2015/16.
  • There are 151,000 people from designated groups who will be placed in training and income generating opportunities over the period 2011/12- 2015/16. The total targeted group comprises of 10,000 Youth, 15,000 Women and 4,000 persons with disabilities.
  • About 3,200 learners will be recruited over the period 2011/12- 2015/16 to participate in Sheltered Employment Factories’ Centre of Excellence with the view of training them as mentors and placed in both the Sheltered Employment Factories and in the open economy.
  • In addition to contributing to job creation during 2011/12, the Strategic Plan of the Department outlines a number of ways in which the Department intends improving its efficiency and service delivery. I will not list all of these, but examples include:
  • improvements in the time taken to finalise compensation claims;
    • improvements in the processing of claims for unemployment insurance benefits;
    • increased sale of products from the sheltered employment factories;
    • a campaign aimed at reducing exposure of workers to silica dust, and;
    • eliminating the department’s vacancy rate. The Department has employed Director General, Nkosinathi Nhleko who has undertaken to eliminate vacancy rate within this financial year.

We are also looking forward to hosting the 12th Africa Regional meeting of the International Labour Organisation (ILO) during October 2011. This meeting will be attended by a number of Heads of State of African countries as well as the Director General of the ILO.