South African Unions Prepare for Historic Strike on October 7

South Africa is bracing for one of the decade’s most significant general strikes on Wednesday, October 7. Unions are protesting rampant corruption and looting of COVID-19 funds, and the government’s failure to honor a 2018 wage agreement in the public sector.

Unions from across sectors are mobilizing for the strike, called for by the 1.8 million-strong Congress of South African Trade Unions (COSATU). It is the largest trade union confederation in the country.

COSATU has traditionally been an ally of the ruling African National Congress (ANC), which, it now believes, has openly betrayed the country’s working class. This shift in COSATU’s position raises questions about the future of this alliance. It may also open up possibilities for greater unity in the trade union movement, which has faced divisions over the question of the ANC.

The left-wing South African Federation of Trade Unions (SAFTU), the second largest trade union confederation in the country with a membership of 800,000, will also hold demonstrations and pickets on October 7, as will the 550,000-strong Federation of Unions of South Africa (FEDUSA). Its affiliated unions mainly represent public sector workers.

The decision to go on strike was taken by COSATU in the last week of August, after prolonged negotiations with the government at the National Economic Development and Labour Council (NEDLAC) and at Public Service Coordinating Bargaining Council (PSCBC) failed to yield a resolution.

Money meant for workers stolen by employers

One of the central issues around which the strike was called is corruption. Over the past week, numerous senior politicians and businessmen have been named as suspects by investigative authorities. However, no concrete action has been initiated to plug leakages and stop the systematic corruption deeply ingrained in South Africa’s economy, COSATU maintains.

The union had demanded that President Cyril Ramaphosa issue a decree instructing the Special Investigative Unit (SIU) to investigate employers accused of stealing from the Temporary Employee/Employer Relief Scheme (TERS).

TERS is meant to provide assistance in form of a stipend to employees who could not be paid by their employers due to shutting of operations during the lockdown. TERS is financed from the Unemployment Insurance Fund (UIF), accumulated over the years with contributions from the employees and employers.

“The fund was not originally designed to help workers in a lockdown situation. So there was no infrastructure to pay workers individually. The money was sent to employers, who were expected to pay it out to the workers on their payroll. But when they got the money, often only 50% was actually paid to the workers, and rest was stolen,” COSATU’s national spokesperson, Sizwe Pamla, told Peoples Dispatch.

In order to maintain transparency, he said the government and the unions had agreed on an arrangement where as soon as any amount is dispatched to an employer under TERS, the employees should be alerted with a text message, specifying the amount that was sent.

“This was not complied with,” Pamla said. “As a result, the employers have a monopoly on information regarding how much they have received from the government.” This has made it difficult for the workers to hold their employers accountable.

“The government acknowledged this problem. But acknowledgement is not enough. We need concrete actions and the government is not willing to commit,” he complained.

COVID-19 spread due to rampant corruption

The handling of the COVID-19 pandemic is another issue. “We used their own statistics to show that there is only 60% compliance in healthcare facilities. 300 health workers have died. This failure is also a result of corruption,” Pamla said.

According to the first report of the Auditor General (AG), who is investigating the use of R500 billion (US$299 million) COVID-19 fiscal package, the orders placed by health departments had many products “priced at more than double and even five times the prescribed (market) price.”

“We identified similar instances in the procurement of PPE in the education sector where the national and provincial departments are not procuring PPE at market-related prices,” the report further states.

The AG has also documented “matters such as suppliers not having valid tax clearance certificates, quotation and competitive bidding processes not being correctly applied.. conflicts of interest, and the awarding of a contract in the health sector to a supplier with no previous history of supplying or delivering PPE.”

Many beneficiaries of such tenders have familial connections to ruling politicians. To prevent such corruption, COSATU had demanded that the families of politicians should be barred from conducting business with any government departments.

However, at the NEDLAC negotiations, the government strongly resisted this demand, arguing that it would be a violation of the constitutional rights of the family members of politicians.

COSATU argued that such a measure to prevent the conflict of interest is well within the constitutional framework. The union said that government officials could always resign if they felt the businesses of family members was a higher priority.

After the discussion, NEDLAC consulted the law firm Cheadle Thompson & Haysom, which said that South Africa’s constitutional framework does permit the imposition of such a restriction. The government, nevertheless, has remained reluctant.

Government refuses to honor wage commitments

In parallel to these disputes at NEDLAC, discussions also reached a deadlock at the Public Service Coordinating Bargaining Council (PSCBC). These were over the government’s refusal to honor the wage agreement it had signed with the unions representing employees in public service. Titled Resolution 1 of 2018, this agreement specifies the pay hikes the government had committed to for the years 2018/19, 2019/20 and 2020/21.

The pay hike agreed for the latter, which was supposed to be effected from April 1, was Consumer Price Index (CPI) +1% for employees Level 1 to 7, +0.5% for those employed at Level 8 to 10, and an amount equal to the CPI for Level 11 to 12. Soon after this date, when the government had failed to affect the hike, COSATU had taken the matter to PSCBC.

After months of negotiation, in August, the National Treasury, in an outright violation of the agreement, said in its guidelines: “No additional funding will be made available to directly fund costs associated with implementing the last leg of PSCBC Resolution 1 of 2018. No adjustment to salaries should be effected in 2020/21.”

The following month, the government also approached the labor court, seeking an order declaring the wage agreement null and void. “They say it costs 37 billion rands to honor the wage agreement, and that they cannot budget it. But they are losing much more on corruption… 80 billion rands is lost to illicit financial flows every year according to the State Security Agency,” Pamla argued.

“The only real way to stop this”, he said, “is by imposing capital controls. But the government has refused to do it, because it is running a corporate welfare state.”

Its refusal to impose capital controls has turned South Africa’s economy into what he calls a “casino economy”, in which capital gambles on the market and leaves with the booty at will. And the burden of the crisis left behind as a result is shifted on to the shoulders of the working class by the government’s policy of austerity.

“A class-war long overdue”

Due to all these reasons, COSATU has finally come to characterize the ANC as a “class-collaborationist” party which “betrayed the working class.”

COSATU has called upon all the trade unions to unite in a common struggle, not only for the limited purpose of the general strike on October 7, but to “fight the class-war that has been long overdue,” said Pamla.

The General Industries Workers Union of South Africa (GIWUSA) was the first of the SAFTU affiliates to declare “full support” to COSATU’s call.

“GIWUSA is encouraged that COSATU is becoming conscious of the class character of the ANC government and will not defer to it the historic demands of the working class. GIWUSA hopes that this decisive action shall spark the beginning of a sustained collaboration between the two biggest federations in the country,” its statement reads, calling on all SAFTU affiliated unions to mobilize.

“History is calling us to act decisively and we dare not fail.”

This article was first published in Peoples Dispatch.