Government constituency speech by Tito Mboweni, Minister of Labour

Deputy President Thabo Mbeki, distinguished guests, ladies and gentlemen. Introduction It is logical that on this, the first summit of Nedlac, we should be compelled to takestock of our achievements, failures, problems and difficulties. Nedlac is a unique body inour society and has raised the expectations of many that we will achieve major agreementswithin the short time of Nedlac's existence. We have to acknowledge the lessons we havelearnt during this period.

Recently, I have made public my views about the difficulties in Nedlac. These commentswere not meant to suggest that Nedlac's difficulties were of such a nature as to renderthe organisation unimportant, but rather to underscore the fact that we are most probablyentering a new phase in the life of this organisation. I have reiterated the commitment ofthe government to the basic approach of social partnership as the fundamental point ofdeparture. I noted that the active engagement of all of us in considering and negotiatingmajor social and economic policies affecting the country, is key to our success.

I will not dwell on these issues any further. Rather, I would like to emphasise theneed for us, in taking stock of our experiences over the past year, to reassess ourcommitment to the preconditions for successful social partnership, in order to reaffirmthem and to have them guide our future behaviour and approach to Nedlac processes. Moreimportantly, I would like to call the attention of this summit to the gravity of theeconomic and social situation which confronts us as a country, and to the fact that aprincipled approach to social partnership in policy formulation and implementation is animportant mechanism of decisively resolving these issues.

Political context

Deputy president, all institutions are historically specific. They are designed to fitthe requirements of particular historical moments and are rarely perpetually relevant andappropriate in dramatically changed or changing circumstances. In the dynamic global anddomestic environment in which we live, an institution which is unable to adapt itsstructures and practices to rapid change runs the risk of withering away or, worse still,it may become an obstruction to the transformation process.

What are the circumstances under which Nedlac emerged?

Firstly, Nedlac emerged from the realisation that neither business nor labour, andneither government nor the others partners, could afford an approach which excluded othersfrom effective participation in major policy processes. Thus a common need was identified,which was seen to be of such a nature, given the economic, political and social crisisfrom which we were emerging, as to demand a collective response, in particular frombusiness, labour, community-based development organisations, and the democraticgovernment. It was felt that in our collective endeavours, we were better placed to effectthe fundamental transformation of this country.

Secondly, we all felt the absolute necessity of ensuring that whatever cooperationthere had been during the apartheid period, needed to be maintained but transformed into amore coherent one in keeping with the new democracy and our common commitment to ensuringconsultation and joint decision-making on key policy issues affecting all of our people.Cooperation had begun to emerge when the restructured National Manpower Commission (NMC)and the National Economic Forum (NEF) came onto the scene.

The NMC had been restructured following the Laboria Minute to ensure effectiveparticipation by key stakeholders, but was focused mainly on labour-market issues. It wasan advisory body involving only business, labour and the Department of Manpower, as theDepartment of Labour was referred to then. Whatever its weaknesses, and there were many,it managed at least to bring together a higher level of leadership from the participantsand planted the seed for social partnership. There was a specific protocol on labourlegislation which required that such legislation had to be agreed at the NMC first beforethe minister responsible could introduce such legislation in Parliament.

The NEF, whose origins, crudely put, were in the strike called by Cosatu and supportedby the ANC and other anti-Vat organisations, to protest against the introduction of Vat.The strike was so successful that a demand was made for the establishment of a"macroeconomic forum" to consult on economic policy. In a sense, the democraticmovement sought to take some power away from the then government, which for all intentsand purposes had become a lame-duck government.

Thus the nature of both the NEF and the NMC was twofold: to force the government of theday into consultation on policy, and, more importantly and significantly, to render itunable to pursue any policies of its choice in the relevant areas. This strategy wassuccessful.

