Address by COSATU General Secretary, Zwelinzima Vavi, to the COSATU Bargaining, Organising and Campaigns Conference, Birchwood Conference Centre, March 12 2013

An Overview of the Collective Bargaining, Organising and Campaigns Challenges that we face

I don't want to waste any time in getting into the nuts and bolts of what we have to talk about over the next four days. But I do have to say how wonderful it is to see such full Affiliate delegations, hopefully all ready to engage robustly in both plenary sessions and in the Commissions.

This Conference is taking place at a time when the labour movement is facing some very serious challenges - both internal and external. Some are self-inflicted, and some are being pursued by our class enemies, to fatally weaken us. This calls for cool heads and clear strategies. We are convinced that we can rise to the occasion. But how we deal with these challenges could determine the future of the labour movement for the next 20 years.

This Conference is therefore charged with the very weighty responsibility of charting a clear course for the organised working class - boldly confronting our weaknesses, building on our strengths, and using our decades of experience of working class struggle to successfully navigate these stormy waters.

In the socio-economic report to the 5^th Central Committee in 2011, we noted a number of proposals relating to economic transformation that may prove to be a challenge for the working class. These included a number of labour market reforms that have been put forward that point towards the creation of a two-tier labour market:

a) limitations on collective wage-bargaining not to cover certain categories of workers,

b) minimum wage-differentiation by age,

c) youth wage subsidies,

d) extension of probationary requirements for the newly employed,

e) wage and price moderation. 

These proposals were inspired by the South Africa Economic Survey Report released in 2010, by the OECD. Since then the IMF and the National Planning Commission, have lurched on to them. Capital is in crisis, and it will do everything to smash us from all sides, in order to restore profitability. We thus have to be cool-headed and know the class enemy, even if the enemy wears our colours and is within our midst. 

COSATU is the multi-wheeled locomotive of the working class, its wheels are its affiliates, and it is affiliates that are the strategic target. So it is important that we really focus on our organisational strengths and weaknesses, share experiences and emerge with a common, dynamic strategy and tactics.

This Conference is taking place in the context where capital has created such high levels of unemployment that it is bold to accuse workers of exacerbating the problem. We read theories that suggest that COSATU is a barrier to job-creation for young people; we were besieged by the DA in our headquarters, and we are being besieged in the policy space. Unemployment is a necessary outcome of capitalism, but it is extreme in colonial economies like South Africa.

It is important to understand that, while unemployment is an intrinsic outcome of the capitalist mode of production, it plays an important role in weakening the power of the working class at the point of production, and in society broadly. 

In Capital Volume I, Chapter 25, Marx states that the "the mechanism of capitalist production so manages matters that the absolute increase of capital is accompanied by no corresponding rise in the general demand for labour", primarily because capitalist accumulation is characterised by decreasing labour intensity, which is driven by competition among capitalists and the tendency for capitalists to always find ways to decrease labour costs in order to boost profits.

The industrial reserve army of the unemployed that is created as a result of this process "compels those that are employed to furnish more labour". And so, Marx proceeds, "in the same measure as [the workers] work more, as they produce more wealth for others, and as the productive power of their labour increases, so in the same measure even their function as a means of self-expansion of capital becomes more and more precarious for them".

The poverty of the unemployed compels them to take poverty wages in desperation, whilst the pressure that the unemployed thereby generate on the already employed, compels those who are already employed to be subjected to all sorts of abuses: labour brokers, long working hours, no benefits, no access to legal protection, etc. This is what Marx calls "the despotism of capital" over the entire working class.

Consequently, in line with our 9^th Congress resolutions, in this input we put the socio-economic demands of the Freedom Charter at the centre in order to focus our analysis. Let us not forget Marx and Engels's words when they said: "people cannot be liberated as long as they are unable to obtain food and drink, housing and clothing in adequate quality and quantity".

Let us also not forget what Engels said: "Democracy would be quite useless to the proletariat if it were not immediately utilised as a means of accomplishing further measures directly attacking private ownership and securing the existence of the proletariat". We will never be liberated unless we achieve the comfort that is promised by the Freedom Charter, unless we uproot the conditions that make us to have hands that are trembling with starvation.

The State of the Working Class

Education

The Freedom Charter states that: "The government shall discover, develop and encourage national talent for the enhancement of our cultural life; all the cultural treasures of mankind shall be open to all, by free exchange of books, ideas and contact with other lands; The aim of education shall be to teach the youth to love their people and their culture, to honour human brotherhood, liberty and peace; Education shall be free, compulsory, universal and equal for all children; Higher education and technical training shall be opened to all by means of state allowances and scholarships awarded on the basis of merit". In addition the SACP (1962) said: "Standards of education must be the same for all children, irrespective of race, home language or econo­mic status, and designed to develop citizens imbued with a love of their people, their country and humanity".

We have made progress to take forward this vision but challenges remain:

1. 42% of schools depend on boreholes or rainwater or have no access to water on or near site,

2. 61% of schools have no arrangement for disposal of sewage,

3. 21% of schools have no toilets on site or have more than 50 learners per toilet, of those with toilets 36% depend on pit latrines,

4. 16% have no source of electricity on or near site,

5. 41% of schools have no fencing or the fence is in poor condition,

6. 93% of schools have no libraries or libraries are not stocked,

7. 88% of schools have no laboratories, or laboratories are not stocked and

8.   81% of schools have no computers or more than 100 learners share a computer. It is clearly very difficult, though not impossible, to discover and enhance national talent under these conditions.

9. Teachers are yet to get the promised laptops

We thus have to understand the conditions of employment under which teachers operate, including the fact that in many cases, these schools are located in poverty-stricken communities, with extreme levels of unemployment and hunger.

Health

In 2006, a black female South African expected to live 12 years shorter than a white male, and an average male in Sweden expected to live 30 years more than an average black South African female[30]. The life expectancy of South Africans was the highest in 1992, at 62 years. Ever since then life expectancy fell to 50 years in 2006. The situation seems to have worsened since 2006. The life expectancy of a white South African now stands at 71 years and that of a black South African stands at 48 years, according to the South African Institute of Race Relations Survey (2009). Whites therefore expect to live 23 years more than blacks according to the study.

The Freedom Charter states that: "A preventive health scheme shall be run by the state; free medical care and hospitalisation shall be provided for all, with special care for mothers and young children". 

