Minister: Job cuts at mines unavoidable

South African Minister of Minerals and Energy Buyelwa Sonjica has confirmed that job losses at South African mines are unavoidable, the South African Broadcasting Corporation reported on Friday.

Sonjica said this became apparent at Thursday’s meeting with labour unions and the Chamber of Mines, but she would not disclose the number of job losses that will take place.

The urgent meeting was called after some mining companies warned that the country’s power restrictions could force them to shed thousands of jobs.

Besides the Sonjica, the minister of trade and industry and state-owned power utility Eskom were invited to the meeting, along with the trade unions and the Chamber of Mines.

The meeting was expected to focus on the general impact that the electricity cuts were having on mining, rather than the number of jobs that would be cut as a result of the scale-backs.

Mining companies across the country were forced to shut down for five days last month due to a shortage of power supply.

Eskom has since asked all its large industrial clients, including mines and smelters, to cut energy consumption by 10% because of power shortages in the country.

The utility has suggested that companies will have to live with these restrictions until 2012, when it brings additional generation on stream.

Gold, platinum and ferrochrome miners have been the hardest hit, with most advising that production forecasts for the year were unlikely to be met.

Earlier this week, South Africa’s second-largest gold producer, Gold Fields, said 6 900 jobs were at risk as a result of the electricity restrictions.

While AngloGold Ashanti, the country’s largest gold producer, said there were no immediate plans to close shafts or cut jobs, smaller rival Harmony Gold Mining has already invited employees to consider voluntary retrenchment packages in light of the power cuts.

Trade union Solidarity has estimated that South Africa’s power crisis could result in more than 15 000 job losses while Efficient Group chief economist Dawie Roodt estimates that the number could be as high as 60 000 to 80 000.

Earlier this week, the African National Congress called on big mining houses not to use the current electricity crisis as a reason for their administrative problems.

In a statement issued after its national working committee (NWC) meeting, the ruling party said mining houses should continue to assist in addressing the electricity challenges facing the country.

The NWC said companies should not use the electricity supply challenges as an excuse for problems that actually arise out of their own operational inefficiencies.

It said it wants mining companies to cooperate with the government on measures to conserve energy and safeguard jobs. — I-Net Bridge

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