Organised labour says International Workers’ Day on Friday comes at a time when workers are “drowning under a deepening cost of living crisis” in South Africa.
“According to the Competition Commission ‘Cost of Living Report’, in the past five years the price of electricity has risen by 68%, water by 50%, food by 45%, primary education by 37% and secondary education by 42%. Medical aid is also a key factor. For instance, Government Employees Medical Scheme contributions have risen by 23.2% in two years,” said Cosatu spokesperson Zanele Sabela.
“Working-class households are spiralling deeper into debt as they try to make ends meet, given that each job on average supports up to seven family members.”
Business Day reported recently workers’ real wages are likely to slump in the coming months due to higher living costs emanating from the effect of the Middle East conflict, setting up potentially fractious salary increase negotiations with businesses.
The first punch came in early April when the retail price of petrol rose by R3.06 a litre and the wholesale cost of diesel jumped R7.51/l despite government intervening to soften the blow from higher global prices by cutting the general fuel levy added to the pump price by R3/l.
Lower-income workers spend about 40% of their salary on transport costs, and that is likely to increase if the Middle East war keeps global oil prices elevated, making another fuel price increase in May unavoidable for South Africa, which imports most of its oil and refined petroleum products.
Labour inspectors play a critical role in the enforcement of labour laws, particularly now that they have been empowered to enforce compliance with regard to the payment of pension fund contributions. Enforcement of the national minimum wage also needs more focus
— Zanele Sabela, Cosatu spokesperson
Business Day reported on Wednesday government is extending its general fuel levy reduction for petrol by another month, until July, and pausing the tax on diesel altogether to partially cushion consumers from the blow of another round of hefty price increases in May stemming from the war in the Middle East.
This will bring the estimated cost of the temporary fuel levy relief introduced on April 1 to R17.2bn in forgone tax revenue, the National Treasury and the department of mineral & petroleum resources said in a joint statement on Tuesday.
On Wednesday Sabela said the labour federation welcomed the fuel price relief provided by the National Treasury but has been “deeply concerned about the lack of relief for households that use paraffin. A litre of paraffin costs up to R28. These are the households that need relief the most”.
“Unemployment is dangerously high at 41.1% (expanded definition), and more than 70% for young people aged between 15 and 24,” Sabela said, adding economic growth was far below the 3% required to create jobs.
“Cosatu has been disappointed by Treasury’s insistence on tabling a budget that balances the books instead of stimulating economic growth, fixing public and municipal services, filling critical public service vacancies, providing relief for the poor and unemployed, adjusting the social relief of distress grant for inflation, boosting employment, and providing more support for Eskom, Transnet and Metrorail.”
She said Cosatu was pleased to learn the government intended to employ 10,000 more labour inspectors but was disappointed when no allocation for their employment was mentioned in the budget.
“Labour inspectors play a critical role in the enforcement of labour laws, particularly now that they have been empowered to enforce compliance with regard to the payment of pension fund contributions. Enforcement of the national minimum wage also needs more focus.”
Sabela stressed the unaffordability crisis workers are facing will solidify even further. “Steep fuel prices would further escalate the cost of basic goods, including food and transport, fueling inflation. Interest rates would go up, ultimately slowing economic growth.
“The proliferation of cheap imports effectively takes away jobs from the SA labour market, deepening our already high unemployment rate.”
National Council of Trade Unions (Nactu) general secretary Narius Moloto said the high cost of living “eats directly from workers’ salaries. The impact is huge and negative to the workers as their living standards are badly affected. The fuel price hike has increased the price of everything including basic foodstuffs.”
The cost of living keeps rising, but wages are standing still. Food is expensive, transport costs are relentless, and electricity tariffs continue to climb
— Fedusa
SA Federation of Trade Unions spokesperson Newton Masuku said the government must intervene to stop the jobs bloodbath and end austerity measures and the illicit trade that is killing the economy.
“We take serious issue to the proposed amendments to labour laws. These are hard worn worker rights that must not be sacrificed at the altar of economic growth,” Masuku said.
The Federation of Unions of SA (Fedusa) said: “On this year’s Workers’ Day, Fedusa stands with workers who are holding this country together under immense strain. The reality points to a painful truth. Workers are tired.
“The cost of living keeps rising, but wages are standing still. Food is expensive, transport costs are relentless, and electricity tariffs continue to climb. The massive sustained electricity increases over the past five years have negatively impacted workers in their homes and industries that are scaling down, and in some instances resorting to retrenchments to counter the above inflation increases, against the back of Eskom making profits at the expense of job creation and economic growth.”
Fedusa noted health care is becoming harder to afford: “Every month, workers are forced to stretch less and less. At the same time, job security is weakening. More workers are pushed into contract work, labour broking and informal jobs with little protection. Young people remain locked out of the economy in their millions as unemployment continues to rob this country of its full potential.”
South Africa needs a worker-centred path, it said. “One that protects wages, reins in the cost of living, supports industrial growth, and restores balance in the economy. One that treats workers not as a cost, but as the backbone of this country.”
Business Day
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