COSATU Central Executive Committee Statement – 29 August 2019

The Congress of South African Trade Unions held a successful meeting of its Central Executive Committee, which was attended by the representatives of all its affiliated unions and provincial structures. The meeting confronted and analysed both our strengths and weaknesses in order to improve and adjust our strategies. These are the outcomes of the CEC meeting:


The meeting acknowledged that COSATU remains the biggest civil society formation and the biggest membership-based movement in the country and welcomed the facts that many affiliated unions continue to be vibrant, democratic and worker-controlled organisations. The following affiliated unions (NUM, SACTWU, POPCRU and SADTU will be convening their respective National Congresses in the coming months and we wish all of them well.

 This proves that COSATU unions still cherish the discipline and principles of democratic centralism and worker control that are the foundation of this federation. The CEC welcomed the progress that has been made to stabilise both SAMWU and SATAWU. While this is a work-in-progress, we are happy that internal democracy is being revived in these two important COSATU unions.

Retrenchments and the declining membership rate in the country remain our biggest problems as the labour movement in the country. The CEC has resolved to intensify our ongoing recruitment campaign in the build-up to next year’s planned Collective Bargaining Conference.

The meeting resolved that we need to do more to hold the private sector accountable. We plan to develop strategies to directly pressure the private sector and not just rely on using the state to discipline capital. The meeting endorsed and adopted the Section 77 Strike against retrenchments, initially organised by our affiliated union Sasbo. All COSATU affiliated unions will mobilise to ensure that the Sasbo banking sector strike on the 27th of September is successful. This will form part of a build-up to a National COSATU Strike on the 07th of October 2019.

On the IPP’s, the CEC resolved that we should work with NUM, using our Section 77 Notice to fight for the scrapping of the IPP’s and also approach our lawyers to get a legal opinion on the agreement signed by the government.

Our fight against retrenchments is continuing in all sectors including government. The government’s attitude towards the public service and the public servants, in particular, is very troubling. We reject the unilateralism that undermines the PSCBC by government and we send a message to all of our members in the public service to stand ready to fight against these voluntary austerity measures. 

We are also working with our affiliated unions to improve the safety of workers in  their places of work and this includes holding accountable the people involved in the Marikana killings. We will support and work closely with NUM for the preparation of workers rally in Marikana in October 2019, we will make sure that the President of the ANC and  of the country will visit the Marikana workers and surrounding communities.

COSATU demands the following on Marikana:

·         Reinvestigate the killing of all workers in Marikana

·         Investigate the payment of all affected families which must include the first 10 killed people before police killed 34 workers.

·         Investigate the relationship between Amcu and Lonmin management, including the Marikina trust fund.

·         The Police minister must demand all cases opened against the killing of other workers after the Marikina tragedy

·         The Minister of labour must make sure that the constitution of our country is respected, and workers are allowed to join unions of their choice without intimidation

The CEC also instructed all affiliates and structures of the federation to work to improve the level of our cooperation with other trade union federations. We shall implement our congress resolution to build bridges and making sure that we build cordial relations with other federations as part of our campaign to unite the workers and the working class.

We have noted the Commission for Employment Equity’s 19th annual report, which showed that white people continue to dominate the economy. This is not surprising because companies have no reason to comply with the employment equity laws that are not being enforced.

The penalties that have been imposed on them are ridiculous.  The government itself continues to do business with the very same companies; giving them no reason to comply. This lack of political will and decisive leadership has emboldened these employers and many of them are openly defying and even vilifying Employment Equity laws instead of complying.

This is is also a reminder to all trade unions that labour laws never work primarily through government inspections, but rather through union monitoring and action. Recruiting workers and working together means that we can better force employers to comply with labour laws, especially in the vulnerable sectors of the economy.