With so many years of struggle against authoritarian rule, and having designedstrategies to weaken that oppressive system, we proceed to design an institution which,although bringing into the picture the vision of the democratic movement of consultationand joint decision-making, was to a large extent still influenced by the desire to curtailthe powers of government and ensure that government could not move without the agreementof the participating parties. We probably moved to establish the new institutionalmechanisms for consultation and agreement-making without taking full cognisance of theradically changed political situation in which a political organisation from thedemocratic movement had such a massive mandate to govern. In a sense, we proceeded in thesame old way but made additional requirements to the previous NEF and NMC, given theoverwhelming enthusiasm of all of us to engage in transparent policy-making.

But there is another critical point in this. Ours is a transformation of majorrevolutionary proportions. That we have achieved our transition in a relatively peacefulmanner and in considerable unity is a monumental tribute to the people of this country,including business, labour and community organisations. It is also a tribute to thepolitical leadership of the country. But no one should be lulled into thinking that thismeans that it is Òbusiness as usual. We are going through a process of fundamentalrestructuring and the constitutional transformation has to be mirrored very rapidly ineconomic and social development. The extent to which these objectives can be achieveddepends, among others, on the pace at which transformation is effected. Time lost as aresult of indecisiveness can extremely weaken and endanger the democratic project in themedium to long-run. Within the context of social partnership, success depends criticallyon the spirit with which the parties to the process approach this urgency fortransformation. Indeed, each one of the participating parties in Nedlac should on theirown do an introspection as to whether, by their actions or omissions, they have retardedor are quickening the process of transformation.

Deputy president, our considered view on these matters is that the parties to Nedlacneed that introspection as a matter of urgency. We cannot proceed in the same manner inwhich we did prior to this summit. We must seriously and urgently change gears, takinginto full consideration the changed political situation, the constraints and opportunitiesof globalisation, the extremely dire conditions in which our people live, and thevolatility of our economic situation. The parties to Nedlac have to realise and acceptthat these changed circumstances require a different approach to the one used during thedays of the NMC and NEF. We are in a completely changed environment. And we still needeach other to succeed!

Nedlac's agenda

Deputy president, ladies and gentlemen, the Nedlac process has indeed been a busy one.Despite some difficulties from time to time, which have been pronounced upon, people havebeen working hard at Nedlac. But I am not certain that we have been working smart enough.

As the summit will have noticed from the report of the Executive Director, the agendaof Nedlac has been wide-ranging, covering almost every aspect of social, economic andlabour policy. There are a few agreements which have been reached but, given the largenumber of items on Nedlac's agenda, our success rate is average or actually below average.It should be clear that this is an issue upon which a concentrated effort must be made ifwe are to live up to the expectations of our time. In this regard, Nedlac may wish tofocus on a few issues and deliver agreements on those, rather than go on and on pursuing agrand agenda, some of whose items really do not require such lengthy deliberations inNedlac.

If we were asked a question as to what the critical challenges facing South Africa interms of Nedlac are, our likely answer would be: long-term investment, jobs, pricestability and housing. We would most probably proceed to argue that the greatestcontribution which Nedlac could make towards the realisation of these objectives is tourgently reach a fundamental agreement on all these issues, for they are interrelated andrequire a holistic, binding and well-sequenced national agreement. It would then make alot of sense for us to set up a mechanism which would help in the planning, research,coordination, negotiation and finalisation of the proposals to achieve such a nationalagreement in the shortest possible time.

How we go about our business at Nedlac is significantly influenced by what we choose tofocus on. For example, the minutiae of legislative drafting is not appropriate to Nedlac.Nor must Nedlac become overly bureaucratised; it must be nimble and capable of rapidadjustment. This is the very antithesis of ponderous procedures. We accept fully, though,that structures and rules are important. But they must not overtake the purpose of theorganisation.

Conclusion

The forthcoming planning meeting of Nedlac may wish to consider some of the issuesraised here. On behalf of the government delegation, I would like to reiterate that wewill, once again, give our full support to the holding of such a planning meeting as soonas possible. Such a planning meeting may also wish to consider whether we have actuallybeen correct in the way in which we designed the Nedlac Act.

