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Introduction

This year marks the end of the successful implementation of the Ministry of Labour's Five Year Programme of Action from 1994 - 1998. There can be no doubt that the ANC government has fought to make life better for all. The ANC ended apartheid laws, brought dignity and freedom to the people of South Africa, and has fought a five-year battle to change government previously geared to serve a minority. Progress has been difficult, but now changes are happening. This budget therefore is intended to consolidate the various initiatives undertaken, as well as ensure their efficient and effective implementation.

It is for this reason therefore that we take this opportunity to take stock of the progress made since 1994 in transforming South Africa's labour market.

Through the hard work of its staff, spread in 117 labour centres and 10 provincial offices across the country, the Department of Labour has been involved in activities which have had a direct impact in changing people's lives in the world of work for the better. It has done this by initiating legislation enabling the promotion of sound and stable relations at the workplace, protecting the rights of workers and employers, and by providing a range of services to thousands of our citizens, including those in the remotest parts of the country, the jobless, the vulnerable workers (for instance domestic and farm workers), big and small business alike.

Apartheid's legacy

We inherited a world of work based on economic deprivation, adversarial labour relations and the denial of worker rights, a cheap and migrant labour system, massive income and wealth disparities, systematic discrimination against black people, women and other groups, and high unemployment levels.

This terrible legacy did not vanish into thin air when we took over the reins of government. Even today, it continues to weigh heavily on the working lives of our people and in the business environment.

Despite the distorted labour market framework that we inherited when we assumed office in 1994, we have been successful in delivering on our promise of a new labour dispensation that not only entrenches the rights of those denied them for so many decades, but lays the foundation for sustainable economic growth.

Over the past four and a half years, we have been engaged in far-reaching reforms aimed at restructuring the labour market. Consequently, we have made significant progress in implementing the key pillars of the Five Year Programme which we announced in 1994. This included ensuring that our labour market policies promoted economic growth and restructuring, enhanced employment, sound and stable labour relations, the elimination of workplace inequality and discrimination, and skills development.

Unemployment contrived to be the biggest challenge that confronts our young democracy. The crisis of unemployment clearly derived from the structural deficiencies in the economy that we inherited. Consequently our approach was to embark on a range of measures to sort out the mess. They range from the development of a sound macro-economic policy, a coherent and well-articulated industrial strategy, restructuring of state assets and a comprehensive transformation of our labour markets. Like in similar situations elsewhere in the world, such interventions take time to show their impact on job creation. We remain satisfied that an important foundation has been laid for an economy whose efficiency has been improved and its ability to absorb more labour has been enhanced.

We complemented these measures with short to medium term interventions aimed at job creation. Since 1994, our National Public Works Programme, which is administered by the Department of Public Works, created jobs which reached 44 000 people by the end of last year in various projects, including school building and refurbishment, clinics, road and dam construction and other related projects. Under the auspices of the National Economic Forum (NEF), the Department of Labour has, since 1994, used the DBSA as an agency for job creation projects which generated about 46 700 jobs over that period. The Department of Water Affairs has been running two projects, "Water supply" and "Working for Water". Through these, the government has been able to reach approximately 60 000-65 000 people, offering short term job opportunities.

Through various initiatives aimed at promoting Small, Micro and Medium Enterprises (SMME) a large number of jobs have been generated. According to the Department of Trade and Industry, in the period April 1998 to January 1999, about 1630 new businesses were created, resulting in approximately 11 100 jobs. These were achieved with the assistance of Ntsika and Khula.

Over the past three years, tourism has created 187 170 new jobs across the South African economy. Today's travel and tourism sector represents 737 600 jobs, which is 7% of total employment in South Africa. Through job creation programmes, the Department of Housing has contributed to the creation of 681 203 permanent jobs and 2 million temporary jobs.

Madam Speaker, jobs, jobs, jobs, is what this government promised the South African people. It is a promise that we have delivered on, even in an environment in which the private sector had been shedding jobs and the crisis in the international money markets has resulted in a low growth rate. Through our long term measures to build on these gains, we are determined to reverse the overall tide of unemployment.

The job creation measures I have outlined above, are but a few examples of the short to medium term job opportunities arising from direct projects that are linked to infrastructure development and economic restructuring. The participants in these projects benefited in various ways. They not only obtained income to support themselves and their families. They secured training and improved their skills. Consequently, they enhanced their employment prospects. Although short term in nature, these projects are linked to the long term restructuring.

Notwithstanding these measures on the part of government, there is a general recognition that efforts aimed at dealing with the scourge of unemployment require a common commitment from all the actors in the economy. Unlike some of our honourable members in the opposition benches who engage in wishful thinking, our social partners have a deeper understanding of the cause and nature of the country's unemployment problem.