The RDP calls for the creation of single national health system, driven by the primary health care approach. Furthermore, the entire health system is supposed to be located within the context of rising standards of living through improved wages and income-earning opportunities, improved sanitation, water supply, energy sources, and accommodation. All these provisions ensure that material conditions exist to shift the national health system from the catastrophically expensive curative mode to the preventive mode.

The scale of the health crisis in South Africa is still large. In 2010, we reported that

1. Maternal mortality has increased from 81 to 600 (per 100,000) between 1997 and 2005. The MDG target is 38.

2. Child mortality has been on the decline, but remains high at 68 (per 1000 live births), yet a comparable country Brazil has reduced this figure from 58 in 1990 to 22 in 2007.

3. There are 1000 AIDS-related deaths per day (and another 1,450 people becoming HIV infected each day).

4. Moreover, while we seem unable to treat more than half the 800 000 needing anti-retroviral treatment, that number is going to rise to 5.5 million within five years (these are people already HIV infected who will reach full-blown AIDS).

COSATU notes that HIV and AIDS is one of the major challenges facing South Africa today. Of the 48 million South Africans in the census preceding the last one, 5 700 000 estimated to be HIV infected with a prevalence rate (15-49 yrs) of 18.1%. Most of these are women (3 200 000) in urban and rural informal environments and 334 000 are children.

It is again a known fact that South Africa is one of the 22 High Burden Countries that contribute approximately 80% of the total global burden of all TB cases, the seventh highest TB incidence in the world. Unfortunately the incidence of tuberculosis has increased during the past ten years, in parallel to the increase in the estimated prevalence of HIV in the adult population. This has resulted in increasing recognition of the problems posed to public health by TB. Generally TB control is facing major challenges. Co-infection with Mycobacterium Tuberculosis and HIV (TB/HIV), and multi-drug-resistant (MDR) and extensively drug resistant (XDR) tuberculosis in all regions, make prevention and control activities more complex and demanding.

In terms of health insurance, almost 25% of South African households have at least one member who belongs to a medical aid, only 17% of individuals have medical aid scheme coverage and 90% of households do not belong to a medical aid scheme because they do not have money to pay for it. Only 9% of the African population belong to a medical aid scheme whilst 74% of the white population do. This is reflected in the imbalance in terms of life expectancy. A white person born in 2009 expects to live for 71 years, whereas an African born in the same year expects to live for 48 years. This means that white people expect to live 23 years more than Africans. These facts had not changed by 2011.

All these mean that we need to vigorously support the NHI, call for redistribution of resources and transformation of the health system into one that is based on social solidarity. We must make sure that it is funded in a progressive manner, through a progressive tax system and other measures.

Basic goods and services

The Freedom Charter states that: "All people shall have the right to live where they choose, be decently housed, and to bring up their families in comfort and security; unused housing space to be made available to the people". It furthermore states that "slums shall be demolished, and new suburbs built where all have transport, roads, lighting, playing fields, crèches and social centres". How far have we advanced in realizing these demands?

In terms of water and sanitation, the General Household Survey (2009) notes that the "percentage of households who receive piped water supplies from their local municipalities increased from 74,5% in 2007 to 83,3% in 2009". The survey further reports that an estimated 50% of households do not pay for piped water. This is an important advance for the working class. Households without a toilet or who use the bucket system declined from 8% to 6% between 2007 and 2010. Over the same period households whose refuse removal is by a municipality declines from 62% to 57%. 

While these advances must indeed be acknowledged, it is important for COSATU to begin interrogating the class character of these service delivery gains. Many argue that these add significantly to the so-called social wage and are thus redistributive, but a proper Marxist analysis would reveal that, in the context where the rate of exploitation is rising, so-called service delivery is nothing but the transfer of value from the employed section of the working class to the unemployed part. As Marx put it, the bourgeoisie have so designed the system such that the burden of the reserve army is shouldered by the employed section of the working class.

Despite progress, we see that the spate of service delivery protests continues. The working class is engaged in struggles on many fronts and it is important that we re-build bridges and links with other forms of organisation of our class in order to win the struggle. The capitalist class is fighting us in the airwaves, in school curriculums, in Universities, in factories, abroad, everywhere. 

We therefore need to realise that though very important, trade unions are just one form of organisation, we need to build other forms of organisation, build the mass democratic movement into a fighting, working class led movement. We need to draw in revolutionary intellectuals, the youth, etc. into the mainstream of our struggles.

Housing

In 2010, we reported that there has been progress in the provision of housing since 1994; 74% of South African households live in brick structures, flats and townhouses. 

Nevertheless there remain 15% of households who live in shacks, which amounts to 1.875 million households, which is equivalent to 7.5 million people. 

Despite the progress that has been made in the provision of decent human settlements, the quality of housing remains a major challenge;

1. 46% of South African households live in dwellings with no more than 3 rooms,

2. 17% of households live in 1-room dwellings.

3. Among Africans 55% live in dwellings with less than 3 rooms and

4. 21% live in 1-room dwellings, whereas at least 50% of White households lives in dwellings with no less than 4 rooms.

These disparities in the conditions of living are a direct consequence of the legacy of apartheid, and the accumulation path that underpins it. 

The Labour Market

The RDP proceeds from the following premise: "Central to building the economy is the question of worker rights. Past policies of labour exploitation and repression must be redressed and the imbalances of power between employers and workers corrected. The basic rights to organise and to strike must be entrenched. And negotiations and participative structures at national, industry and workplace level must be created to ensure that labour plays an effective role in the reconstruction and development of our country".

Key elements of worker rights are succinctly enshrined in the Freedom Charter:

• All who work shall be free to form trade unions, to elect their officers and to make wage agreements with their employers;
• There shall be a forty-hour working week,
• A national minimum wage, paid annual leave, and sick leave for all workers, and maternity leave on full pay for all working mothers;
• Miners, domestic workers, farm workers and civil servants shall have the same rights as all others who work;
• Child labour, compound labour, the tot system and contract labour shall be abolished

This Bargaining Conference must ask: How far have we moved in realising all these demands since 1994? Here are some facts about the South African workplace.

1. In terms of fair incomes in the workplace, we note that in 2010, half of South African workers earned less than R2 800 a month. On average, 75% of South African workers earned R1 939 in 2010 and 90% of South African workers earned an average R3 327 a month. African workers earn 23% what white workers earn, and women earn 77% what men earn.

