Status of Youth and Women Unemployment: Department of Labour & Department of Women in the Presidency briefing

Meeting report

The Committee in the absence of the Chairperson Mr M Mohapi (ANC, Free State) elected Mr S Thobojane (ANC, Limpopo) as Acting Chairperson.

Briefing by the Department of Labour (DoL)

The Department of Labour briefed the Committee on its efforts in employment creation in SA, specifically regarding youth. The briefing was anchored by Mr Sam Morotoba Acting Director General, in conjunction with other representatives of the DoL present. The Committee was provided with a brief background on the DoL. It covered its vision, mission, organisational structure, legislative and constitutional mandate, its entities as well as the DoL’s Programmes. The briefing continued with insight on some of the characteristics of the South African labour market. The current unemployment rate in SA sat at 25.5%. This was exacerbated by the fact that there was a mismatch between skills acquired by job seekers in the education system against skills demanded by the labour market.  The Small Medium Micro Enterprise (SMME) sector was also relatively underdeveloped. SA was faced with the huge challenge of the ever growing shredding of permanent or stable employment being replaced by casual unstable employment. Youth employment increased from 3m in 2009 to the highest of 3.4m in 2013 and 2014.  Public employment services provided to work seekers included the registration of work seekers, advising work seekers on access to education and training, vocational and career counselling, as well as assessment of work seekers to determine their suitability. The Committee was provided with a breakdown of figures per province on unemployed youth who had been registered, provided with employment counselling, referred to employment opportunities and placed in employment (see document). Public employment services pertaining to employers included the registration of work opportunities and placement with the DoL, providing services to companies in distress by providing training on lay off schemes and social plans and also the regulation of Private Employment Agencies (PEAs) and Temporary Employment Services (TES’s).

The Unemployment Insurance Fund’s (UIF) contribution to employment creation was elaborated upon. In December 2013, the Minister of Labour had approved and launched nine training initiatives and had committed R300m for the training of unemployed UIF beneficiaries including youth. All in all about 8000 unemployed beneficiaries were targeted. During the 2013/14 financial year, training schemes which had been approved in prior years were implemented. The UIF also signed a three year funding agreement with Productivity South Africa to fund turnaround solutions. R41m had been paid to Productivity South Africa in 2013/14 and a further R58m would be paid in 2014/15. Efforts by Productivity South Africa were illustrated in the briefing document.

The Committee was also provided with insight into the Compensation Fund’s efforts on job creation. The Compensation Fund would continue to employ graduates as part of its internship programme. It was also exploring the possibility of making bursaries available to students who wished to study medical orthotics and prosthetics. This included forming partnerships with companies who provide orthotic and prosthetic services to employ such graduates.  In conclusion, the fundamental objective of the DoL was to contribute to the reduction of unemployment (particularly amongst the youth), poverty and inequality.

Discussion

Ms T Mokwele (EFF, North West) asked how the DoL carried out inspections. How did the DoL ensure that workers on Expanded Public Works Programmes (EPWP) projects were paid in terms of the Basic Conditions of Employment Act by government departments? There were municipalities who did not comply with the Employment Equity and the Basic Conditions of Employment Acts- what penalties had the DoL put in place to address this and how was enforcement monitored? On learnerships, how did the DoL assist host employers?

Mr Morotoba confirmed that EPWP projects were inspected by the DoL. The DoL inspected all sectors. Big companies and government departments were also inspected.  When there was non-compliance by companies, the DoL served them with notices. If nothing was done by the company to correct things then the notice could become an order of court.

Mr D Ximbi (ANC, Western Cape) asked how the DoL monitored its inspectors. Part of the problem lied with labour inspectors. There were many companies who did not comply with the Labour Relations Act. Many companies and businesses also had the tendency to hire foreigners as they were a source of cheap labour.

Mr Morotoba said that the DoL had 1000 labour inspectors throughout SA. This number was however still inadequate and hence the DoL relied on trade unions to do inspections as well. The DoL carried out blitz inspections.

Mr G Michalakis (DA, Free State) quoted the fundamental objective of the DoL and noted that it was failing because unemployment figures for SA were rising considering the figures from 2009 to 2013. The policies of the DoL were perhaps failing or were not being implemented properly. What did the DoL intende to do about implementing good policies and curbing job losses? In 2009, President Jacob Zuma had made an election promise to create 5m jobs and in 2014 he had promised to create 6m jobs. How much of the 5m jobs had been created.

