The mandate of the South African Reserve Bank should be changed, the Federation of Unions of South Africa (Fedusa) said on Tuesday.
The reasons for the change would be to focus on creating decent work and improving economic growth as well as creating a competitive exchange rate, Fedusa’s general secretary Dennis George said in a statement.
”Many central banks across the globe no longer consider employment creation as part of their mandate.
”Yet limiting monetary policy solely to price stabilisation cannot guarantee that economic growth will improve since low inflation does not necessarily lead to high and stable economic growth,” he said.
He added that it was vital for Fedusa to place employment at the centre of economic and social policies.
”Nobody wants rampant inflation but there is a case to be made to balance the effect on employment with interest rate cuts.”
George said the strong rand was choking South Africa’s exports, which had resulted in massive unemployment in local manufacturing industries.
Turning to industrial policy, George added that South Africa now had the opportunity to implement a policy that emphasised manufacturing and services.
”The manufacturing and services sectors can play an important part of placing our economy on a growth path to create quality employment for all.”
These sectors included capital-transport equipment manufacturing, beneficiation of metals and raw materials, automotive and components sectors; chemicals, plastics, pharmaceuticals, forestry, pulp, printing, paper, leather, footwear, clothing, textiles and furniture.
George said the manufacturing sectors had proved to be very labour intensive.
He added that government should provide more support for the creation of ”green jobs” so as to make provision for one million solar water heaters by 2014.
Fedusa also believed that the role of state owned enterprises, public utilities and development finance institutions should be evaluated by the National Planning Commission and the Monitoring and Evaluation Commission.
The purpose of the evaluation would be to ensure that these organisations’ strategic priorities were focused on the creation of decent work as well as the country’s development goals.
”There has been a tendency for these boards to focus more on corporatisation instead of decent employment opportunities that have been destroyed by the encouragement of practices such as outsourcing, subcontracting and casualisation to support black economic empowerment.”
George said Fedusa supported the call made by President Jacob Zuma in his first State of the Nation aAddress that decent work should be at the core of the country’s investment and economic policies. — Sapa