2. The PriceWaterhouseCoopers Report (2010) on Executive Pay over-estimates the wages paid in the South African economy when it says: "The lowest paid workers have monthly salaries of around R3 500". The Monthly Earnings of South Africans Report (2010) of Statistics South Africa reveals that actually, the bottom 5% of South African workers are paid less than R570 a month, which implies that the PriceWaterhouseCoopers Report overstates the wage 6.14 times. Despite this overstatement, we observed that the Executive Pay report found the pay gap to be in the order of 250-300 times the lowest paid worker. If we then correct the wage of the lowest paid worker, we find that the median executive pay gap ranges from 1 535-1 842 times the wage earned by the lowest paid worker.

3. In its analysis of wage inequality from 30 countries, the ILO in its Global Wage Report (2009/10), the ILO reports that 33% of South African workers are in "low wage employment", defined as those workers who earn less than two-thirds of the median wage (R1 867) or in the case of the EU definition 75% of the average wage. But 75% of the average wage is almost equal to the average minimum wage, which was R3 336 in 2010. This measure would place more than 55% of South African workers in low wage employment.

4. Building on our 9^th Congress resolution, we proposed in 2010 that the pay-ratio of the top 10% highly paid managers in companies to the bottom 10% lowest paid must converge to 16:1 over time[1]. Targets for reducing the wage gap need to be contained in plans submitted in terms of a strengthened Employment Equity Act. We also called for active steps to be undertaken to close the apartheid wage gap. Specifically, we proposed that the tax system should be actively used to deal with inequalities in the labour market. The trends in terms of pay, the inequalities in the labour market and the fact that there are no policy interventions to deal with these problems are clearly not in line with our expectations as the Federation.

5. The Freedom Charter says that there shall be a national minimum wage. Yet, one of the areas that bourgeois apologists always raise regarding the discussion on labour market performance is the issue of minimum wages. They claim that minimum wage laws lead to unemployment, since many firms may not be able to pay them. However, a recent study has shown that 44% of employees were violated and received sub-minimum wages in 2007. The depth of the shortfall is also quite significant. The study reports that workers were paid on average, 35% less than the legislated minimum wage in South Africa. The study further reports that non-compliance with the minimum wage is highest within the "security sector, with worryingly high estimates reaching nearly 70% in some areas in 2007, followed by the farm and forestry sectors (55% and 53% respectively)"[2]. The average minimum wage in South Africa was R3 336 in 2010. The minimum wage violations therefore imply that approximately R16 billion per month is being extorted low-paid workers. In addition, these minimum wages are reported by the Labour Research Service Report on Bargaining Indicators (2011) that they are 19% below the living wage level of R4 105. Therefore the call for a national minimum wage in the Freedom Charter is yet to have effective meaning for 44% of the workforce.

The Freedom Charter states that: "The state shall recognise the right and duty of all to work, and to draw full unemployment benefits". However the Unemployment Insurance Fund does not cover 43% of workers and 49% of women in the workforce are not covered by the UIF. In terms of social protection, we have seen that, according the General Household Surveys, 77% of the unemployed rely on employed workers for survival. In addition, given the fact that minimum wages are widely violated in South Africa, this legislative intervention is also not effective in providing strong income protection for the lowest paid workers. The other social protection that is in existence are social grants, particularly Child Support Grants which, despite being grossly inadequate, are meant to cover the well-being of children. In short, social protection of families in South Africa is extremely weak if non-existent. 

The Freedom Charter further calls for a forty-hour week. It states that all those who work shall have paid annual leave, and there shall be sick leave for all workers and maternity leave on full pay for all working mothers. As of 2012:

1. 85% of the workforce was working for more than 40 hours a week. In particular, 30% of workers (3.4 million workers) work for more than 45 hours a week.

2. Only 32% of all those who work had medical aid benefits,

3. 71% of those employed were not unionised,

4. 43% of workers (5.8 million workers) had no access to paid maternity/paternity leave,

5. 31% (4.2 million workers) had no access to paid sick leave and

6. 35% (4.7 million workers) were engaged in contract and other short-term type of employment,

7. 50% of workers (5.7 million workers) have no access to a pension or retirement fund and

8. 33% of workers (4.4 million workers) do not have access to paid annual leave. Significant gaps therefore still exist, almost twenty years into democracy, towards fully realising these aspects of the Freedom Charter.

Assuming a very conservative number of average excess hours of over-work of 5 hrs, this translates into 48.5 million hours of over-work by the entire workforce. All else being the same, this translates into 1.2 million jobs that could be created, but are currently turned into the reserve army of unemployment through the "over-work of the employed part of the working class".

Statistics South Africa does not report the use of labour brokers in the labour market directly. However by 2012 contract work of limited and unspecified duration accounted for almost 32% of total employment. In addition, while the Freedom Charter calls for workers to have rights to negotiate wages with their employers, 54% of the workers receive no regular wage increments or have their wages determined solely by their employers. Interestingly, despite a lot of noise by bourgeois apologists about the need to decentralise or even abolish collective bargaining, we find that bargaining councils cover just 9% of the workforce, while only 23% of the workers' wages are negotiated directly through unions.

Skills development and training is also a crucial aspect of the labour market. The Commission on Employment Equity Report (2010) observes that for professionally qualified workers, skills development and training remains biased towards Whites, who command 61% of the skills development and training among those who are professionally qualified. Among skilled workers, the Commission on Employment Equity Report (2010) says that: "it is evident that private sector employers continue to invest more training on Whites than on other population groups.

If there was willingness on employers to empower Blacks, it would have been evident in the training provided. This therefore suggests that employers are not utilising their training strategically to ensure that they empower the under-represented groups to ensure their upward mobility within the workplace"[3]. Unfortunately, the Commission on Employment Equity Report does not provide information about skills development and training of the unskilled segment of the workforce. We should therefore call for more detail in future Employment Equity Reports.