The nature of our new environment demands that we not only make demands of governmentbut that we pursue, in our view certainly, a dialectical approach to consensus-seeking. Itis correct for business, labour and the community-based organisations to make inputs intopublic policy. But this cannot continue to be a one-way street.

Deputy President, part of the problem, perhaps, is in the way in which we drafted boththe Nedlac Act and the way in which we have proceeded at times to give a far more generousinterpretation of the Act beyond what the Act actually says, the latter being the outcomeof genuine enthusiasm about making partnerships work. To be specific on the former, theNedlac Act imposes obligations on government to bring "all significant changes tosocial and economic policy" to the table "before it is implemented or introducedin Parliament". The danger of creating a lame-duck government is real in terms ofthis. Government is specifically called upon to engage on its agenda with the partners.But the other components of Nedlac are not obligated to bring to the table anything beforethey "implement" or "introduce" anything to their boards of directorsor congresses. There is thus an imbalance here.

The processes should feed into one another. For example, why should it be correct forthe community-based organisations to input into housing policy and yet leave the samemeeting to organise a bond boycott? Why should government provide information on its plansand have these negotiated at Nedlac, and yet there is never any discussion of labour'sforthcoming collective-bargaining demands or business's decisions on investment andpricing or, indeed, the community organisations' plans in connection with the nature oftheir demands and actions? Surely, all of these have an impact on macroeconomic policy anddevelopments. And business needs to reflect creatively upon its contribution to socialpartnership and economic coordination. Business decisions impact massively on all aspectsof our prospects. We recognise that these are also commercial decisions that are notalways appropriately handled in participatory structures. But business cannot simply say,"You, through your deliberations, provide us with a suitable environment and then thefruits of our action will trickle down to you", and yet demand to be involved in verysensitive budgeting processes during which, in all probability, extremely valuableinformation is passed on. Greater certainty is demanded if the process in which we areengaged is to work.

Within the context of an ever-changing domestic and global economy, we cannot beoblivious to the impact which our actions or indeed silence as partners have on thevolatility of our economy. When the rand is under pressure, what is the role of all of usto ensure stability in our markets? I am certain that there must be a role for we cannotproceed as if nothing is happening. If we proceed as if nothing is happening, we may notbe worthy the trust which our constituencies have bestowed on us. Worse still, we maystand accused of "fiddling whilst Rome burns". It does seem that the manner inwhich we have handled these issues has, to use a political cliche, been too mechanical. Ithink the time for a bit of a dialectical approach has come. It is only if we do that,that we can truly speak of social partnership.

Deputy President, ladies and gentlemen, I conclude by urging that we think seriously oftaking a new direction in the manner in which we conceptualise Nedlac and tackle theissues before the country within the context of the need for us to effect rapid andsustainable transformation. In other words, as we depart from this summit, we should thinkseriously about the re-conceptualisation of Nedlac in order to ensure effective agreementand consensus-making systems.

Furthermore, the popular representatives of our people, the parliamentarians, have madeit clear on numerous occasions that they would like to play a role in the Nedlacprocesses. They are not clear themselves about what their role should be. Nevertheless, ifwe are to avoid the accusation that Nedlac is making these, the representatives of ourpeople in Parliament, to become mere rubber stamps of our decisions, it seems that we haveto look into this issue seriously. We would, therefore, propose to the appropriatestructures of Nedlac that a working group be set up to look into this matter as a matterof extreme urgency and report to the next Nedlac Executive Council meeting.

We express our confidence and gratitude to the Nedlac staff headed by the ExecutiveDirector and hope that despite the many difficult hours of work we have collectivelyextracted from them, they remain committed to serving this organisation. We certainlypledge our continued commitment from government.

I thank you very much.