The CEC has noted that Multichoice South Africa in its annual results at the Johannesburg Stock Exchange for the year ended in March 2019 made a 6% increase in revenue to R50.1 billion, with a 12% increase in its subscriber base to 15.1 million. These results were achieved through the sweat of workers in that company As COSATU and CWU, we expected that such gains would be shared with workers. However, the company has announced a plan to retrench 2194 jobs. Whilst noting that the Communication Workers Union, a COSATU affiliate, is leading discussions to avoid forceful retrenchments and improve the Severance Packages that have already been offered to workers who opted out. We further support a call by CWU for the company to upskill and reskill workers in that environment with SAQA accredited courses. If Multichoice fails to listen to CWU, as COSATU we will support a call of action by CWU, including a call for the boycott of Multichoice.


The CEC expressed its deep concern about the prolonged stagnation of the South African economy and the worsening rate of our unemployment. This economic stagnation will complicate the task of medium-term repayment of our public debt, some of which is denominated in US Dollars or other foreign currencies.

It is worrying that the governance of most of the State-Owned Enterprises (SOEs) continues to deteriorate, as we now regularly witness the disturbing reports SOE’s failing to pay worker’s salaries.

While we believe that the talk of an IMF bailout is overstated, we are clear though that such a development will actually undermine our national self-determination and threaten the course of the NDR. The country is now more vulnerable to the policy dictates of these western institutions and monopoly capital unless drastic interventions are taken to place the economy on a sustainable path of industrialisation and decent job-creation

On prescribed assets policy

The Federation reiterates its position to support in principle the idea a prescribed assets policy. Historically, the federation has always supported such progressive investments as they help the state to invest in public goods and infrastructure.  These public services form a key component of workers’ social wage e.g. free public health care for pregnant women, free tertiary education for the poor, lower municipal tariffs for indigent households etc. The PIC has often invested in government bonds on behalf of the GEPF, UIF and COIDA. 

The current financialisation orientation of our monopoly retail banks, as well as the risks placed on the workers’ savings in provident funds, is a reminder that all is not well in the private sector. There is an argument to be made for investing in strategic SOE’s like the proposed State Bank and other well managed and corrupt-free SOE’s.

Our banking oligopoly centralises capital flow within the economy, in which instead of lending for productive investments, they increasingly have a strong orientation towards heavy leveraging – in the toxic speculative derivatives – rather than supporting emerging value-creating rural and township activities.

A decade ago, the world-wide great capitalist crisis bears out the folly of this extreme form of financialisation – private banks leveraging in factious capital – in which in some instances others even lent out about thirty times on the amount they have in deposits. In the current financialisation phase of global capitalism, the heavy orientation of the private banks in this remains a stalking threat that would end-up in the too-big-to-fail scenario. Workers’ retirement insurance have been and are still exposed to such risks.

COSATU argues that provident funds could sustainably hold bond securities in the state-bank that would reliably hedge workers’ savings against inflation and economic recession – without the overweening drive for impossible rates of returns and fees to assets managers.

Instead, some provident funds are captive to unscrupulous assets managers, who like our banking oligarchy, would rather deploy large chunks of the depositors’ monies in betting on market movements of some stocks, bonds or currencies (including against the Rand).

Of course, those of our members who have provident funds legitimately expect good returns from investments for the sake of their own future social security when retrenched or pensioned. But not only the provident funds but also some assets managers do not exercise the required fiduciary vigilance – which is why there have been numerous incidents of disastrous outcomes, including the recent Steinhoff saga (with public service workers’ money in GEPF through PIC).                              

COSATU makes a distinction between bailing out SOE’s and investing in them. We expect worker’s pensions to be invested in areas where they will bring returns and currently the SOE’s as they stand do not inspire confidence and it will be reckless to allow them to be bailed out with workers money. Workers pensions are not a substitute for good governance. If the government wants to engage with workers on this subject there are many conditions that it needs to fulfil before workers can open talks.The government keeps saying that we have an economic crisis, it’s about time they act like it. We demand the following before we can even introduce this topic to workers:

·        All managers, businesspersons and politicians who looted from Eskom, other SOEs, including Steinhoff must be charged, prosecuted and if found guilty sent to prison. 

