/ 31 July 2009

Municipal workers call off strike

The five-day strike by South Africa’s municipal workers is over, the South African Municipal Workers’ Union (Samwu) and the Independent Municipal and Allied Trade Union (Imatu) said on Friday.

”It’s over … we signed an agreement this [Friday] afternoon,” Samwu general secretary Mthandeki Nhlapo said.

”Our workers will return to their posts on Monday,” he said.

The union agreed to a revised offer from the South African Local Government Association (Salga) of a 13% wage hike, he said.

Samwu’s members had initially demanded a 15% increase.

Imatu’s regional manager, Shadow Shongwe, said his union had also signed the wage agreement.

”The wage dispute has finally been resolved and the agreement that is now in place has been endorsed by the unions.”

He said Imatu members would return to work on Monday at about 11 am.

”By then we would have reached every corner of Imatu to convey the terms of the settlement,” Shongwe said.

The strike left rubbish piled up on streets and licensing offices closed.

Pressure on the government has also come from poor township residents, who have demonstrated to back their demands for better living conditions for millions of black South Africans who still lack adequate housing, electricity and water 15 years after the end of apartheid.

A double-digit pay settlement could put added strain on the economy, which fell into South Africa’s first recession since 1992 because of reduced local and global demand.

Analysts said above-inflation increases, such as the one won by Samwu and Imatu, could compound the impact of a 31,3% increase in electricity prices granted to Eskom last month and push inflation higher.

”We believe such wage growth and the Eskom tariff increases will keep core inflation high over the next year,” said Peter Attard Montalto, emerging markets economist at Nomura International.

Union power
The wage increase won by the municipal workers is a boost for the unions, which helped the African National Congress win the general election in April and have been using their power to try to push government policy in a more populist direction.

Investors, on the other hand, are keen for the government to stick to what they see as the sound economic policies that have helped shield South Africa from the worst of the global downturn.

The government welcomed the deal ending the labour action.

”As national government we are very happy and excited that finally agreement has been reached between the parties,” Cooperative Governance Minister Sicelo Shiceka said.

Samwu president Petros Mashishi said the union had no option but to strike. ”We were forced into a situation of going to strike because the demands that we put on the table could not be met by employers”.

President Jacob Zuma has warned against unlawful action from strikers and protesters.

”There is something wrong in our society if there are people … who think that it is acceptable in a democracy to stone cars, loot shops and burn people’s houses,” Zuma said in a weekly newsletter on Friday.

”We should nevertheless see these events as a challenge to work harder and more effectively to respond to the needs of our people.”

The ANC’s labour union allies say the poor have borne the brunt of the recession, and note official data shows unemployment has risen to more than four million. — Sapa, Reuters