Unions put Cosatu in financial fix

Labour federation Cosatu is facing a financial deficit of R1.2-million, owed in part to the failure of a number of its affiliates to pay their membership fees.

Financial documents submitted to Cosatu's central executive committee meeting this week and seen by the Mail & Guardian show that Cosatu affiliates owe more than R7-million in political and election levies. Cosatu uses these funds to do political work including campaigning for the ANC.

Cosatu president Sdumo Dlamini confirmed on Thursday that the federation was now in the red.

"Our unions are really struggling, particularly the big ones like the National Union of Mineworkers [NUM], because it lost a huge number of members [to the Association of Construction and Mine Workers Union] and funded a number of strikes in the last few months," said Dlamini.

Although Dlamini refused to discuss figures, documents seen by the M&G show that the NUM failed to pay its R827 242.69 monthly fees to Cosatu last month. Other unions that owe membership fees include the Food and Allied Workers Union (R1.27-million), the South African Municipal Workers Union (R400 570), the National Union of Metalworkers of South Africa (R1.8-million) and the South African Commercial, Catering and Allied Workers Union (R541 000).

Dlamini said the dire financial situation has affected some of the federation's campaigning this year. He has previously cited financial difficulties as the main reason why he was unable to organise a special congress requested by eight Cosatu unions to discuss the suspension of his nemesis and the federation's general secretary, Zwelinzima Vavi.

But the anti-Dlamini faction has dismissed this argument, saying all Cosatu national conferences were sponsored by business.

Last year Cosatu received a total income of R86-million from membership fees – R83-million was used for operational matters. Staff salaries alone amounted to R33-million, and R4-million was used to sponsor strikes. R2-million was for central executive committee meetings and national office bearers meetings.

Cosatu treasurer Freda Oosthuysen confirmed that the federation was facing financial difficulties, but refused to discuss the matter further. In her report, submitted to the central executive committee this week, Oosthuysen raised concerns about unions that were running behind with their subscriptions, as well as political and elections levies. An election levy was supposed to have been paid by all affiliates by November last year.

Meanwhile, Cosatu think-tank the National Labour and Economic Development Institute is struggling to raise the R2.6-million it owes to the South African Revenue Service, with its liabilities reportedly exceeding R5-million.


Last year, the financial services board stripped Cosatu's investment arm, Kopano Ke Matla, of its licence to manage pension funds after an investigation prompted by allegations of fraud and corruption. – Additional reporting by Mmanaledi Mataboge

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