There has been much huffing and puffing about a government policy reversal on privatisation in the past two or three weeks. Based on our experience of the transport sector, the South African Transport and Allied Workers Union (Satawu) believes there has been a shift, but that it has less dramatic and more gradual than many commentators believe.
We date the start of the shift to just over two years ago when, after protests by and engagement with Satawu and other rail unions, the government reversed its decision to privatise the railways.
For the first time in restructuring state assets, the government engaged labour and management in a serious problem-solving exercise. The result was a shared view that the privatisation would shrink the rail network, drastically reduce volumes carried by rail and prompt massive job cuts.
The agreement reached revolved around a 20-year plan of investment, volume growth, network rehabilitation and efficiency gains through projects. Spoornet’s recent announcement of a R14-billion investment programme and an increase in volumes carried are in keeping with this plan.
None of the plans involve injections of state capital. As per the agreement, they will be paid for over time through revenues.
All this is good news for railway workers, Spoornet and the economy as a whole. But let it be remembered that none of it would happened if organised labour had allowed the government to press on with privatisation plans.
After the Spoornet agreement, the language of the African National Congress and the government started to change. Increasingly, President Thabo Mbeki, ministers and senior ANC officials talked of the importance of investment in basic infrastructure and the role of the parastatals in the economy. These sentiments were reflected in resolutions at the ANC’s 2003 conference and in its election manifesto.
To this extent, there has been an important shift, because it is a change in the big picture. But here comes the sting. There has been no real engagement on the social and economic role of the parastatals.
In transport, Satawu has been requesting engagement with the government for four years on Transnet’s role. The government has consistently argued that it cannot discuss Transnet’s “end-state vision” because it hasn’t worked it out itself.
This vacuum has provided space for the government and Transnet’s unaccountable bureaucrats to act as they please.
They have unilaterally corporatised Transwerk Foundries (whose new management promptly pushed the company into the red, resulting in the closure of three foundries); arranged a management buyout of Transnet Pharmacies; put the sale of Transnet Housing out to tender; called for bidders for the administration of the Transnet Pension Fund (and encouraged another management buyout); put the sale of the road passenger service Autopax out to tender; announced the sale of 51% of the road freight service Freightdynamics; and sold off Transwerk’s Perway.
All these actions violate the National Framework Agreement (NFA) on the restructuring of state assets. Not a single transaction has been signed off by the management-labour Transnet restructuring committee, established in terms of the NFA.
All are therefore the subject of current or potential industrial disputes — which could be pulled together into one major dispute, in line with a resolution of Satawu’s national congress last year.
The government will no doubt mount the defence that these businesses are “non-core”. But in a world where everybody who knows anything about transport is increasingly talking and doing “integrated logistics”, this makes no sense at all. It definitely makes no sense without an agreed vision for Transnet.
But the problems don’t simply relate to Transnet’s smaller business units. A showdown is looming over Minister of Transport Jeff Radebe’s recent announcements on the merger of Metrorail, Shosholoza Meyl and the South African Rail Commuter Corporation.
As part of the Spoornet agreement, the government, management and labour agreed to investigate a merger. A joint task team was appointed and met several times before the government halted its work pending the resolution of financial squabbles between Metrorail and the rail commuter corporation.
That was the last labour heard of the process until Radebe’s recent announcement. We believe the merger may have merit — but there may also be many unforeseen difficulties that should be explored before any decision is taken. Nowhere else in the world are long-distance and commuter passenger services run as one operation.
The three rail unions have called for an urgent meeting with Radebe, failing which we may have another dispute on our hands. If you hear that Satawu’s leadership has had to decamp to the offices of the National Economic Development and Labour Council, assume privatisation is not as dead as it might have appeared.
Jane Barrett is the South African Transport and Allied Workers Union’s policy research officer