Labour Budget Review; FEDUSA & SA Federal Council on Disability Submissions on Budget

Meeting report

LABOUR PORTFOLIO COMMITTEE
11 March 2003
LABOUR BUDGET REVIEW; FEDUSA & SA FEDERAL COUNCIL ON DISABILITY SUBMISSIONS ON BUDGET

Labour Budget 2003: Vote 17 - programmes and allocations
South African Federal Council on Disability submission
Federation of Unions of South Africa: Comments on General Budget
FEDUSA submission on Labour Budget
Powerpoint presentation by Labour Department

Department of Labour website

SUMMARY
The Department of Labour detailed their strategic programmes for 2003 and explained the budget allocations. The South African Council on Disability discussed the situation of disabled persons and possible changes in the Labour budget process that could positively affect those persons. FEDUSA made several recommendations concerning job creation. The problem of poor implementation of legislation other directives was repeatedly raised. The Chair noted that there would be a public hearing on the progress of the Sectoral Education and Training Authorities.

MINUTES
Briefing by the Director General, Department of Labour
The Director General, Mr Rams Ramashia, covered the following main points during his budget presentation (see document):
- Mission Statement
- 15 point Programme
- Strategic Plan
- Legislation
- Strategic Objectives
- Main Divisions

Research and monitoring and review of policies was of strategic importance in the implementation of Departmental initiatives. The Department identified the following as specific objectives: skills development, employment equity, the protection of vulnerable workers, the development of occupational health and safety considerations, the formulation of an improved social safety net, and the promotion of stable labour relations.

Their mission statement contained the essence of the attitude and objectives of the Department.

The first phase of the productivity program, assisting companies, was implemented through the Productivity Institute.

Skills development had been implemented through social partners, including the Sectoral Education and Training Authorities (SETAs), which played an important role. All reports by social partners were carefully analysed to monitor progress in implementation.

The Basic Conditions of Service Act needed more power for implementation of its provisions. The Department was working on amendments to alleviate implementation problems.

Further Wage and Conditions of Service Determinations would shortly be promulgated. He cited the abuse related to the employment of foreign migrant farm workers whereby some farmers have reported these workers to the police for deportation to avoid payment of wages.

The Department has progressed in the registration of domestic workers. Additionally, the FY IT collections for UIF have been proceeding steadily.

The Director General concluded by stating that the NEDLAC meetings that the department attended had been "vibrant".

Briefing on the Budget Allocations by the Chief Financial Officer of Department of Labour.
The Chief Financial Officer, Mr Chris van der Merwe, explained the graph on MTEF allocations, the line items and graphs of the budget per programme, the MTEF line items per programme, and the line items of the budget per standard items. Finally, he detailed the graph on the transfer of payments.

DiscussionMr J Durand (NNP) said that it was incumbent on the Department to strictly monitor the implementation of legislation. He stated that any serious problems with the implementation of affirmative action should be referred to the Committee.

The Chief Financial Officer agreed that unfair practices towards farm workers existed. Apropos the example of migrant farm workers receiving deportation rather than pay, the Department was working on legislation to amend this situation. Legislation would be introduced to protect the rights of all legitimate immigrant workers. A report by the Employment Conditions Commission (ECC) would be made public in this regard. He reiterated the need for minimum wage determinations. He disapproved of the payment of wages in kind such as the provision of wine or mealies. With regards to affirmative action, the definition should be carefully interpreted. Affirmative action was not intended to keep qualified and experienced people out of employment where affirmative action was impracticable.

Mr M Manie (ANC) placed on record the committee's satisfaction with the progress of sectoral determinations. He was pleased to see that vulnerable workers, such as domestic and farm workers, were being protected by such determinations

Mr S Mshudulu (ANC) said that enforcement of government policies would need to be given priority. He advocated the decentralisation of monitoring agencies. There should be more progress on the finalisation and implementation of the national policy on the eradication of child labour. He suggested that a pamphlet be circulated to workers, spelling out the CCMA procedures and functions. It was the Department's duty to foster an environment for job creation.

The Chief Financial Officer replied that he would raise Mr Mshudulu's concerns on child labour and the CCMA (Commission for Conciliation, Mediation and Arbitration) with the Minister.

Mr D Oliphant (ANC) traced the influence of the apartheid policy on the advanced education for technical skills applying to coloureds and blacks. He said that urgent attention should be given to the establishment of education facilities for skills particularly in disadvantaged areas.

Reply: The Department has been working consistently to provide more institutions for technical training. The main problem was the unavailability of facilities with access to electricity and computers needed for such training. Most of the unemployed are youth's who find it difficult to overcome the lack of experience required for most advertised jobs. He accepted that the shortage of funds inhibited the effectiveness of SETAs and the CCMA.

Mr R Morapa (ANC) believed that the National Productivity Institute should play a key role in job creation. He asked the CFO for details of the programmes that had been under-funded. How was the surplus on the UIF line item of the budget being utilised?