·      The stolen funds from Eskom, other SOEs, the state, including Steinhoff must be confiscated and returned to the state. 

o   We welcome the initial R2 billion returned to Eskom and Prasa.  But this is only the tip of the iceberg.

·        There must be no retrenchment of workers in the SOEs or the state.

·        Stop recycling SOE managers; cut their wages and bonuses.

·        Make SOE’s more transparent and efficient.

·         There must be a social compact which will see the rich paying their fair share and the poor protected.

o   Adjust corporate tax and make sure that indigent households are exempt from paying VAT on essential amounts of water and electricity. 

On the Treasury’s Draft Economic Recovery Strategy

In principle, COSATU is open to all proposals from all quarters (government and society) about how to address our economic crisis, in particular, our rising levels of unemployment.But we have some questions about this Draft Economic Recovery Strategy document. 

What is the status of this document? Why release a document to the public before it has gone to Cabinet? Who will be responsible for it? What if it is divergent to existing policies?

There are some seriously worrying aspects on what this strategy proposes.

·       The document ventures in the domain of other departments and at the same time it does not offer any proposed real changes to fiscal, monetary or other macro-economic policy, including inflation targeting. In several other areas, including on development financing and competition, it makes proposals on the IDC and the Competition Commission, which do not fall under its domain.

·       The document pretends that the Job Summit and Investment discussions never took place by talking  about a new compact between Government, Labour and Business. Treasury was unwilling to discuss changes to macro-economic issues in these summits; so how do they plan to  reach a social compact when they have subjects that are off-limits?

·         The Strategy document says nothing about the National Treasury’s failure  to complete the export tax policy and law and the Public Procurement Bill. For years, we have been told there’s progress but there has been no urgency. Both these interventions can make a significant change to the economy, including in specific sectors with linkages to many other parts of the economy

·         Several of their proposals on increasing competition are part of the new Competition Amendment Act, recently signed by the President or recent market enquiries by the Competition Commission, e.g. on grocery store leases, so there is nothing new there.

·         It regards ‘inflexible labour markets’ as an impediment to small businesses growing, along with regulatory burdens and red tape. Therefore, it proposes that the government considers full or partial exemptions for small business from certain kinds of regulation including the extension of bargaining council agreements.

·         It proposes exemptions for small companies, from bargaining council/wage regulations. This is a major attack on our bargaining council collective bargaining system. (Here the National Treasury is regurgitating and resuscitating the failed position of the Free Market Foundation)

·         It also suggests exemptions for SMMEs from the NMW, despite this law being new and its impact not having been shown as problematic and despite government, including Treasury representatives, agreeing to the current form of the NMW at Nedlac. This can only create policy uncertainty and make government an unreliable partner.

·         This the strategy goes against ANC policy and the President’s commitments not to privatise Eskom.  Treasury proposes to privatise Eskom through the back door by calling for the auctioning off of its coal plants. 

·         The strategy acknowledges the fuel price regime is stifling economic growth but fails to say what the government should do about it. What happened to the research commissioned by the government on a Fuel Price Cap that was supposed to be finalised earlier this year- January 2019.

·         The biggest threat to the economy is the pending collapse of the SOEs, the burgeoning levels of corruption, the loss of R150 billion a year to corruption and wasteful expenditure and declining tax revenues.  Government’s single biggest task is to address these. The strategy talks only about Eskom but fails to provide concrete plans to stabilise, save and grow the many SOEs on the verge of collapse. It talks about transport but is silent on the collapse of PRASA and how it prevents workers from getting to work on time.