There are a number of interventions that should be made in the labour market to address the poor conditions faced by workers. COSATU should consider, among others, the following demands:

• Enforcement of an upper limit of a 40-hour work week across the board
• Taxation of firms that pay below the statutory minimum wage, and the distribution of such tax proceeds back to the workers concerned
• Tax reform to target executive pay and to set targets to close the apartheid wage gap
• The Department of Labour must set targets and timeframes to extend maternity leave and all other leave benefits to all workers, taking into account the fact that we are almost two decades into democracy
• Extend social protection and ensure that there is an income floor below which no South African worker or household should fall
• Set targets for the reduction of "low-wage" employment, through the introduction of solidarity measures in wage formation. This should be an integral part of realising our demand that the income gap between the highest paid and the lowest paid should be 16:1.
• Link skills development and training with career-pathing as part of the employment equity targets; skills development and training should lead to upward mobility of the workforce.
• Combat the suppression of young people's talents, especially African graduates, who are made to do jobs that do not assist in sharpening their skills
• We need to relentlessly fight the apartheid wage gap!

The second phase of the NDR cannot reproduce the terrible dynamics of the colonial and capitalist labour market as we have outlined. Transformation of the labour market must fundamentally alter the power relations between the workers and the employers, in favour of the worker. Labour market policy in the second phase of the NDR cannot weaken the power of the working class on the shop floor and should be aimed at ensuring that labour as a primary productive force, is developed and enhanced regularly and systematically in tandem with the development of other productive forces. 

The inequalities in the labour market must be decisively dealt with. A scientific analysis of the race, gender and class wage premium, which does not reflect the contribution of a person to production, must no longer be tolerated; it must be eliminated with immediate effect. The overwork of the workers must be drastically reduced, to ensure that larger numbers of workers are absorbed into employment.

This means that skills development and training, the elimination of the race, class and gender premium in compensation and the transformation of the labour process in favour of the working class should be the hallmark of the second phase of the NDR. In short, comrades, we need a package that deals with labour market transformation within the overall context of transforming the growth path.

Sadly, you have to read for yourselves what the National Development wants to do, or not do, with the labour market. In relation to the labour market, the NDP says:

1.  Offer a tax subsidy to employers to reduce the initial cost of hiring young labour market entrants. [We have extensively criticised this proposal based on facts, we were ignored].

2.  Clarifying dismissal and retrenchments provisions in the Labour Relations Act (1995) Code of Good Practice and its management, ordinary unfair dismissal protections should not apply to those on probation for up to 6 months, private mediation or the courts, not CCMA, to administer labour laws for seniormanagers [In short, people who earn above R300 000 per annum cannot access the CCMA anymore, this is likely to hit hard at experienced workers and young graduates!]

3.  To ease entry into formal work opportunities, ordinary unfair dismissal protections should not apply to employees on probation, up to a limit of six months of service. [This is extension of probation and labour market flexibility]

4.  On dismissals: misconduct or poor performance, reduce the regulatory burden by revisiting the pre-dismissal procedures, any appeal or reversal of a dismissal should be ruled on substantive and not procedural grounds, except in the case of constructive dismissal. [Again this increases labour market flexible and vulnerability of workers].

5.  Review regulation and standards for small and medium enterprises, reduce the regulatory burden for SMMEs, the Code of Good Practice must clearly lay out procedures appropriate to small businesses, simplify EE compliance and skills development requirements and reporting for small firms [This may create a two-tier system wherein part of the economy is not regulated by labour laws and employment equity act].

6.  Give a subsidy to the placement sector to place matric graduates, effective regulation of the private labour placement sector and temporary employment services. [In short comrades, we must give a subsidy to labour brokers!]

This raft of policies and others, generate a déjà vu, we have been through this before, through that infamous document called GEAR!

Organisation, organisation and organisation!

In our Congress last year we spelt out many of the organisational challenges we face, and took a number of resolutions on steps that need to be taken to improve our collective bargaining, our servicing, and our organising in general. But these four days will hopefully take us a few steps further into elaborating on the detail. We need to emerge from this Conference with a unified set of principles in the following areas:-

• On strategies for recruitment and organising, with a particular focus on vulnerable workers
• On strategies and policy for wage bargaining - including conclusive debate, on the proposal for a National Minimum Wage
• On proposals for the establishment of comprehensive, legislated centralised bargaining in all sectors
• On strategies and policy for improving social benefits of workers (referred to as the social wage)
• On strategies and policy for social protection
• On the way forward in our national Section 77 dispute on socio-economic transformation including on the last class war declared by Free Market Foundation on Centralised Bargaining system.

The central thrust of this week's Conference lies in the axis of organising and collective bargaining, and the relationship between the two. Right in the middle of this axis stands the need to deliver to our members on wages and working conditions. We are truly called to go back to basics, and reassert the fundamental values and organisational culture of our movement ; but also to be creative in the way we exercise the power of worker democracy, under new conditions which are emerging. And develop innovative strategies which rightfully position the trade union movement as a leader of society.

We have to deliver on wages and working conditions for two good reasons. The first is that COSATU members have already told us in the NALEDI Workers' Survey conducted in 2012 that this is one of the two most important reasons that they have joined a COSATU affiliate. The other reason they have given us, by the way, is to be protected against unfair discipline. Only 3% of our members have said that they join our unions mainly because of other benefits.

The second reason that we have to deliver on wages and working conditions is that this is at a centre of building a better life for all. A living wage is the corner stone of our endeavours to liberate the working class from poverty and to make sense of the now hidden and now open class fight for the social surplus workers produce. If we can't stand together in our individual unions and in the Federation as a whole to demand - and win - significant improvements for our members, then we will not be able to stand together to win other social and political demands.

2012 was an extremely tough year for COSATU and its affiliates in general. But it was toughest on our biggest affiliate, the NUM. As spelt out in the COSATU Congress Special Declaration on Marikana the NUM has borne the brunt of a society and economy under extreme strain, in the context of global capitalist crisis. Capitalist crises always produce bosses who scramble to restore their profitability at the expense of workers.

In the case of the Platinum sector, this took the form of sub-contracting and labour broking, retrenchments, strategies of divide and rule and the undermining of trade union rights including collective bargaining. At the same time the bosses continued to reward themselves with grotesque salaries and bonuses. In 2012 it would have taken a general worker in Implats 219 years to earn what the CEO earned, and in Lonmin it would have taken 194 years. What the bosses of course didn't bargain for was that their clumsy scrambling combined with greed was going to blow up in their faces, doing serious damage to all of us as a society in the process. We as a Federation, and the NUM itself have not been immune to this damage.

