Address at the Launch of the Millenium Labour Council, 7 July 2000

Chairs of the Millennium Labour Council, Zwelinzima Vavi and Leslie Boyd,
The Minister of Labour, Mr Membathisi Mdladlana,
The Director of the International Labour Organisation (ILO), Mr Ken Andoh,
Deputy Governor of the Reserve Bank, Gill Marcus,
Representatives of Foreign Business Chambers
Business and Labour Leaders,
Distniguished Guests

In 1937 Franklin D. Roosevelt made the following statement which I believe is still relevant to us today:

"I see a great nation, upon a great continent, blessed with a great wealth of natural resources. Its ... people are at peace among themselves; they are making their country a good neighbor among the nations.

I see a... (country) which can demonstrate that, under democratic methods of government, national wealth can be translated into a spreading volume of human comforts hitherto unknown, and the lowest standard of living can be raised far above the level of mere subsistence.

But here is the challenge to our democracy: In this nation I see tens of millions of its citizens -a substantial part of its whole population - who at this very moment are denied the greaterpart of what the very lowest standards of today call the necessities of life.

I see millions of families trying to live on incomes so meager that the pall of family disaster hangs over them day by day.

I see millions whose daily lives in city and on farm continue under conditions labeled indecent by a so-called polite society half a century ago.

I see millions denied education, recreation, and the opportnity to better their lot and the lot of their children

I see millions lacking the means to buy the products of farm and factory and by their poverty denying work and productiveness to many other millions.

I see one-third of a nation ill-housed, ill-clad, ill- nourished.

‘It is not in despair that I paint you that picture. I paint it for you in hope - because the Nation, seeing and understanding the injustice in it, proposes to paint it out. We are determined to make every .... citizen the subject of his country's interest and concern; and we will never regard any faithful, law-abiding group within our borders as superfluous. The test of our progress is not whether we add more to the abundance of those who have much; it is whether we provide enough for those who have too little."

Today’s launch of this Millennium Labour Council is a bold stroke, aimed in Roosevelt’s words at ‘painting injustice out’. We commend this independent initiative by top business and labour leaders who are determined to begin the new millennium in problem-solving mode. Its formation bears witness yet again to the capacity of South Africans to find innovative ways of addressing seemingly intractable problems.

Business and labour leaders identified two critical matters facing the country, when agreeing to set up the Millennium Council, namely that:

"Unemployment, job losses, and lack of job creation constitutes a deepening crisis requiring urgent action. And 2) current levels of poverty and inequality are unacceptable and require new initiatives to promote improved quality of life and decent work for all."

This statement may appear unremarkable. This is not so: the agreement on what constitutes the core challenge facing our society provides a profound basis for a new relationship between parties who have historically been on different continents, philosophically speaking. The parties may still have differences in their analysis of these problems, and their solutions. But this initiative is an important step on an exciting journey.

It is worth noting at this point that the ILO, which supported and nurtured this initiative, has identified the issue of social dialogue to be a major plank for its international programmes. Lasting accords arising from such discussions require that real solutions that benefit society as well as the parties directly involved are found. The notion of a ‘win-win’ solution may appear to be a chimera in our context, but the experiences of post war Europe, the US New Deal, amongst others, demonstrate that situations, which appear almost hopeless, can be turned around if parties adopt a long-term vision which goes beyond the realm of their narrow interests.

The significance of the Millennium Labour Council lies not so much as an institution of negotiation. For that we have Nedlac. It is rather a forum to explore innovative solutions at a bilateral level, a think tank, which is designed to allow parties to explore options, and to build consensus. It allows parties to filter ideas, and engage in open-ended dialogue.

The Millennium Labour Council suggests the formalisation of a bilateral relationship between business and labour, which has developed over many years, and a maturation of that relationship. It reflects an appreciation of the fact that we need to find new ways to address the urgent demands of our society.

The history of adversarialism and conflict between business and labour masks important areas of common ground. In the first instance, the destiny of both parties is bound up in the future of one economy. Secondly social dialogue in South Africa has a rich history. At a time when the PW Botha regime seemed intent on plunging our country into total conflagration, business and labour were able to get around the table, despite their differences, and use various channels to move our country forward. Out of these experiences emerged institutions of social dialogue, including the National Economic Forum, the restructured National Manpower Commission, and ultimately Nedlac.

The reality of South Africa is that we have hundreds of negotiations and problem-solving interactions taking place on a daily basis in our industries, shops and mines. For every strike we read about in the press, there are numerous settlements, which go unnoticed. The many thousands of experienced shop stewards, and employers with experience of negotiations are an invaluable store of human capital, which is indispensable if we are to move our country forward. This is a positive legacy, which has emerged out of our past, which we must nurture and develop. One significant weakness, which is now being addressed, is that some key leaders have not actively participated in the social dialogue.

The Millennium Labour Council corrects this, by bringing together the culture of social dialogue at a national level, building on the experience of Nedlac, and ensuring that the key decision makers are actively involved in that dialogue.

It would be naïve to believe that the Millennium Labour Council will end the differences between labour and capital. It is an important initiative however to transcend these differences by building a shared commitment to transform our country. It suggests to the world that South Africans, and in particular two of the major players in the economy (the third being government), are beginning to build confidence in their own economy.

We believe that this initiative advances our objective of social and economic reconstruction and lays a basis for business and labour leaders to commit us enthusiastically to seek creative solutions to common problems, particularly those concerning the economy. I refer to questions relating to increasing investments, job creation, labour market, etc. We require solutions that both create more jobs and more wealth while simultaneously taking on board the concerns surrounding job security. This is a challenge that the social partners have to take up with greater resolve. We consider that the rapid implementation of reforms such as the skills development strategy and employment equity is critical to unleashing the productive potential of our people. We need to build on the major successes we have achieved in constructing a viable framework for addressing grievances and resolving disputes.

The challenge to the Millennium Labour Council is to identify strategies and instruments which will enable organised business and organised labour to bring their considerable power and organisation to bear on the two objectives identified by the Council as being their prime target- reducing poverty and inequality; reducing job loss and raising the levels of employment. At the 1998 Presidential Jobs Summit commitments were made by both sectors. We need to build on that commitment to address the social deficit our country has inherited.

A critical question, which needs to be addressed, is the matter of massively expanding productive investment by South Africans in our economy. Despite accelerated economic growth after 1994; the growth in Gross Domestic Fixed Investment (GDFI) has been slow. As South Africans we must find ways of saving more and investing more so as to generate more wealth and create more jobs.

Government has reduced corporate tax, and adopted a range of other economic policies to promote investment. It is against this backdrop that the Millennium Labour Council will have to discuss the concept of a broad economic accord, which channels the countries resources into productive investment, employment creation, and infrastructure. It is our belief that a central element of such an accord must deal with the question of investment.

Some trade unions have proposed that a certain portion of the savings of their members invested in retirement funds should be directed for the purpose of social investment. Is this not a matter that the Millennium Labour Council should be examining? Including whether government should create a vehicle, such as a Reconstruction Bond into which such investments could be channelled. Business through its control of the financial sector, and labour, in terms of its access to union investments, need to begin to look at how they apply their access to capital to meet the objectives of the Millennium Labour Council. It is not government’s task to prescribe to these parties what they should be concluding. But we would be delighted if they addressed these issues.

It is only through working together in a common project such as this Millennium Labour Council, that we can end the impoverishment of our people and that our national wealth can translate into a better life for all.

I thank you.