/ 10 February 2007

Mbeki fails on economic deficiencies, says Cosatu

President Thabo Mbeki failed to announce a development strategy to address the economy's inherited structural deficiencies in his State of the Nation address on Friday, said the Congress of South African Trade Unions (Cosatu). This affects the country's ability to address unemployment, poverty, inequalities and the social ills related to these.

President Thabo Mbeki failed to announce a development strategy to address the economy’s inherited structural deficiencies in his State of the Nation address on Friday, said the Congress of South African Trade Unions (Cosatu).

”As the consequence of this failure, South Africa will take a lot more time to address its unemployment, poverty, inequalities and the social ills related to this, such as HIV and Aids, moral degeneration and crime,” Cosatu said in a statement.

However, it praised the framework of industrial policy that was announced.

”A spirit of acknowledging the challenges we face and failures of government and a range of intervention measurers were announced. This heralds a new hope that we are en route to a real new age of consensus building.”

Cosatu remains concerned about the unresolved contradiction between the government’s commitment to a state-driven developmental industrial policy and its conservative, market-driven macro-economic and fiscal strategy.

It said the 1,5-million new jobs created in the past three years are not enough to help halve unemployment by 2015.

”Most of the jobs created are low-quality jobs — casual and unsustainable forms of employment, concentrated in some of the most vulnerable sectors of the economy — wholesale and retail, construction and agriculture.

”This means we are not addressing the challenge of poverty eradication and income inequalities that are so rife in South Africa.”

Wage subsidy

Cosatu totally opposes the idea of a partial ”wage subsidy for low-wage employees”.

”[It would] reward employers who underpay their workers and encourage them to get rid of these young workers as soon as the subsidy expires, or be used to displace older workers while doing very little to create quality jobs that will help the country eradicate poverty.”

Cosatu regrets that the government is still failing to respond clearly to the demand for a basic income grant.

Although welcoming Mbeki’s commitment to intensify the campaign against HIV and Aids, Cosatu feels the topic has still not been given sufficient priority.

”It is a huge national crisis, but was not included in the president’s list of features of South African life that are ‘ugly and repulsive’, and is given far less space in the speech than crime.”

On land reform, Cosatu said it welcomes Mbeki’s pledge to speed up land distribution, but will insist on far more radical steps to meet targets.

”Generally we share the president’s concern at the lack of capacity in all spheres of government. We urge the president to use more his prerogative to employ and fire ministers to ensure that he, in the most unfactionalist fashion, deals with non-performers.”

Cosatu expressed disappointment that Mbeki did not endorse the remarks of Agriculture and Land Affairs Minister Lulu Xingwana about the ”inhumane treatment and abuse of farm workers”.

”As far as we are concerned, this is a ticking bomb. The estimated one million farm workers will one day rise up against their daily abuse by the majority of the racist white farmers.

”When this happens, Cosatu shall stand firmly on the side of those whose abuse is not prioritised enough by the society.” — Sapa