But we can analyse a situation until we are blue in the face. What is important is to find a constructive and united way forward to rebuild our collective power and our capacity to deliver to our members. This is why the message of the Amplats comrade who spoke at the NUM's Collective Bargaining Conference earlier this year was so critical. He talked of learning from mistakes, of identifying weaknesses, and most importantly of all, of getting in touch with workers.

It is also why the dignity of NUM President Comrade Senzeni Zokwana displayed at the Farlam Commission was so important. And it why the unity in action that is being displayed across the Federation in the North West, is absolutely critical. Clearly from the reports that we are getting from Rustenburg this approach of re-building is beginning to pay off, with significant numbers of workers returning home to the NUM.

Of course the road ahead is not going to be easy. But the work that we will be doing over the next four days will help put the building blocks in place for moving forward.

There are some critical challenges that the Federation faces in organising, collective bargaining, servicing and campaigning, which I would like to highlight. These are shared challenges faced by all of our affiliates.

Let me spell out some of the challenges, in the order in which we will be addressing some of these in the Conference: -

The first challenge is trade union membership and density

While the Federation has grown enormously over the years to reach 2.2 million members, we are still a long way off our 2015 target of 4 million members. South Africa has a trade union density rate of slightly over 30%. While this is not bad by international standards, it is still far too low. Trade union density of 30% means two out of every three workers are NOT organised! We have a huge task ahead as a Federation, especially amongst the most vulnerable and exploited workers.

But numbers are not the end of the story. Numbers do not necessarily translate into organised power. This is one of the dilemmas that the Commission into recruiting and organising later today will be looking at. In devising recruitment strategies we must make sure that the link with other union activities is not broken. Members must be educated and informed from day one. They must be made conscious of the very special emphasis that we place on accountable representation of the collective. They must understand from the moment that they sign a membership form that while the union does and MUST take up individual cases, it is not a complaints office. Power and responsibility lie in the collective.

Many of you are experimenting with new approaches to organising. Some of those experiences will be shared in a Commission later today. Some of these experiments include

• SACCAWU's Mall Committees which bring workers of small and big companies together.
• NUM paying special attention to recruiting migrant workers from outside of South Africa
• NEHAWU's establishment of a central Organising Service Centre
• NUMSA's strategy of employing dedicated ex-shop stewards on a stipend plus bonus basis, to work with organisers
• SACTWU's employment of growth organisers in each Province
• FAWU's use of the Occupational Safety and Health Act to get access to farm workers

There are some very innovative approaches out there. But we must find ongoing mechanisms for sharing these experiments and their outcomes - whether positive or negative.

The second challenge is service to our members

Our members have told us in the NALEDI Workers' Survey that the most important reason for joining a COSATU union was for protection against dismissal and unfair discipline (38% of our members), followed by improving wages, benefits and working conditions (33% of our members). The remaining 29% of members told us that they joined the union to change society (9%), or because of peer pressure or a closed shop (5%) or because of union benefits (3%).

This tells us that we have to put our efforts first and foremost into successfully defending workers in disciplinary cases and into wage bargaining. And yet the statistics we have from the CCMA show us that only 46% of cases referred by COSATU affiliates to arbitration were won in favour of workers. This REALLY is something we have to reflect on, and do something about. Are we losing cases because our shop stewards, organisers and paralegals, where they exist, are overloaded? Or are they poorly trained? Are they no longer preparing for cases? Are we taking up hopeless cases that are not winnable?

The truth is that while we have conducted plenty of surveys of members and shop stewards, both as the Federation and as individual affiliates, we have not done enough to find out what are the strengths and weaknesses of our organisers across the Federation. Apart from knowing that between them the Affiliates employ around 700 local and provincial organisers, we know very little about our organisers.

We can guess that by and large they feel unsupported and dumped into the deep end, but we don't REALLY know enough about their daily work to be able to know what the Federation should be doing to develop them. The input into the Commission on the role of shop stewards and organisers will probably suffer from the lack of information on organisers. But hopefully those of you who will participate in that Commission later today will start the process of sharing and gathering information.

Our members have indicated that they are reasonably happy with the way in which unions are taking up disciplinary cases, health and safety issues, retrenchments, racism, discrimination against women, and supporting people living with HIV and AIDS. But our members are NOT satisfied with the outcomes in a number of areas. While the numbers vary from union to union, no one escapes the criticism. The areas of criticism are: -

• Wage negotiations where only 40% of our members are satisfied across COSATU
• Skills development where only 51% of our members are satisfied
• Our support for temporary and casual workers, where half of our members are satisfied
• Our fight for better child care, where only 48% are satisfied
• And they've given us the real thumbs down on how we are taking up public transport, with only 31% of our members satisfied

What our members are telling us is in plain language is that we have to pull up our socks in all areas of service.

In revisiting our approach to organising and servicing, we must pay special attention to Building Unions in Small Towns.

Small towns, by the way, are where the majority of our organising presence exists (not in overall membership numbers but in numbers of locations). The vast majority of our 236 Locals are based in small towns. This will be the subject of discussion in a Commission this afternoon. We are really looking forward to the outcomes of this discussion, as it is one that we have never really had before. Hopefully many of you here today come from those small towns we are talking of.

We have a challenge, which relates to trade union representation and democracy

We had a lot of good news from the NALEDI survey of COSATU members but also a lot of not so good news. On the one hand it was encouraging to almost three quarters of members felt they could influence their shop stewards to act on their behalf, and that this proportion is higher amongst COSATU unions than non-COSATU unions. But that DOES mean that one out of every four member feels disempowered.

It is this disempowerment, combined with dissatisfaction with service that creates conditions for workers to follow opportunistic individuals. We have so much work to do to reverse the tide of tiny powerless unions springing up all over the place. There are presently 193 registered unions in South Africa, 117 of these do not belong to any of the existing four federations, with multiple unions mostly in the sectors that are the least organised such as catering, wholesale, hotel, cleaning, security, etc.

So we have to step up our shop stewards' education programmes. The most recent CEC adopted a framework for an education programme to be rolled out over the next year, which puts shop stewards training at the centre. But this can only happen if all affiliates buy into the process, and help to develop the necessary materials by pooling together their existing resources and expertise.

Another worrying indicator is that 35% of our members have told us that there has not been a shop stewards election in their workplace in the past four years (compared to 50% of non-COSATU unions). While the best performing union in this respect (SAMWU) had 80% compliance with 4 yearly elections, the worst performing COSATU affiliates, had slightly less than 50%. This non adherence to our unions' constitutions is a recipe for problems.