We are already hard at work in implementing some of the projects arising from agreements reached at the Jobs Summit of October last year. These include "Working for Water" and the special project on housing which will focus on rental stock. The Youth Commission and the Departments of Education and Labour have developed a project on Youth Brigades and Service Corps to table at the US/SA Binational Commission for funding. However, money from the National Skills Fund and Umsobomvu will be used to invest in these projects.

While certain matters were not resolved at the Jobs Summit, its success lay not just in the wide range of projects and programmes set out in the Declaration adopted, but in marshalling the resources and energies of all stakeholders to address the scourge of unemployment. All the participants recognised that meeting this challenge requires that we all move beyond a fruitless finger pointing exercise, to active partnerships around projects and programmes that will have a direct impact on improving the employment creating capacity of the economy.

It is for this reason that I wish to applaud those within the South African business community who have established the Business Trust through which various enterprises can contribute to the advancement of human resource development and tourism. In the same vein we congratulate the unions for establishing the Job Creation Trust to support the Jobs Summit conclusions. I trust that the members of other parties will follow the good example of the ANC caucus and pledge to contribute one day's salary to this fund.

The Jobs Summit was also a clear expression of the common commitment of all stakeholders to ensuring that a range of policies, including labour market policies, trade and industrial policies and other macro-economic policies contribute to our goal of job creation.

Together, fighting for change. A better life for all. For this reason the South African people will vote for the ANC again.

These initiatives have all been in line with what we promised the people of South Africa. Indeed, the opposition is deliberately creating a false impression that this government promised jobs but proceeded to destroy them. They opportunistically seek to create the impression that the decline in levels of employment is a peculiarity of our economy and a result of our policies. These are the efforts of an unholy alliance which has, to the point of being less than honest, been keen to hide the fact that it is the legacy of their ill-conceived policies and programmes that are the root cause of the scourge of unemployment.

As government, we recognise our role in creating a climate that is conducive to raising levels of employment and economic growth. However, we are under no illusion that we can ever assume the role of providing jobs, as if we were a planned economy.

In addition to the strides we have made in relation to economic restructuring and job creation, our other main achievements have related to the development of active labour market policies, the enactment of major new labour laws, and the establishment of new programmes and institutions to ensure the effective implementation of these laws.

The primary pieces of labour legislation in this regard are the Nedlac Act, Labour Relations Act, the Basic Conditions of Employment Act, the Skills Development Act and the Employment Equity Act.

Social partnership

We have through these five pieces of legislation undertaken to deal decisively with the problems of the apartheid past. You will remember the years when labour and large sectors of civil society had little choice but to take to the streets in pursuit of their objectives. This is because they were excluded from policy making process. Indeed, this cost the economy millions of rand in lost production and lost us market opportunities. The remarkable decline in these kinds of activities during the term of this government is no accident of history. It is a positive outcome of our commitment to social dialogue and partnership.

A major contribution to effecting a new labour market dispensation has been our success in building and promoting this spirit of social partnership. Despite divergent views on labour market policies, we have succeeded, through an ongoing process of consultation and negotiation with our social partners, in reaching substantial national consensus on legislation and other measures. This in itself is a notable achievement. In this regard, the National Economic, Development and Labour Council (NEDLAC), made up of organised business, communities, labour and national government, has played - and will continue to play - a critical role.

While this has often been a protracted process, we believe that this has enhanced the quality of our young democracy. It has meant that, unlike the unpopular apartheid laws, our new laws enjoy widespread legitimacy. This in turn lays the basis for the successful implementation of these laws by key stakeholders.

Labour Relations Act

Remember the level of strikes arising from the denial of such basic rights as freedom to form and belong to unions, unfair dismissal or retrenchments and the denial of reasonable conditions of service. These conditions of instability were never going to encourage investment in our economy, hence our enactment of the Labour Relations Act of 1995.

We, as promised, enhanced organisational rights for trade unions, entrenched the constitutional right to strike, simplified dispute resolution procedures, the promotion of collective bargaining and the codification of dismissal procedures. We have established formidable and more efficient institutions to deliver a stable labour relations system.

Registered bargaining councils now cover 32% of the workforce and approximately 53 000 employers.

There has been an overall decrease in strike action and strike-related violence during the period since 1994, except for 1998, which saw an increase that nonetheless remained below the pre-1994 period. Unlike in the past, the vast majority of strikes have been within the law.

Both business and labour are satisfied with the services provided by our leading dispute resolution institutions, the CCMA and the Labour Court. Since November 1996, an average of 270 cases per working day were referred to the CCMA and 85% of these were resolved. The Labour Court and the CCMA have helped avoid disruptive strikes.

Madam Speaker, even our worst detractors would in their moment of honesty, quietly concede that this law has clearly had a significant positive impact on our country's workplaces. It has laid the foundations for a more peaceful and stable labour relations environment and enabled us to move away from the adversarialism of the past.

