· Honourable Chairperson and Members of the
Portfolio Committee on Employment and Labour
· Deputy Minister
· Leadership of organised labour, organised business
and community organisations
· The Director General and Senior Management of the
· Members of the media
· Honoured guests and member of the public
Let me start with a question: what are the implications of the
reconfiguration and renaming of the Department? Clearly, this reflects
that the priority for this 6th Administration is jobs.
The renaming and reconfiguration of the Department reflects the
refocusing from purely labour regulation and labour relations to the
transformation of the labour market, employment and conditions of
employment. We cannot achieve this alone. We continue to depend on the
private sector to propel employment. This is why the President’s
investment drive is so important.
So let me share with you our thinking on the role of the reconfigured
First, where we can, we will leverage the resources of the Department –
and of our entities – which are our labour market instruments - the UIF
(Unemployment Insurance Fund) and the CF (Compensation Fund) – to
preserve jobs and to invest in job creating initiatives.
Second, as the Department, we provide coordination and seek to
collaborate and align our efforts with other Departments and agencies
both to create jobs and to ensure that our people get the skills
required in the market place.
Third, we intensify efforts to strengthen the labour market through the
variety of tools at our disposal and in line with the Vision of the
Department to [Quote] “strive for a labour market conducive for
investment, economic growth, employment and decent work”.
This must include doing away with red tape. However, it does not mean
reducing workers’ rights as proposed by the Opposition, which
constantly exaggerates a perception of the supposed rigidity of the
labour market. Indeed, research indicates that there is a relatively
high level of re-allocation and easy movement of labour between
In the current situation of deep systemic unemployment and slow growth,
government has to use its active labour market policies to improve
access to jobs and skills.
Let’s go to specifics.
Our Public Employment Services Branch has been allocated R611 million
rand to drive the implementation of these active labour market policies
– including providing free career counseling, retraining and
upskilling, job placing, and providing subsidies to support workers
with disabilities in employment. [This includes 13 factories, under the
Supported Employment Enterprises programme producing high quality
furniture and linen. They need to be supported by all government
structures, as well as the private sector.]
In addition, we will establish 10 specialized Youth Centres over the
coming two years – in addition to our existing 126 Labour Centres. [In
fact, we are officially launching the first of the Youth Centres at
13h00 today, nearby, at 22 Parade Street. Portfolio Committee members
are welcome to join us.]
In this financial year, we will also ensure that our passive labour
market tools - mainly the Unemployment Insurance Fund strengthen our
Labour Activation Programme to focus on the following:
· vocational and remedial training for the
· programmes for youth in transition from school to
work, including apprenticeships and some 130,000 learnerships over
· Also, subsidized, targeted measures to provide
o hiring subsidies - paid to private-sector
o Assistance to unemployed persons who wish to start
their own businesses.
o As part of transformation, funds have been
allocated to three new black Asset Management Companies.
To achieve this, the UIF has budgeted R 7.9 billion rands over the next
three years. The focus is to fund jobs, not just training.
The Department will form partnerships with employers and training
institutions – particularly in collaboration with the Department of
Higher Education and Training - to address the future skills needs of
the labour market. The President has said that we must train the youth
for the digital jobs which are expected to be created in the wake of
the Fourth Industrial Revolution.
The President has flagged the need for Social Dialogue and a Social
Compact. NEDLAC is critical to this. The Department will consult with
all social partners to review the constitution of the Council to
promote greater inclusivity. Governance challenges at NEDLAC – which
resulted in disciplinary processes against senior officials - are being
Honourable Chairperson, in October 2018, a Presidential Jobs Summit was
convened by NEDLAC. Of the 77 commitments made, 70% are on track for
implementation. I should mention that in contrast to previous Summits,
a Monitoring and Evaluation tool was put in place to track
Already these interventions have resulted in saving jobs, through the
Training Layoff Scheme, and via a sizeable investment from the UIF’s
High Social Impact Fund. R1.2 billion rand was invested in Edcon
preventing the loss of 140,000 direct and upstream jobs. I should
mention that the investment comes with strict conditions to guarantee
the investment capital and a sustainable turnaround in the
Honourable Chairperson, it is worth noting that the Ministers of
Employment and Labour in SADC have agreed to develop a Regional Labour
Migration Policy by the end of 2019. In turn, the Department will
finalise a new national migration and employment policy in consultation
with all social partners.
Honourable Chairperson, we preserve jobs by improving the productivity
and competitiveness of our businesses. Productivity South Africa, an
entity of the Department, has done sterling work in assisting SMMEs
through its Turn Around Solution Programme. The Department is currently
reviewing the funding model, so that Productivity SA can expand its
Honourable Chairperson, a stable labour market is necessary for
creating a conducive environment for investment. Recent amendments to
the Labour Relations Act address strikes or lockouts that are
intractable and violent. These provided for the establishment of an
advisory arbitration panel. The Commission for Conciliation Mediation
and Arbitration (CCMA) is responsible for implementing these
This year marks 22 years of the existence of the CCMA, and saw the
enactment of the long-awaited National Minimum Wage Act and Employment
Law Amendments, expanding the jurisdiction of the CCMA to provide
protection to the most vulnerable workers.