Which brings me to a point of digression - our union constitutions. How many of our national and provincial leaders really know and understand their constitutions? Over the past few years we have had some near disastrous situations where there have been serious differences within leadership over interpretation. More importantly how many ordinary members have a clue about their union's constitution? Do they know of the relatively easy steps that have to be followed to recall a shop steward, for example? If more members were familiar with critical aspects of their constitutions, we might see far fewer sit-ins at union offices, threats to office bearers, and mass resignations as a protest against certain shop stewards.

Perhaps the most serious indicator of a problem in systems of representation and democracy is that over one third of our members have told us that they have not attended a union meeting in the past year. Although the occurrence of general meetings is much higher for COSATU members than for members of other unions, this is still not good enough.

We should be having general meetings in ALL work places at least once a month. The general meeting lies at the heart of our mandating and report-back processes. These general meetings should not just take place during peak times, such as wage negotiations. They should take place on a consistent basis. There will ALWAYS be plenty to fill an agenda - whether its developments in skills, collective grievances, health and safety, or whatever.

But holding a general meeting only takes us half way to ensuring accountability. General meetings should NEVER be a one-way street of reporting by shop stewards. They must provide space for members to speak up and discuss. Our shop stewards are all too often messengers either for the union leadership or for management. This is quite the wrong way around. 

In finding ways of improving our levels of representation and democracy we could do well to establish an agreed checklist for all activities across the Federation. The checklist could look something like the checklist referred to in the NUM's main document to their recent Collective Bargaining Conference. The components of the checklist are: -

• Is the activity being conducted on lines that promote Internal Democracy?
• Does the activity promote Solidarity?
• Is Activism present?
• Is the activity steeped in Dialogue - that is not just a one-way street of communication from the top down?

Such a checklist could be applied to EVERY union and Federation activity - from wage bargaining, to the holding of general meetings, to engagements in consultative forums in the work place, and to meetings of all structures of the Federation and Affiliates. Only if we infuse all our activities with democratic practice can we claim to truly represent workers OR claim that we are worker controlled Federation.

The issue of democracy and accountability is a theme that will run through all of our Plenary and Commission discussions this week. In particular those of you who will be participating in the Commission on the role of shop stewards and organisers this afternoon, as well as those participating in the Commission Three on accountability in centralised wage bargaining tomorrow will need to come up with practical proposals of how we should enhance this principle which is a founding principle of COSATU and which has always distinguished us from most other unions in South Africa, and has made us respected throughout the world. We are now challenged to defend this organisational culture, which is under attack.

The Challenge of Social Distance

Linked to the issue of accountability is the issue of what we have called Social Distance. This refers to the distance of too many shop stewards and leaders from their base, as well as distance between the trade union movement and the most vulnerable and marginalised within the working class.

On the issue of the social distance of leaders, we have to acknowledge that even at the level of full time shop stewards, and even more so at the level of elected leadership, we have allowed a situation where a physical and material distance often exists. How often do we hear of full time shop stewards having absolutely no connection to their original constituency? Sometimes these are elected office bearers, who have not been re-elected by their constituency, and yet get protected by a fudging of their union constitution. Then there is often a material distance.

Sometimes in an effort to find a solution to the challenge of a full time shop steward being taken out of the normal pay and progression structure of a company, we have agreed to conditions, which provide undue privilege. This privilege becomes the source of envy as well as derision (disdain and scorn). Where it becomes the source of envy it produces leadership battles based not on principle but on material competition. Whether the response of workers is envy or derision, the ultimate product is the same - the creation of conditions ripe for splits and splinter unions.

We should also be very careful about the pay and benefits of our officials, including elected officials, and benefits of elected worker leaders or office bearers across the Federation and affiliates. We can never, and should never even try, to compete with salaries and conditions in business and government. We would be hypocritical if we were to reproduce the pay gaps that exist outside of our movement. The last thing we want in the Federation is a large layer of leadership with increasingly bourgeois interests, who will become unwilling to challenge the economic status quo because of their material conditions.

This means that our retention strategies need to place a much stronger emphasis on the job satisfaction of making a real contribution to the building of a strong movement, and the building of the political consciousness of our officials. Our officials need to be acknowledged and encouraged. They must be provided with proper supervision, mentoring, and training. We do too little of this. Worker control does not mean that our officials have to be bossed around or derided. On the issue of social distance from the poorest sections of the working class, our recruitment drive amongst the most vulnerable workers will be the first step in narrowing this gap. There should be absolutely no space left for the unfair allegation that we represent the working class "elite". The second step is to ensure that our local, provincial and national structures respond and link to the issues that are expressed on the ground. Quality service delivery is the most obvious issue. In this regard our Locals in many areas have been very responsive. In Section 6 of your files you will see a list of Locals and the issues that they were taking up in 2012. But we are not doing enough to link these local actions and initiatives to national campaigns and interventions.

We will all be looking to the Commission on Social Distance that is sitting later today to come up with recommendations for narrowing this gap.

Our next challenge is corruption

Corruption in our ranks is something that we don't really want to talk about. But our members have spoken through the NALEDI survey, and we have an obligation to tackle it. "Corruption" for our members can mean many things, from selling out to management without any financial exchange through to the abuse of union funds, creating privilege for leaders, and being bribed by management. How can we be seen to be a leader in society on this matter, unless we act decisively against corruption, as well as the perception of corruption, in our own ranks.

It is of huge concern that one third of our members across all affiliates allege that there is corruption in their union, and 12% say they have actually personally seen it. The highest allegations are in SATAWU and NUM, where 44% and 43% respectively report that they believe there is corruption. Now whether or not these statistics are a reflection of reality is not the point. If such high number of members THINK there is corruption, then we must be worried about trust. And we must leave no stone unturned to find out the truth in every instance where an allegation is made. We cannot be calling on government to take action against corruption and then sweep it under the carpet in our own house.

