INTRODUCTION

The year under review has been momentous both for South Africa and for Nedlac. South Africa held its second democratic election and a new President was elected by Parliament. Nedlac appointed a new Executive Director and new convenors for the government and community constituencies. These changes at both a macro and institutional level set the framework for Nedlac's activities from 1 April 1999 to 31 March 2000.

This report details the activities of Nedlac and the economic and social trends that compose the framework for these activities. While the economy continued the recovery that started in the fourth quarter of 1998, the restructuring of the South African economy continued to result in large-scale job losses in the formal sector. Approximately 80 000 jobs were lost between September 1998 and September 1999. This restructuring adversely affects people at the less-skilled end of the labour market, largely African men and women. Low levels of matric passes continue to jeopardise the entry of youth into a labour market that is increasingly demanding higher skill levels. On a positive note, enrolments in higher education, although still skewed in racial terms, are beginning to more closely mirror population distributions.

The development trends show increased delivery of services by government to all sectors of the population. In some areas, such as lowering infant mortality, this has had a positive effect. However HIV / Aids remains a serious threat and it is estimated that by 2005 over 600 000 people will be dying of Aids-related illnesses per year. Poverty and hunger remain a serious problem. Research completed by Nedlac indicates that almost 25% of all people* experience hunger once a month, whilst 57% live in poverty*.

Trade has been growing steadily as a percentage of gross domestic product since the early 1990s. Exports continue to reflect South Africa's reliance on its mineral wealth with over 50% of exports by value being accounted for by these commodities and their derivatives. However, fixed investment, both domestic and foreign, continues to remain low and undermine the long-term growth of the economy.

Within this context the Nedlac constituencies, at the October 1999 Annual Summit, identified the following priority issues:

• Taking forward the achievements of the Presidential Jobs Summit
• Actively participating in the formulation of trade policy
• Contributing to initiatives to address the crisis of HIV and AIDS in South Africa's workplaces and communities
• Strengthening Nedlac's relationship with Parliament
• Monitoring the implementation and the effectiveness of programmes, policies and legislation agreed by Nedlac and the various institutions established by Nedlac through, inter alia, developing a programme of research and information-sharing
• Continuing to build Nedlac as an efficient and effective institution for social dialogue
• Increasing Nedlac's participation in the formulation of a country position in regional, multilateral and international institutions
• Reactivating the programme of the Public Finance and Monetary Policy Chamber

Since the Summit in October 1999, considerable progress has been made towards fulfilling the priorities identified. While this progress is reported in detail in the body of the report it is worth briefly noting some areas of progress here.

The work and roles of the secretariat have been reorganised to allow the secretariat to more proactively support constituencies in monitoring the implementation and effectiveness of programmes. In this respect, Nedlac undertook a large-scale survey to assess households' experiences of infrastructure and social service delivery. The results of this research will inform the constituencies' efforts to improve the delivery of services to South Africa's people. Similarly, in January 2000 Nedlac assumed responsibility for reporting on progress in the implementation of Jobs Summit agreements. This will enable constituencies to more closely monitor and drive the implementation of these agreements.

In the year under review, Nedlac constituencies made inputs into trade negotiations both with the European Union and the Southern African Development Community. Further, constituencies participated in government's delegation to the Seattle meeting of the World Trade Organisation, thereby expanding the role of Nedlac as a national base for engagement in international policy formulation. Constituencies have agreed to undertake investigations into sectors that are potentially vulnerable under the European Union Trade and Development Agreement as well as to identify non-tariff barriers faced by South African exporters. In so doing, Nedlac will play an active role in the monitoring and implementation of these agreements.

During 1999, Nedlac played an active role in meetings of the International Labour Organisation (ILO) as well as other international and regional bodies. Nedlac's exposure in these environments has served both to champion social dialogue in the region and on the continent as well as to provide constituencies with valuable insights to inform domestic processes. Nedlac continues to play an important role in recommending the ratification of ILO conventions to Parliament and in the course of this year supported the ratification by Parliament of the ILO convention on the elimination of the worst forms of child labour.

One of Nedlac's areas of weakness has been the Public Finance and Monetary Policy Chamber that has met erratically over the past 18 months. Since November 1999, constituencies have been engaged in a series of meetings to agree upon a role and work programme for the chamber. These efforts are beginning to bear fruit and the chamber is currently considering the Pension Funds Surpluses Bill.

Nedlac continues to work towards improving its functioning as an institution of social dialogue that aims to contribute to goals of social equity and growth. Numerous meetings have been held with Parliamentary Portfolio committees, the heads of other statutory institutions as well as international bodies in order to improve the coordination between different institutions in the formulation of policy. Nedlac also initiated a programme of informal engagements on issues of national concern in order to further dialogue within South Africa.

Preliminary discussions have been held to identify areas in which constituencies can contribute to addressing the crisis of HIV / Aids in South Africa.

Nedlac has made considerable progress towards the objectives set in October 1999. The restructuring of the organisation to increase the secretariat's ability to respond to the information and monitoring needs of the constituencies will entrench these gains over the coming years.

The structure of this report is as follows:

• Section One provides an overview of Nedlac and its functions.
• The second section analyses the growth and employment performance of the South African economy. As in previous years, declining formal employment remains a central challenge facing the South African economy.
• In October 1998, the Nedlac constituencies committed themselves to implementing strategies to address unemployment. Section three reports on the progress made in implementing the Presidential Jobs Summit agreements.
• The majority of Nedlac's work programme is dealt with through the chambers and subcommittees. Section four analyses the major social and economic trends in the chambers' work areas. Of course, these trends are interrelated but this structure enables readers to see the extent of fit between the work undertaken by Nedlac and the challenges posed by the external environment.
• In addition to dealing directly with policy and legislation, Nedlac is engaged in a range of activities to promote social dialogue and understanding of the policy process. These activities are recorded in section five.
• Section six reports on the statutory obligation that Nedlac has in terms of the Labour Relations Act to consider notices of intended protest action tabled in accordance with Section 77 of that Act.
• The final section of the report provides information on how Nedlac has used taxpayers' money in the furtherance of economic growth and social equity.
• Finally, the appendix to the report provides information on the resources available from Nedlac.