Honourable Chairperson, some 194,000 cases were referred to the CCMA
during 2018/19, compared to 187,000 referrals in 2017/18. This large
caseload is indicative of the failure by both business and labour to
moderate workplace conflict. Nevertheless, this institution continues
to serve a critical role in stabilizing labour relations.
Honourable Chairperson in pursuit of social justice and a transformed
labour market, the Department published the Employment Equity Amendment
Bill (2018) for public comment. The 2018 Employment Equity report
reflects that at Top and Senior Management levels, women only account
for 23.5% and 34.5% respectively, whereas persons with disabilities
remained at 1% across all sectors of the economy.
The National Minimum Wage was initially set at R20 per hour. This is
not enough to lift people out of poverty, but it is an important start,
and indications are that some 6 million workers will benefit.
Inspections, to date, indicate a high compliance rate with only 7% of
employers failing to pay the prescribed rate.
Prophesies that wholesale retrenchments would follow the introduction
of a National Minimum Wage were not borne out. An expected massive
spike in CCMA cases has not occurred. By the end of September, the
National Minimum Wage Commission will publish research into the impact
of the changes on employment, poverty levels and wage
The EE Amendment Bill will be prioritised for tabling in Parliament -
to regulate the setting of sector specific employment targets to
address the gross under-representation of blacks, women and persons
with disabilities. In addition, it will also ensure that an Employment
Equity Certificate of Compliance becomes a precondition for access to
state contracts. R1.2 billion rand has been budgeted for this
Despite carrying out 167,000 inspections during the current year, we
don’t have adequate numbers of inspectors to reach every workplace. We
rely on the activism of shop stewards and the public to be our eyes and
ears, as well as the good will of responsible corporate citizens.
During the course of this financial year, we will be adding 200
inspectors to the current team that is working to ensure implementation
of the national minimum wage. With the DM and the DG we will be
launching a blitz of inspections in the near future. Honourable members
of the Portfolio Committee are welcome to join us.
Our Inspection and Enforcement Services Branch has been allocated a
budget of R628 million for the current financial year.
Honourable Chairperson, I cannot over-emphasize the importance of
social protection in our fight against poverty. As part of government’s
entrenched labour market policy, the UIF mitigates the effects of
retrenchments. Recent amendments to the Unemployment Insurance
Amendment Act will:
· expand the coverage and period for UIF
beneficiaries from different industries such as domestic workers,
interns and those in learnerships;
· increase the income replacement rate for maternity
benefits to 66%;
· extend a contributor’s entitlement to benefits
under certain circumstances; and
· finance employment services.
Average turnaround time of payment of UIF claims has been shortened
from 10 to 7 days.
The UIF also contributes to fighting poverty and unemployment, in that
20% of its Social Responsibility Investment (SRI) Fund is invested in
high impact job creation business ventures across all sectors and
provinces. To date, almost R17 billion has been allocated to the SRI
investments, which has in turn created 23,442 jobs.
Honourable Chairperson, the recent ILO Conference resolved that
Occupational Health and Safety be elevated to a fundamental principle
Once again we face the limitations of inspection and enforcement in the
field of health and safety.
Let me mention the good work done by media in exposing the
non-compliance and failure to report accidents by employers. My
Department is processing the compensation claims of the injured persons
Earlier this year, we launched a campaign to encourage those who have
suffered workplace accidents or diseases, and where claims were not
processed, to report this to our Labour Centres. Furthermore, during
this year we will appoint an additional 500 occupational health and
Honourable Chairperson, the Department has worked tirelessly to
restructure the Compensation Fund and there have been real
improvements. We will soon present to this House amendments to the
Compensation for Occupational Injuries and Diseases Act (COIDA) to make
provision for the inclusion of domestic workers, and to fund
rehabilitation in order to return to work.
R17.1 billion has been paid out to beneficiaries by the Compensation
Fund in the last year. Whilst this mitigates the effects of injuries
and diseases, and represents a large injection into the economy, it is
also a clear indication of the failure to prevent workers’ exposure to
occupational injuries and diseases.
Honourable Chairperson, the Compensation Fund also contributes to
fighting poverty and unemployment, in that 10% of the Fund’s R42
billion surplus is invested in high impact job creation business
ventures across all sectors.
I commend the Department on its efforts to meet the annual performance
targets, with an 80% score. Building on the solid foundation laid by my
predecessors, we will continue to strengthen oversight and governance
My, thanks to the staff of the Department, the DG, and the Deputy
Minister who will present on the service delivery aspects of the
Finally, my thanks to my wife and family for the continued
In summary, our priorities are:
• Employment creation and preservation by leveraging
Government’s labour market tools;
• A labour market conducive to investment – based on
stability, appropriate skills and employment incentives;
• Social justice based on social dialogue, backed up
• Again, more jobs.
Honourable Chairperson, I therefore table the budget of the Department
of Employment and Labour.
© 2019 - The South African Department of Employment & Labour