We must accept that where trust is low, relationships in the organisation, and the organisation itself, becomes unstable. Transparency in ALL matters of money in our affiliates is a must. While on the subject of corruption I want to take a short detour to talk a little bit about Corruption Watch. Corruption Watch is our baby. It was decided upon in the Central Executive Committee, and steps were taken to establish a Board and employ an Executive Director. It is a body independent of COSATU, but we have seats on the Board. In this sense it is not a subsidiary of COSATU, but it does see itself as being somewhat accountable to the Federation. For this reason Corruption Watch submitted a report to the 11th COSATU Congress last year. The broad mandate of the organisation is to help to create a climate of resistance to corruption, and to help shape policy on corruption. The three main activity areas of the organisation are: -

•  Data gathering and research - based largely on the vast numbers of reports that it receives on a daily basis
• Investigation - on a relatively small scale, and only into highly selected and strategic issues. Most reports that require investigation are handed on to the relevant investigating authorities, all of whom have been most cooperative
• Communication and stakeholder engagement

In the first five months of its existence Corruption Watch received 750 corruption reports. Almost all the complaints were against government departments, with the largest category relating to the category called procurement corruption. The second largest categories were general abuse of public resources by a public officials, and corruption relating to employment, including nepotism. These were closely followed by bribery, which accounted for 18% of reported corruption cases. The highest number of complaints emanated from Education departments.

Corruption Watch has received a handful of allegations against union leadership from members of affiliates. We should not be afraid of this. Where the complaints are fabricated or malicious the authorities will discover this very quickly. But where there is truth to the complaints we must accept that there will be consequences. Even if these consequences are embarrassing for us, we must pick up the pieces, tighten our own financial and other processes of accountability and transparency, and move on.

On Wednesday, Day Two of our Conference, we will start to talk about strategies for collective bargaining.

We will have a detailed overview in Plenary of our wage bargaining achievements. But we will also hear an analysis of how workers' share of profits has been declining. This is very scary.

We will have plenary inputs on the legal issues, which are interfering with the right to strike, as well as the challenge of violence in strikes.

Commissions, which will deal with the following, will follow these plenary inputs: -

Wage gaps

Not only does South Africa have the title of most unequal society i.e. between the richest and poorest, which we talked about in the beginning, but we also have other serious gaps to contend with.

We have a gap between minimum wages set by Sectoral Determinations, and those agreed on through collective bargaining. According to the LRS the average negotiated minimum wage for collective bargaining in 2011 across sectors was R3405 a month, whereas for Sectoral Determinations it was R2118.

In most sectors we have big gaps between the lowest paid in the bargaining unit and the highest paid in the bargaining unit

The trend of going for annual percentage increases across the board in recent years has increased these gaps, to the serious detriment of lower paid workers. It is time we consider strategies to close these gaps, including making across the board Rand demands, which are also easily understood by workers.

The issue of wage gaps will be addressed in Commission One on Day Two. The participants in this Commission have the huge task of coming up with practical steps to address the challenge.

The Commission looking into wage gaps will also discuss the challenge of Insufficient and fragmented centralised bargaining

The number of workers covered by bargaining council agreements has recently been declining, after significantly increasing from 1996 to 2004. Only 2.4 million of the workforce is covered by bargaining councils, and many of these councils are not national. More workers are covered by Sectoral Determinations than by bargaining council agreements i.e. 3.5 million workers.

There is also an ongoing battle with government to get bargaining council agreements to cover non-parties.

The coverage by sectoral bargaining, and Bargaining Councils varies from sector to sector, with NUM having the highest and SACCAWU the lowest. We all know that the absence of centralised bargaining in the platinum sector was a big contributing factor to the turmoil of 2012.

We therefore need to campaign for compulsory, wall to wall centralised bargaining in all of our sectors. But of course centralisation MUST be accompanied by the democratic processes that we spoke of earlier.

As we were preparing for this historic conference, the Free Market Foundation launched a High Court and Constitutional Court action against every Centralised Bargaining structure in the private sector, following on challenges by clothing and engineering employers.

To quote his own words in this affidavit, Herman Mashaba, the CEO FMF says amongst others:

"Section 32 of the LRA, which is at the heart of this constitutional challenge, empowers the parties to a bargaining council to impose legally-binding terms and conditions of employment on non-parties within its scope of jurisdiction provided certain preconditions are satisfied. A bargaining council can achieve this outcome by petitioning the Labour Minister to extend a collective agreement concluded under its auspices to non-parties within its scope of jurisdiction. The Minister has no discretion to refuse to heed the request, but is obliged by subs (2) to grant the extension if satisfied that the formal requirements of the section have been met".

This attempt to collapse collective bargaining is a declaration of a war against workers, who have fought since the Durban strikes for a labour relations framework which entrenches their right to bargain collectively at every level, from company, to sector, to the national level. The issues of centralised bargaining will be discussed in both Commissions One and Three on Day Two, and we need to come up with a clear mandate for the Federation to drive changes to the current voluntarist bargaining system, which allows employers, and the right wing, to constantly destabilise it.

Then there is the vexed problem of job grading and the terrible way in which the value of workers' labour is undermined. We will be addressing this in a Commission on Day Two, where we will be looking for you to come up with radical proposals to reverse the domination of the bosses over job evaluation systems. We also expect you to come up with ideas of how we can link the issue of grading organically to skills development.

Another Commission on Day Two will consider how the public sector unions (including municipalities) can better coordinate their collective bargaining efforts. The establishment of this Commission came about in response to a special request from the Public Sector unions. These unions should use the opportunity strategically and put in place improved processes going forward.

The question of Defending the Right to Strike, in the face of recent attempts to undermine this crucial power of organised workers, will be the subject of two plenary inputs and a Commission on Day Two. Discussion will include focusing on the problem of replacement or scab labour, problems around picketing, challenges in essential services, as well as the law around damages claims. The input and discussions will also deal with the thorny issue of violence in strikes. We have to make an honest assessment of the causes and effects of violence in strikes. An assessment of police violence during strikes, and the role of employers in fomenting conflict, must also be part of this discussion.

On Thursday, Day Three of our Conference, we will be focusing on the related issues of a National Minimum Wage, Decent Work, the Social Wage, and Social Protection

To start with low pay and minimum wages: -

The spotlight has been on low pay in the past year like no time before. While the minimum rate for farm workers has now been raised by 52% to R11.66 per hour (or R525 a week or R2274.82 a month) this is still way below a Living Wage. Independent research conducted by the University of Stellenbosch for the parties in the farm worker negotiations has shown that a family of 4 (2 adults and 2 children) needs to spend R2307.96 a month, just on food, if it is to have a reasonably balanced diet and a reasonable (though still insufficient) intake of energy. Instead, poor families are forced to live on a diet of maize porridge, bread, sugar, tea and milk in order to meet their other basic living costs. The research shows that even if the demand of R150 a day was met, workers would still be in poverty and unable to afford a balanced diet.

