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South Africa

January 29, 2014

National Economic Development and Labour Council (NEDLAC)

Executive Director addresses MEIBC conference

As we reflect on twenty years of democracy, the role and relevance of social dialogue , and the challenges facing the SA labour market have come strongly to the fore.  


The passing of Madiba marks the end of an era and has forced the nation to pause and reflect on our last twenty years of travel along a path of democracy. The socio economic challenges we face are enormous. It will require Madiba leadership values and inspiration to address these – values of bold, frank, visionary and, wise and conciliatory leadership.


South Africa’s post-Apartheid labour relations framework and its family of institutions which includes Nedlac, Bargaining Councils, the CCMA and the SETAS were all established in the context of the struggle for democracy, participation and giving social partners voice. This time was inspired by a deep grasp of the importance of social dialogue and of the merit in seeking consensus and win-win solutions.  A commitment to move away from the highly conflictual relationships under Apartheid towards social partnership.


These institutions occupy a highly charged but unique space between labour business and government. These were envisaged as spaces for negotiation, consultation, information-sharing, joint problem-solving and cooperation. They are also institutions that act like shock absorbers, soaking up the necessary conflict generated in a country marked by high levels of unemployment, inequality, and poverty, where extreme destitution even of those who have jobs, goes hand in hand with extreme excess and wealth.

These institutions are now under pressure to find simple formulas for employment creation.


The Current state of Social Dialogue in SA –

The current state of Social Dialogue whether reflected in Nedlac, the Bargaining Councils and the Setas is definitely not what we envisaged when we started our democratic journey almost twenty years ago.

The drivers and underlying causes of the instability in the South African labour market are complex. The drivers of unemployment and South Africa are equally complex. However there is view which is prevalent in some quarters which attribute the current upheavals in our labour market to the nature of our labour relations legal framework and institutional arrangements


But I would argue that many of our recent upheavals have less to do with the specific design of this or that law or institution and more to do with the capacity, conduct and commitment of the social actors involved.


This is a more intractable challenge, for the future of social dialogue, tripartism and collective bargaining. It calls for strong leadership and a paradigm shift away from the culture of adversarialism and a greater focus on build relationships and network of trust  and collaboration rather than just legislative  intervention and institutional redesign


As a start it requires a deeper appreciation and a more open and frank conversation about the underlying causes of the apparent failures we are currently witnessing. This conversation must be less ideological, less fundamentalist and orthodox and more pragmatic and evidence based. It also helps to look at our situation from a broader international context  


In times of crisis it appear that many governments prefer to take the political risk of going it alone rather than engage in genuine dialogue. But the evidence shows that this is a short sighted view. Interestingly enough the IMF now recognises the significance of social dialogue and social compacting.


The ideal preconditions for successful social dialogue includes a willing government that is committed to engaging social partners in a meaningful way.  It also requires social partners who are strongly organised, competent and committed to engaging in consensus-seeking forms of engagement and integrative bargaining.  And of course it requires well-resourced and well-managed institutions to administer and support the processes of engagement. Needless to say on many of these counts we fall far short.


Presently it seems that the social partners are incapable or unwilling to make the types of changes that are required to ensure more effective forms of social dialogue. Trust is practically non-existent,  while  the willingness to listen and develop a shared understanding  of  our socio-economic dilemmas appear an ever diminishing prospect. 


Another very worrying trend is the organisational weakening and fragmentation within the labour and business constituencies on the one hand and on the other hand the lack of effective implementation and coordination within government ,

The net effect is that Social Dialogue is severely weakened. It is therefore extremely unfortunate that precisely when we need social dialogue the role and relevance of  our institutions are under siege and rendered incapable of responding to the scale and urgency of the challenges at hand. 


When we celebrated the dawn of democracy, many of us understood that our socio-economic legacy – as manifested in deep structural unemployment, extreme inequality, high levels of poverty and serious backlogs in social goods and services -- would require a massive collective effort. We were filled with a sense of optimism and vision. As a nation we committed ourselves to tripartism and social dialogue as the main way for governing our labour market and our economy and confronting our socio-economic challenges. Our labour relations system was born under these circumstances, when there was a level of optimism, passion and political will, coupled with a sense that business, government and labour would cooperate to ensure growth and equity- thus in the long run breaking down the economic foundations of the Apartheid System. 

Fast forward 18 years and we find a society still mired in unemployment, poverty and inequality. Corruption is a scourge and social service delivery is faltering. Our economy is not growing fast enough at a time when the global economy is still struggling to recover. It is very likely that we will not reach the employment goals that we have set in the New Growth Path and National Development Plan.


For some the recent turbulence in our Labour Market is evidence– flawed  in my view -- that our laws and institutions have failed us to the extent that we should throw the industrial relations framework and social dialogue babies out with the bathwater.

From where I sit, I don’t think we are witnessing a wholesale collapse of our industrial relations system, or the inevitable demise of social dialogue and tripartism. 

Yes, there are problems. But the solutions lie less in the legal framework and institutions, and more in the way that government, organized business and labour interact.

A successful South Africa depends mostly on the commitment and capacity of the actors who sit at the main table. It is also, if the truth be told, about what is on the table. What are the trade-offs? Who can commit to what? Who is prepared to make compromises in the interests of the greater good?


Building a new social consensus is going to require bold leadership, common sense, cool heads and a willingness to listen and make compromises. If we as the social partners are not prepared to do this, we are at risk of continuing down a path that at best produces more of the same or being caught up in a spiral of increased social conflict and possibly repression and a reversal of our democratic gains.

Source: www.nedlac.org.za