INTRODUCTION

PHILLIP DEXTER, EXECUTIVE DIRECTOR

The past year has been a busy one for Nedlac. Having undergone a number of changes as an institution and having been affected by the change occurring within our own society, Nedlac was in something of a quagmire at the end of the 1999/2000 period. There were voices hostile to social dialogue who even questioned the need for Nedlac. While many of its regular activities continued, as this report reflects, the Nedlac constituencies had to go through a process of engaging one another at a strategic level to determine the future programme of Nedlac. This process was necessary to ensure that the role and objectives of the institution are clearly outlined and achieved. Given the strains in the relationships between the constituencies precipitated by the socio-economic situation in the country, the focus on committing to Nedlac, to social dialogue and to a work programme aimed at reaching agreement on key issues that face the country, has been in itself a success that can be proudly recorded.

In this process the constituencies set themselves a number of key objectives. Among these were to ensure that Nedlac remained the pre-eminent institution of social dialogue in the country. This was important in view of a number of tri-partite and bilateral institutions and processes which, although a product of the institution, presented Nedlac with the challenge of coordinating the expanded social dialogue. The working releationship with these fora has been positive. The Millennium Labour Council, which was seen by some as a challenge to Nedlac, delivered a framework which was an important basis for the Labour Law Amendment negotiations.

The constituencies have also focussed on a number of key issues, the resolution and/or implementation of which have been seen as important. Among these have been the labour law amendments, the implementation of the Proudly South African campaign, the HIV/AIDS code and the Pension Fund Amendment Bill. Other issues that have been dealt with in Nedlac are detailed in the activities section of this report. The profile of Nedlac has certainly been raised and there is a clear public interest in the issues that are dealt with in Nedlac. The shift to a greater emphasis on liaison and outreach by the institution has also borne fruit in the form of stronger relationships with Parliament, with academic institutions and with greater public awareness. This remains a key focus and improving these relationships is essential for Nedlac.

The constituencies have worked hard at preparing issues for strategic engagement by clearing the agenda of the Executive Council of any administrative issues. After a series of meetings of this nature during the year 2000, the foundation was laid for the annual summit meeting of Nedlac in September of last year. This meeting, chaired by Deputy President Jacob Zuma, was the highlight of the year. The declaration adopted at the summit has set the agenda for the constituencies and has enabled a stronger strategic and proactive framework for the work programme to be developed. The summit also suggested that a less formal "4-a-side" meeting take place between the constituencies to create an environment conducive to exploring difficult issues and how these might be approached post the summit. This meeting took place in the beginning of 2001and was a marked success, demonstrating the ability of the constituencies to shift their style of work with the nature of issues.

The constituencies have continued to face peculiar challenges of their own. Labour has been under pressure due to the continuing job losses and lack of job creation in the labour market. Business has had to contend with the fact that Black economic empowerment in the form of Black business development has had limited success in changing the ownership patterns of the economy. Increasing pressures of world markets have also made the conditions for business more competitive. The Community constituency has had to reflect on its own composition and role and the fact that the many weaknesses of the constituency have limited the effective participation of the member organisations. Government has had to live up to the sustained and increasing pressure for visible change and delivery.

Despite these challenges the constituencies have acquitted themselves well. Each has sought to deal with their particular challenges and has attempted to channel positive energy into Nedlac in a situation where they themselves are often overstretched. There has been increasing interest from other organisations to participate at Nedlac with no fewer than 4 organisations sending formal applications to Nedlac. These are currently being processed.

The Nedlac constituencies have engaged through this period in a particular social and economic context. As this report reveals, the social conditions created by the years of apartheid and before that the colonial encounter have left what sometimes appears to be an indelible stain on our society. The resultant social backlogs continue to be the most pressing issues confronting our society, with unemployment and poverty the key of these. Debates on how to address these will continue. The challenge before Nedlac is to give expression to these debates and to create concrete participatory processes and efforts aimed at speeding up addressing these issues. The economy has not been without its own peculiarities. Despite the macro-economic balance and a general sense of stability and well-being usually characterised by the expression "the fundamentals are in place", growth has not been at the levels that the economy requires to ensure development takes place at the minimum pace required. Nedlac has had to put continued emphasis on ensuring constituencies focus on how they can contribute to economic growth and ensure that it reaches levels that allow for the legacy of the past to be overcome.

As a result of the concentration of the Executive Council on strategic matters, the Management Committee has played a more hands-on role in running the institution. This has borne fruit in improvements in financial systems and administration and in coherence within the secretariat. This has been particularly important in the face of a high staff turnover rate.

The secretariat of Nedlac has undergone some radical personnel changes. In many ways the end of the first period of Nedlac's life was marked by the general election of 1999.The staff that left the institution just prior to the election and soon after, represent an important part of the institutional memory of social dialogue in the country. New staff have had to be trained rapidly and weak financial and administrative systems strengthened at the same time. This has put pressure on the secretariat, but it has tried to meet these challenges in a consistent manner through regular work sessions aimed at resolving these problems. A greater emphasis has also been placed on staff training.

There can be no doubt that the year ahead will be a tough one for Nedlac. The Labour Law amendments need to be finalised, there is looming conflict over the issue of privatisation and the job creation capacity of the economy seems not to be improving. Despite these challenges, Business and Labour confidence is good, as evidenced in the Millennium Labour Council agreement. Government is committed to engaging constituencies in Nedlac, and there has been growth in the Community Constituency. There are positive signs in the willingness of the constituencies to engage constructively on issues such as trade policy, industrial policy and many other issues. It is this continuing effort at social dialogue that can and must unlock the potential of our society and make it a society that takes care of its most precious resource, its people.