Reply: Everything must be done to promote job creation. The Department was coming up with potential solutions, such as economic interventions, the promotions of public skills, and the development of skills and education. He added that partnerships were being created at all levels within the economy with job creation in mind and offered the St Lucia partnership with tourism as an example. The surplus on the UIF was re-invested by the fund to hedge insurance contingencies.

Mr M Ramodike (UDM) asked the CFO to explain those factors that had led to budget cuts. How were such cuts prioritised? He also questioned the unfilled vacancies, asserting that the figure of 800 vacancies was disconcerting. He expressed concern about the mobility of the Department's staff. Additionally, he referred to the national brain drain.

Reply: The budget cuts have made it a challenge to implement policies effectively with less money. This challenged the Department to increase efficiency and productivity. The dynamics of labour mobility has been a problem that involves all sectors of the population. As to the approximately 800 unfilled posts, he emphasised that this was more part of a projection onto the future requirements. Furthermore, the Minister of Home Affairs had been addressing the problem of the brain drain, which has been augmented by currency exchange rates.

Ms H Malebana (ANC) referred to the problem of insufficient budgetary allocations to cover the cell phones and vehicles needed by the inspectors. The inspectorate was of critical importance in the monitoring of the implementation of policies. She was concerned about the inability of the market to provide jobs to students graduating from schools, tertiary, and technical institutions.

The Chief Financial Officer responded to the concerns about insufficient funds for certain items by saying that the request for tools for inspectors had been cut from R90 million to R10 million. This has hindered the supply of cell phones and vehicles to inspectors to such a degree that funds had to be taken from other less important allocations. He agreed with the need for greater inter sectoral co-operation. He mentioned that the Labour Department was in a position to advise claimants via the CCMA on procedures and requirements prior to an application.

South African Federal Council on Disability input on the Labour Budget
Ms P Linders suggested that budget processes should be made available upon request to persons with disability. The National Treasury should implement the principle of self-representation and include requirements of the disabled from the onset. The concept of the integration of the budgeting process should make way for targeted budgeting.

The National Treasury should promote the principle of intersectoral collaboration. All performance agreements with Ministers and Government Officials should include a key service performance area dealing with the quality of service delivery. Ms Linders invited the Treasury to discuss an approach in the Disability Sector on disability matters in the Medium Term Expenditure Framework.

Federation of Unions of South Africa (FEDUSA) input on the Labour Budget
Ms G Humphries complained that since the launch of the National Skills Development Strategy (NSDS) in 2001, no tangible progress had been made, particularly with regard to new entrants less than 30 years of age. The Department of Labour has failed in its endeavour to deliver in the area of learnerships and this matter must be urgently addressed in order to avoid national embarrassment

To assist with the stimulation and supporting of skills and small businesses initiatives, the Department of Trade and Industry and the Department of Labour should follow up on new companies as the Department of Finance does relating to tax matters.

The Department should set up a one-stop service centre in provinces and rural areas.

The conditions for the creation of jobs could be facilitated by establishing a more conducive environment for Small, Medium and Micro Enterprises (SMMEs).

As far as the CCMA was concerned, funding problems have resulted in staff shortages and a backlog of cases. Ms Humphries called for an investigation into the allocation of funds to the CCMA. Another area of concern is the Strengthening of Civil Society fund and the way funds are allocated in terms this programme

Ms Humphries submitted the following recommendations:
-The Committee should pay special attention to Section 18.2 of the Skills Development Act.
-Tax incentives should be made in grant format.
-Steps should be taken to ensure greater publicity for learnership opportunities.
-An indaba should be called to bring various role players together for discussions on budget allocations.

NEDLAC input
Mr P Dexter, CEO of NEDLAC, explained that he would brief the Committee at a later date due to time constraints.

DiscussionMr K Monogamy (ANC) agreed with the policy of targeted budgeting for the disabled. This would help government take the sector more seriously. FEDUSA should provide facts and figures on the expectation of the creation of 80 000 learnerships for people by March 2005. Further, the levying of contributions from social partners should be tightened with the Minister's approval.

Mr Mshudulu stated that organised labour should play a more active role in the regional and local decision-making bodies. Labour centres had been set up in most large and small communities and FEDUSA could call on them to assist in the implementation of its functions. He mentioned that the disability constituency could also lean on labour centres for assistance. The participation by NEDLAC, particularly in the way it carried the message to the people, was unsatisfactory. He was also unhappy with the shortages of inspectors.

Mr M Manie called for concrete details of problems, not generalisations. Funding was not always the panacea for problems. Recommendations were necessary for specific problems. He mentioned that there would be a public hearing on the progress of the eight SETAs.

Ms Linders emphasised that the work of implementing legislation lagged behind legislative and other directives. She endorsed the need for NEDLAC and other organisations to become more active at the local level. Deaf pupils were refused admission to universities after obtaining university grants because the Ministry of Education refused to allocate grants to those beneficiaries for interpreters.

Mr Manie concluded the meeting by thanking all those that contributed to the budget debate at the meeting. It was an important innovation for the public and the Portfolio Committee to participate in the Budget debate.

The meeting was adjourned.