On the Industrial and trade policy section

·         This section does not contain very strong proposals and is not substantive enough to fix manufacturing. The other problem with this section is Treasury’s meddling in micro-economic policies and the work of other Departments

·         It emphasises public procurement as a tool to support industrialisation and proposes several steps to strengthen this, including getting more information on government spending and buying, and compliance with designations

·         Treasury should conclude all processes with the new and long-outstanding Public Procurement Bill, including taking it to Nedlac for consultation and agreement, and ensure it strongly supports local procurement to make sure public procurement further supports industrialisation

·         Its understanding and analysis of (International Trade and Administration Commission) ITAC is worrying. It suggests ITAC deals with matters on a case-by-case basis, when ITAC is governed by government broader economic policies, including the (New Growth Path)NGP, but more specifically the trade policy

·         One of the glaring gaps in its industrial policy section is customs fraud – an area that Treasury is responsible for and which has largely not been addressed. Steps to fix this and to support industrialisation should be part of any strategy

This Draft Recovery Strategy makes the government appear incoherent, confused and unreliable. COSATU rejects it and demand that National Treasury withdraws this document immediately.

On the ANC

The CEC expressed concern about the ongoing political killings in Limpopo and KZN and is calling on the law enforcement agencies to do their work. The Federation is worried by the ongoing factionalism in the ANC and call on the leadership to focus on a programme of action to rebuild the ANC, restore unity and cohesion within the movement in order to build confidence and hope amongst the masses of our people.

Leaders need to stop the unconstructive public attacks on each other because they are not helping. South Africans are crying for leadership and not political theatre. The CEC has noted the attempts to scandalise the concept of fundraising by the CR17 Campaign in the build-up to the Conference. This is nothing new; fundraising sometimes means getting funding from our class enemies.

While most of this is driven by political opportunism, the CEC agrees that the ANC does need to confront the culture of money and vote-buying in its Conferences at all levels. People are right to be worried about the possibility of influence peddling by the funders as we saw with the Guptas.This is destroying the moral fibre and the political discipline of the entire movement. It’s an unsustainable and toxic political culture.

On the Public Protector, the CEC is concerned by the political stench coming out of that office and we have the same opinion with those who say the office is deteriorating and unfocused. We call on all affected parties to use legal processes to challenge its findings if they have any objections and for the National Parliament to play its oversight role without fear or favour in protecting the integrity of that strategic institution of our democracy.

On the Alliance

 The CEC has acknowledged Cde Cyril Ramaphosa’s efforts to unite the Alliance as a leader of both the ANC and government. The comprehensive consultation over cabinet appointments have been followed by his steady implementation of some Alliance endorsed ANC policies. Despite the recent political gridlock and commotion, we have already seen a gradual progressive policy shift in the economic policies by the ANC’s sixth administration:

·         Introduction of the National Minimum Wage.

·         Implementation of Free Education

·         the release of the NHI Bill

·         The exploration of the introduction of a State Bank.

·         Commitment to the Amendment of Section 25 of the Constitution

·         The signing of the Debt Relief Bill

This commitment to the progressive resolutions of the 54th National Conference is welcomed although some within the ANC and National Treasury are trying to exploit the current economic crisis to push their rightwing agenda.

COSATU will defend the progressive resolutions of the ANC and will continue to be a constructive partner of the sixth ANC administration on policy questions, as long as it delivers on the Manifesto commitments and sticks to ANC policies. Any attempts to abandon ANC and Alliance policies will antagonise the workers and they will be amongst the most formidable adversaries of the administration.

The Federation wants to see the Alliance and government at all levels intensifying the war against unemployment, poverty and inequality. Unless we deal with the problems honestly and urgently, the Alliance will likely face, not reduced participation and support in the elections, but rather the on-going protest action, political divisions, demobilisation and alienation, with potentially devastating consequences for our longer-term aims.

We are unhappy, though, with Luthuli House’s failure to convene Alliance meetings consistently. We demand an Alliance Political meeting in the next two months so that we can debate the possibility of an Alliance Economic Summit to deal with the crisis.

Issued by COSATU
Sizwe Pamla (Cosatu National Spokesperson)

Tel: 011 339 4911
Fax: 011 339 5080