The recent increase in the minimum wage of farm workers brings it up to more or less the same level as the minima for wholesale and retail workers, taxi workers, hospitality workers, security workers and contract cleaning workers. However domestic workers have been left behind with a minimum wage of 20% less than this very low level- R8.95 an hour (or R402.96 a week) in the Metros and bigger towns, and R7.65 an hour in other areas.

All the low paid workers in these sectors earning less than R2300 per month are only earning about 60% of the minimum living level of around R4000, which various research institutions have estimated is required for families to afford the absolutely basic necessities. And they form the majority of South Africa's workers: Stats SA calculates that half of South African workers in 2011 were earning less than R3033 per month- way below this minimum living level. These are the working poor, who also have to support the unemployed, in the absence of social protection for them.

Even more alarming is that these ultra low wages are not only in unorganised sectors: very low wages prevail in some of the sectors where we have a strong presence such as clothing, textiles and leather. A clothing machinist in the rural towns such as in Newcastle earns R6, 52 an hour and R285, 00 after a 5 day 45 hour working week. This is scandalously way below the wage set by the Employment Conditions Commission for farm workers, domestic workers, wholesale, taxi, hospitality workers, etc.

We know that wages in some of your sectors are much higher than these very low levels, which is not to say that they are acceptable. They are not. But in our struggle to improve all workers' wages, we MUST pay special attention to the lowest paid. Fighting for decent pay for ALL workers is part of fighting poverty. Low pay is not helpful to an economy. As the research on food requirements shows, workers who are paid starvation wages do not buy. And if millions of workers have no purchasing power, then production suffers.

If production suffers, then jobs are not created. So we have to use our collective strength as a Federation to persuade our government that a radical shift in wage policy is needed. We have an excellent example to draw on in the form of Brazil, where a radical increase in the national minimum wage has played a key role in driving job creation (17 million jobs in ten years!). As President Lula told our CEC in December: "when the poor started spending, the giant wheels of the economy started to turn!" This is contrary to the argument peddled by conservative economists in all our newspapers.

The argument for a national minimum wage will be elaborated on in a detailed input on Day Three. The input will be complemented by an input from an official of the ILO, who has come all the way from Geneva to share some detailed research into national minimum wages in other countries. South Africa desperately needs a new incomes policy deliberately designed to drastically reduce record income inequalities, and address the phenomenon on a working poor. We do not subscribe to the goal of the National Planning Commission, that by 2030 South Africa will only have reduced its level of inequality, measured by the Gini coefficient from its current level of 0,69 to 0,6 or 60%. Such a feeble target would still make us the most unequal major country in the world!

A suggested strategy for advancing Decent Work will also be presented on Day Three. Decent work talks not only to wages, but also to the social wage, or social benefits. Government still has to address the elephant in the room: the lack of social protection for over 7 million unemployed.

A Living Wage and Decent Work is not sufficient to solve our problems of poverty. For even if the strategy starts to create more jobs, our levels of unemployment are so high as to warrant other interventions to alleviate poverty. The creation of a universal social security safety net is therefore critical.

The issues of a national minimum wage, an agenda for Decent Work, and social security are regarded as so critical that we have allocated these as the topic for discussion for ALL Commissions on Day Three. We want everyone at this Conference to engage directly with the subject.

Our final day, which is on Friday, will be a half-day of very intense discussion on our current campaigns.

We need to build bridges with other forums of organisation of the working class. The best way to do that is through campaigns. On the 8^th March 2013 was International Women's Day; we have to embark on a serious campaign in our communities to stop violence in general, particularly violence against women and children. This is no small matter comrades, we have to fight capitalism and its scourges by also engaging in campaigns that seek to ideologically develop the working class.

There is also the Israel Apartheid week, beginning on 11^th March 2013; we have to be active on this front comrades. We are a class-oriented anti-imperialist internationalist Federation. In this connection, we should applaud ourselves for taking leading and driving this campaign. NEHAWU will be distributing materials pertaining to the campaign. We should take this campaign to other structures of our broad movement and in communities in general.

Coming to this Conference comrades, the biggest focus will be on our Section 77 Socio Economic dispute. The CEC has consolidated a set of demands as per the 11th Congress's mandate. The demands are designed to trigger a serious engagement with our ANC government on some key socio economic issues. These include demands that relate to:

• The creation of decent work
• Eradication of poverty
• Seriousness in fighting the scourge of Income inequality
• A forty-hour week
• The banning of labour broking
• Full social protection
• Ownership and control of the economy
• Fundamental tax reforms and the transformation of our macroeconomic policy
• Land redistribution
• The nationalisation of the Reserve Bank and intervention in the currency markets
• Access to quality education and quality health care

The respondents in the dispute are the entire key government Ministries. Negotiations in Nedlac have not yet begun. Your input on Friday and your commitment to mobilisation around the demands is critical. Our actions must speak much louder than our words.

We have no choice but to push for a fundamental overhaul of our economy. We need a radical transformation that puts people at the centre. For the sake of our children, and our children's children, we cannot allow the status quo of high levels of poverty, unemployment and inequality to bedevil our existence. This stance is not oppositionist. It is true to the Freedom Charter and to the founding principles of both the ANC and our own Federation. We dare not fail in our duty to pressurise our political leaders to take bold steps- to engineer our own Lula moment!

What better way is there to honour the legacy of great Hugo Chavez, and other fighters for justice around the world? Fighters who are striving to overcome the legacy of neo-liberalism, and launch an offensive for a new world economy based on social justice, equity and redistribution of the wealth which workers produce. While we live in a capitalist society, and strive for socialism, workers won't wait for some future utopia to claim what is rightfully ours. Let this historic conference develop a powerful strategy to claim the social surplus- today and tomorrow! I wish you best of luck with your deliberations.

VIVA FREEDOM CHARTER VIVA!!

Amandla!

Footnotes:

[1] See Resolution 3.10.5 (4), COSATU 9^th Congress.

[2] Bhorat H. et.al. (2011): Minimum Wage Violations in South Africa. DPRU Research Paper. University of Cape Town.

[3] Commission on Employment Equity Report (2009-2010), p.30.

Issued by COSATU, March 12 2013

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