Address by Deputy President Cyril Ramaphosa at the 19th NEDLAC Annual Summit

05 September 2014

Photo of: Deputy President Cyril Ramaphosa

Theme: Towards A National Minimum Wage for South Africa
Programme Director,
Minister of Labour, Mildred Oliphant,
Minister of Public Works, Thulas Nxesi
Deputy Minister of Labour, Nkosi Phathekile Holomisa,
Leaders and Delegates from the NEDLAC Constituencies,
NEDLAC Executive Director,
Government Officials,
Distinguished Guests,
Ladies and Gentlemen:
We meet here at a critical moment in the history of our young nation.
As we reflect on 20 years of democracy, we can be sure of numerous achievements. We know that we have made progress.
Yet we are also keenly aware that our people face massive challenges. Not enough of our people are in work. Millions still live in poverty. We are among the most unequal societies in the world.
As one of the first key national institutions to be established after the 1994 election, NEDLAC counts among our successes.
It was established on the back of a difficult negotiated transition and has played a critical role in meeting the challenge of social development and economic growth.
NEDLAC was founded on the premise that the country’s social and economic challenges could only be addressed through structured engagement among key social partners.
Since its establishment, NEDLAC has been occupied with the promotion of sustainable economic growth and greater social equity. It has sought to promote increased participation by all stakeholders in economic decision making at national, company and shopfloor level; this to foster cooperation in the production of wealth and its equitable distribution.
Yet while NEDLAC counts as one of the successes of our democracy, we should acknowledge that – like our broader transformation effort – it has been a mixed success. Our performance has been uneven.
Our task is far from complete.
Programme Director,
We meet here today to develop a common view on how we may work together to achieve inclusive growth.
We do so because we know that while significantly faster economic growth is critical to the achievement of our development objectives, it is not enough.
Growth is necessary for social progress. But it is not sufficient.
We need to ensure that the benefits of growth are more equitably shared. We need to confront poverty and inequality.
Inequality is an affront to our new democratic order and undermines our ability to extend rights and opportunities to all our people.
Such high levels of inequality make it harder to reduce poverty even when economies are growing. They constrain the productive capacity of the poor and the contribution they can make to development.
The National Development Plan, which received an overwhelming endorsement from the electorate in May this year, provides a framework for accelerating inclusive growth over the next two decades.
We recognise and acknowledge the concerns that have been raised, particularly from organised labour, about elements of the NDP.
We need to engage on areas of disagreement while working together on those areas we agree on, such as the need to speedily eliminate inequality, unemployment and poverty.
There is no way that any social partner can be left behind in our effort to achieve the objectives of the NDP.
We succeed – or fail – together.
In the immediate term, our growth prospects are constrained by a global economic environment that is struggling to emerge from the financial crisis that started in 2008.
However, domestic factors play a significant role as well. These include low investment and savings, weak domestic demand, low business confidence, energy constraints, and challenges in our labour market.
It is to tackle precisely these constraints that government adopted the Medium Term Strategic Framework. Guided by the National Development Plan, it sets out our priorities and key targets for the next five years.
Central to these is a massive, coordinated infrastructure investment programme, and measures to drive growth in key productive sectors of the economy.
We are working to correct spatial imbalances in economic opportunity and eliminate unnecessary regulatory burdens.
Critically, we are focused on expanding and improving education and skills development appropriate for a growing economy.
As social partners, we need to have urgent conversations about how to tackle these domestic constraints such that we accelerate the sharing of the democratic dividend.
Ladies and Gentlemen;
While the challenges in our labour market are significant, we should be careful not to ascribe our weak economic performance primarily to labour market issues.
We need to look at the problems – and solutions – holistically.
We need to start by ensuring that our social dialogue processes become effective tools that solve problems. This is a particular challenge for the collective gathered here this morning.
Internationally, social dialogue has played an important role in the evolution of the modern workplace and in political and economic decision making in many countries. Particularly over the last half century, effective social dialogue has served to lift millions out of poverty.
In South Africa, we have a rich tradition of social dialogue.
NEDLAC is just one such manifestation of this tradition.
It is one of the few bodies in the world that institutionalises consultation and cooperation on social and economic policy among representatives of the state, business, labour and civil society.
As we work to address the challenges of the present, all social partners, including government, need to recommit themselves to the founding principles of NEDLAC as the apex forum for national social dialogue and to strengthen their participation.
At the same time, we should work to ensure greater coordination across all platforms of engagement.
Programme Director,
Over the past two years, workplace conflict has emerged in the form of strikes of long duration and which are sometimes violent. This situation reflects a deeper challenge around conflict in the workplace.
It was to address this challenge that President Jacob Zuma announced in his State of the Nation Address that the Deputy President would be given the responsibility to convene a social partners dialogue within the ambit of NEDLAC, to address related challenges of prolonged violent strikes and wage inequalities.
This dialogue is intended to principally address the untenable labour relations environment that gives rise to these strikes, to deliberate on wage inequality, and to examine the role of a national minimum wage in dealing with poverty and inequality.
In this regard, I will be convening the first high-level dialogue between the social partners in November 2014 to take forward deliberations on key issues facing the labour market, especially the state of labour relations.
We need to understand the factors behind protracted conflict in the workplace, and agree as social partners on steps to address these.
Many of these issues cannot be addressed merely by amending labour laws, but rather require agreement between social partners on the reorganisation of inclusive negotiations and of bargaining processes within workplaces and across sectors, as well as modifications and expansion of the social wage.
It requires that we attend to the causes of protracted and violent strikes, rather than pursuing measures that only address themselves to the symptoms.
We need to examine and understand income inequality, and develop measures to reduce it.
Among other things, we need to examine the value and possible challenges of implementing a national minimum wage.
In this connection, at the November Labour Relations Indaba, all social partners are expected to present their proposals so that we can thoroughly and thoughtfully engage on this national minimum wage issue. This will help us identify areas of commonality and measure how far social partners are from each other, thus shaping further engagement as we move towards preparing a framework document outlining possible modalities and parameters for the introduction of the national minimum wage.
While we must proceed with urgency, we must ensure that our deliberations are thorough, based on sound evidence and widely canvassed.
We have an opportunity to transform our workplaces, significantly alter the relationship between employees and employers, and establish a platform for faster, more inclusive economic growth.
As government, guided by the vision of building a better life for all, we will dedicate our resources and energies to forging a social compact that brings together all South Africans in pursuit of a common vision for change.
It is a vision of an economy that is growing, creating jobs and generating the resources needed to meet the material needs of its people.
It is a vision of a society in which poverty is eradicated and inequality reduced.
It is a vision that unites and compels all South Africans.
And, I believe, a vision that binds all of us gathered here today together.
I thank you.

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