General strike by Cosatu in October seems more likely

Labour unrest could become part of the price the South African economy might have to pay for the unfolding battle within the ranks of the country’s governing alliance. Unless relations between the Congress of SA Trade Unions (Cosatu) and its ally, the African National Congress (ANC) as leader of the ruling alliance, improve dramatically in the immediate to near future, the country could face a crippling general strike by October of this year.

Cosatu, in an attack on the Budget speech, accused the government of “talking left and walking right”.

The trade union federation threatened that it would call a general strike before October if the government did not take steps to improve workers’ rights, especially those who are only temporarily employed through labour brokers. It also specifically targeted foreign companies employing temporary labour.

However, much more than just these issues are at stake and will ultimately inform the decision to strike or not.

Tensions within the ruling alliance make its itchy appearance look like chicken pox all over the South African body of politics at the moment, as is reflected in other reports in this bulletin.

Cosatu and some of its affiliate unions find themselves as the major players in the escalating battle for political and economic control between the left and the centre nationalists within the ANC-led Alliance. Just how that battle pans out during the rest of the year, could have a decisive influence on the mood for strike action come October.

After President Jacob Zuma’s attempt in his State of the Nation Address to hide the government’s failure to create 500 000 jobs as promised in his election campaign last year, behind some 480 000 very short-term and basic work opportunities under the Expanded Public Works Programme, Cosatu angrily demanded an explanation on how his government will address the nearly one million jobs lost in last year’s recession, and how it plans to create millions of promised jobs over the next few years. To date, no explanation has been forthcoming.

One of the few positives from Zuma’s address was the promotion of youth employment and development. With unemployment among the youth being substantially higher than the national average, Zuma’s announcement of government interventions in the form of subsidies to encourage the employment of young people by companies was most welcome.

He also promised to speed up the establishment of the National Youth Development Agency.

In the subsequent Budget speech, Finance Minister Pravin Gordhan gave details of the wage subsidy scheme to encourage companies to hire youth, labeling the position of the youth as “a serious challenge”.

Government’s preliminary estimate is that about 800 000 people will qualify for these subsidies, while its aim is to increase the employment of school-leavers by 500 000 by 2013.

When announcing the strike threat, Cosatu’s general secretary Zwelinzima Vavi also welcomed a letter Gordhan said he had sent to Reserve Bank Governor Gill Marcus which calls for the Reserve Bank to widen the focus of its mandate to include job creation. However, Cosatu had been angered anew that Gordhan and the Bank are sticking to the policy of inflation targeting and Vavi again repeated that the unions want it scrapped.

Other issues in Zuma’s speech and Gordhan’s Budget have also renewed tensions between Cosatu and the SACP, and the ANC centre. Among these are perceptions on the left that the government is again proceeding with some privatisation initiatives, this time relating particularly to Eskom and energy provision.

Meanwhile, leaders of a number of Cosatu-affiliated unions have said the Zuma government has not delivered on its promises to trade unions and that Cosatu has been “taken for a ride”.

The battle lines seem to have been drawn and often cited as the best-organised, best-funded and numerically biggest organisation in the Alliance, Cosatu may also be keen to assess its own strength through the response to a call to a general strike. It would come at a time when tensions are rising and there is increasing talk of an Alliance split or the left being cut out of the Alliance. It could well be used as a muscle-flexing exercise aimed at the ANC and those who oppose the left. (For full report, click here)