Deputy President Rampahosa addresses Nedlac Annual Summit

Deputy President Cyril Ramaphosa: Address at 21st Nedlac Annual Summit

9 Sep 2016

Minister of Labour, Ms Mildred Oliphant,
Minister of Economic Development, Mr Ebrahim Patel,
Nedlac Executive Director, Mr Madoda Vilakazi,
Our honoured guest, Professor Jose Gabriel Palma,
Delegates from all the Nedlac constituencies,
Distinguished guests,
Ladies and Gentlemen,

It is an honour to address you this morning on the occasion of the 21st Nedlac Annual Summit.

Nedlac is nearly as old as our democracy. It was established on the back of a difficult, but successful negotiated transition.

It was established as a platform for social dialogue, marking a decisive break with the discord and antagonism of the past.

It must continue to be our country’s most effective mechanism to facilitate consensus among the social partners in finding appropriate solutions.

The defining challenges identified by Nedlac at the time of its establishment were sustainable economic growth and greater social equity.

Despite the many achievements over the past 21 years, these remain our most significant tasks.

It is therefore appropriate that at this summit, we have chosen to deliberate on the urgent measures we need to undertake to achieve rapid economic growth and the creation of decent jobs.

The rapid economic growth that we need must be sustainable and equitable.

It must be founded on participation, social dialogue and courageous leadership.

Ladies and Gentlemen,

The National Development Plan sets a target of 11 million additional jobs by 2030 and a rise in the labour force participation rate from 54 percent in 2010 to 65 percent.

If we are to achieve these targets, we need to take extraordinary measures.

We need to accelerate the implementation of those programmes that have shown the greatest promise.

We must move with greater urgency to remove the blockages to greater economic activity that we have identified.

Most importantly, we need to develop new, refreshing, innovative approaches to creating work.

From 1994 to 2015, South Africa’s economy experienced average annual growth of 3 percent.

Last year, we achieved growth of only 1.3 percent.

The news this week of growth of 3.3 percent in the last quarter should encourage us to deepen collaboration between all social partners in implementing an agenda for growth and development.

The OECD Economic Survey that was launched in July 2015 recommends that we tackle infrastructure bottlenecks and improve business regulation to support job creation.

There are a number of actions that the OECD points to that speak to the labour market, such as expanding affordable public transport and building the public employment service as a one-stop shop for job seekers to lower the cost of job search.

These recommendations align with the National Development Plan, which recognises the spatial legacies that characterise South Africa’s labour market and poor access to information about work.

The plan points out that many new jobs that will need to be created are unlikely to be highly paid.

They will be in labour intensive sectors and even in public employment initiatives.

We need to frankly discuss how we align our efforts to promote decent work with the extremely urgent task of getting unemployed people into jobs in significant numbers in the shortest possible time.

Work is indeed underway.

We have seen progress in the revitalisation of agriculture and the agro processing value chain and in advancing beneficiation.

Through the establishment of special economic zones, the refinement of our industrial incentive programmes and the establishment of entities like Invest SA, we have recently managed to attract significant investment into our manufacturing sector.

Operation Phakisa has begun to yield results through new investment in the oceans economy.

Even in a constrained fiscal environment, we continue our massive investment in economic and social infrastructure.

We are implementing new initiatives to support small business and expanding our public employment programmes.

Importantly, government is working with business and labour to implement specific immediate measures to boost employment.

We expect announcements soon on planned interventions in key sectors of the economy, the stabilisation and reform of state-owned companies, youth employment programmes and private sector co-investment in infrastructure.

Significant progress has also been made within Nedlac on the measures to promote labour market stability and reduce income inequality, specifically through the introduction of a national minimum wage.

All social partners are committed to ensuring that this important work is concluded without further delay.

We commend the leadership that labour has provided in helping to save jobs.

We believe that our success in stabilising the economy and increasing production has been helped by the call from some in labour that in the course of wage negotiations we should seek a balance between pay rises and job security.

They are correct in their assessment that excessive wage demands can have a negative impact on employment.

Business needs to respond by demonstrating its commitment to constrain excessive executive pay and preserve jobs even during periods of economic stress.

We need a serious conversation about change.

We are tasked with convening a Jobs Summit by the end of the year.

The success of the Summit will lie in the ability of the Nedlac constituencies to open up new ground in the discussion about the labour market and jobs.

A conversation about rapid growth and the labour market will be difficult.

It will have to balance the interests of those around the table with those outside who are excluded from active labour market participation.

It will have to bear in mind what the Governor of the Reserve Bank said recently.

He said:

“For many South Africans in jobs, the struggle is to hold on to employment and keep wages growing enough to support large numbers of dependents. We need to turn this around, increasing employment and lowering dependency ratios. The best way to raise household income is to increase employment.”

We all have a shared interest in raising employment and improving household income.

This is a time where social partners need to speak with one voice and act in concert.

It is a time for commitment, innovation and courage.

Our public posture and our public statements should not puncture the hopes and thwart the dreams of millions of South Africans who live daily with grinding poverty, squalour and marginalisation.

We must engage, not insult.

We must attend to our differences and pursue our shared interests.

And we must be prepared, each of us, to acknowledge our own shortcomings.

As social partners we need to recognise how our own actions may be undermining the collective effort to grow the economy.

As government, we are aware of the concerns of our social partners – and of the South African public – about recent events within the state.

We recognise that there is an impression of a lack of coherence within government and that different institutions of state are in open conflict with each other.

It is unfair to expect our social partners to achieve a stable labour environment, when we appear unable to maintain a stable state.

We cannot expect our social partners to overcome their differences, when we in government cannot overcome our own.

A well-functioning government should not be at war with itself.

Where there are differences, we must be able to resolve these through dialogue and cooperation.

We must not create an impression that our actions are influenced by any considerations other than the advancement of the interests of the South African people.

We are working at addressing these issues.

We are working to ensure that all public entities, including state-owned companies, uphold the tenets of cooperative governance as required by our Constitution.

We are determined that these events will not undermine the excellent work being done across government and should not derail the measures we’re developing together to grow the economy.

In this, we are guided by the NDP, which says that in order to play a transformative and developmental role, state institutions need to be well run and effectively coordinated, with public servants who are committed to the public good.

We are committed to ensuring, as the NDP proposes, that the public service is immersed in a developmental agenda but insulated from undue political or other external interference.

Ladies and Gentlemen,

This 21st Nedlac Annual Summit is confronted not just with issues of the workplace or labour market.

It is confronted with the challenge to create a new society.

It is confronted with the challenge of creating a society where people do not destroy property or endanger lives when they have grievances.

Today we must condemn those that wilfully deepen the financial crisis at universities by causing millions of rands of damage to the very institutions that must educate them.

In a democracy, no amount of anger or frustration justifies such behaviour.

If our history has taught us anything, it is that there is no problem we can’t overcome by working together.

This summit must be about building a caring nation that listens more.

In pursuing this objective, we must be inclusive, accountable, but decisive.

We can only say our work is done when young South Africans are in productive employment, when people can support themselves, when all poor students can access quality education.

We can only say our work is done when we produce more women engineers, doctors and accountants, when we derive more value from our minerals, when we process our crops where they are grown.

We can only say our work is done when all South Africans have electricity in their homes, when they all have reliable, safe water and decent sanitation.

We can only say our work is done when we have a growing, inclusive economy that creates decent jobs.

At the heart of this Summit, is the need for all of us to contribute meaningfully to building the country’s social fibre.

We can do so by working together to transform the economic landscape for the benefit of all.

We need greater collaboration and greater urgency.

We look to this summit to steer our country to become a nation at work and a nation that works.

I thank you.