We remain concerned that the continued high income differentials, poverty among working people and constant fear of retrenchment and job insecurity are potential threats to the labour market stability achieved over the last period.

Basic Conditions of Employment Act

Why should society carry the burden of avoidable injuries and diseases contracted in the workplace or, worse still, death? Cost cutting measures, negligence and unduly long hours of work with minimal rest, are among the key causes of these problems in the workplace. There are those in the opposition benches who would rather we showed willingness to expose workers to these dangers in order to promote labour market flexibility.

In 1996, the economy lost an estimated R17 billion, which formed 3,5% of the GDP as a result of accidents and fatalities in the workplace. Over 200 000 people were injured and 508 lost their lives in the year 1996/97 according to the Compensation Commissioner's report. This state of affairs is totally unacceptable. That is why we are not prepared to compromise on the enforcement of Occupational Health and Safety regulations and other preventative measures.

The Basic Conditions of Employment Act was promulgated on 1 December 1998 after its enactment in 1997. This Act, which stands to improve the lot of about six million workers, sets down minimum conditions in respect of working hours, leave and the termination of employment. It also prohibits the employment of children and forced labour.

We have introduced a single floor of rights for all workers except members of the army, intelligence services and non-paid volunteers working for charitable organisations. Contract workers, commission only workers, home workers and part time workers will, for the first time, enjoy these protections.

Agricultural and domestic workers stand to gain from the new legislation. For the first time, the state can and will set statutory minimum wages for workers in these sectors.

We have introduced an improvement on annual leave and maternity leave and introduced new conditions for night work and family responsibility leave. A new dispensation in respect of working time now prevails. It improves protection for workers while also enabling workers and employers to shape working time in ways which best suit individual circumstances and the needs of the enterprise. So much for inflexibility.

Employment Equity Act

An important factor that accounts for the inefficiencies in our economy generally and the labour market in particular has been the policy of discrimination which was enforced in the past. This policy saw the placement of often mediocre white males in positions of leadership, even when they lacked the required skills and competency. Blacks, females and the disabled in particular, and a number of other categories of employees, were confined to marginal roles. This imposed inefficiencies in the allocation of labour and had adverse consequences for our economy.

In the light of this reality, we promulgated the Employment Equity Act, whose principal objective is to promote equity in the workplace. The Act also seeks to give effect to the Bill of Rights within the sphere of employment. Whilst the Constitution lays the foundation by prohibiting discrimination, it also calls for legislation that gives effect to this. This law therefore spells out the process and the steps that must be taken to develop and advance groups that have been disadvantaged in the past.

Despite the criticism of our detractors, we have received reports of companies which have embarked on measures to ensure compliance with the Employment Equity Act even before it has been promulgated. We welcome and encourage such efforts and hope that these companies will take a lead for others to follow.

Skills Development Act

One of the principal causes of our economic deficiencies is the low level of skills in an environment that is increasingly experiencing a major change in the workplace, relying on methods that require more skill. The low skill base is one of the reasons for the low levels of investment in our economy. The challenge is to raise investment from the current 17% of the GDP to at least 20%, in line with other developing economies.

Raising the skills level of our workforce would improve, not only the productivity of both labour and capital, it will also enhance the competitiveness of our products in the global system. For this reason the Skills Development Act, which aims to address these problems by fundamentally improving the relationship between the education and training system and the workplace, has been enacted. Aspects of the Act relating to the establishment of the National Skills Authority and the National Skills Fund have already been promulgated, and the Act as a whole will come into effect later this year.

The Skills Development Planning and Information System will identify skill priorities in industry and track the growth and decline in employment and occupational categories across economic sectors. This will enable government to target skill formation more effectively and improve education and training decision making by industry and training providers.

To address constraints facing new entrants to the labour market, particularly our youth, the Skills Act puts in place a new learnership system, which combines learning and work experience for job competence in areas where there is a clear skill demand. Pilot projects with 255 learners in KwaZulu Natal suggest that this approach will greatly improve the placement of learners after qualification.

Under the auspices of ten major projects set up to implement the Act, a minimum of 4000 people will have successfully completed learnerships by the year 2001. Over time, this can be expanded to 25 000, at least 80% of whom should find or create work. Unemployed young people will be the principal beneficiaries of these programmes.

THE FUTURE CHALLENGE

As the first Five Year Programme of Action comes to an end and as we anticipate the aftermath of the forthcoming elections to be held on 2 June 1999, the Department is already embarking on a second Five Year Programme of Action. This next phase will concentrate on ensuring that our policies are effectively implemented and that they efficiently complement economic growth, employment promotion and equity. Within this context, the Department will also be continuing with the implementation of its restructuring to enhance service delivery and contain costs. The current budget vote of the Department allows us to proceed with these tasks in the coming year.

Thank you Madame Speaker.

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