Mr Morotoba noted that whether or not the DoL was failing on reducing unemployment was a broader question- it was not a uniquely South African problem. Many of the bigger countries were also affected by the economic downturn. The issue has been raised at G20 meetings. Economic growth could only take place if there was investment and infrastructure development.

Mr J Julius (DA, Gauteng) said that the DoL was critical to the development of South Africans. All political parties made election promises of eradicating poverty and to create jobs. The DoL in its briefing did not elaborate on its successes and failures of previous years’.  Could corruption be excluded from the activities of the DoL? In the briefing, mention was made of sectors where jobs were being created- were there sectors where jobs were created decreasing? Was the training offered by the DoL  aligned with job opportunities out in the labour market? Was the DoL involved in the Township Economic Development project as introduced by the Gauteng Premier? It was a labour intensive project - how was the DoL involved?

Mr Morotoba on the issue of successes and failures of the DoL said that the Annual Report of the DoL had been tabled in Parliament. It spoke to how the DoL and its entities performed year on year- if the Committee so wished the DoL could do a comparative analysis. On whether there were corrupt activities to date in the DoL, no definite answer could be given; however, there were isolated incidences where inspectors took bribes. The same could be said about officials that worked in the Unemployment Insurance Fund who collaborated with syndicates. Many medical doctors had lost their licenses to practise due to corruption related to the Compensation Fund.  The DoL was aligning skills with new jobs and was involved in the Gauteng Provincial Government initiative-most of the learners were sourced from the DoL’s database. 

Mr T Mhlanga (ANC, Mpumalanga) pointed out that when big companies took over smaller companies there were often retrenchments that went with it;  what was the DoL was doing about addressing the issue. The EPWP was not a sustainable programme- it was short term. What measures had the DoL put in place to make sure that persons who were trained on EPWP projects were incorporated into mainstream industries once EPWP projects were completed? What plans did the DoL have in place to ensure that co-operatives registered in provinces were being assisted? With reference to examples of power plant projects like Madupi, locals were not always employed on the projects- what was the DoL doing about this? The Reconstruction and Development Plan had stated that beneficiation should take place at local level. Seventy percent of workers needed to be sourced locally. What was the DoL doing to ensure compliance?

Mr Morotoba said that the taking over of smaller businesses by bigger businesses was encountered on a daily basis by the DoL- the issue was how the DoL worked with Small Medium and Micro Enterprises (SMMEs). The Department of Trade and Industry (DTI) provided incentives to SMMEs. It was unfortunate that sometimes SMMEs became casualties; a balance needed to be struck. On the issue of sustainability of the EPWP, one of the successes that other countries had achieved was to have exit strategies from the initial jobs that had been created. The approach of the EPWP needed to be changed- the EPWP was being reviewed. On the issue of co-operatives, it was necessary to realise that with a co-operative you were your own employer. Funds collected through the UIF and the Compensation Fund was invested in projects like airports, power plants etc. Investment agreements required that locals be employed on projects. The DoL agreed that beneficiation needed to take place. Hence the DoL was part of the inter-ministerial meeting which advised the President over the matter. Beneficiation not only covered employment but also covered the building of roads, schools etc. Mining needed to create jobs locally.

Mr Michalakis stated that in the briefing mention was made of SMMEs but the problem was that they were underdeveloped.  What was the DoL doing about it? Work in SA was moving from stable/permanent employment towards contract/unstable employment. What was happening- it seemed part of the reason was because SA’s labour laws were bad.

Mr Morotoba stated that the DoL did quite a bit of work on SMMEs. The DoL assisted SMMEs with compliance to legislation. SA’s labour laws when compared to the rest of the world were found to be flexible. If SA’s laws were rigid there would not be casual workers.

Mr Mhlanga referred to military veterans and asked how many memorandums of understanding the DoL had in place to assist them.

Mr Morotoba said there were no memorandums of understanding with military veterans but the DoL was engaging with them. A possibility was to convert old military bases into training centres. If this was done, government needed to procure goods that were produced by the military veterans.

The Chairperson on public employment services asked how many foreigners were employed compared to South Africans employed and noted in reference to slide 21 that no mention was made of quarterly implementation. What measures did the DoL have in place to deal with strikes on mines? Reference was made to funds collected by the DoL in terms of the Unemployment Insurance Fund (UIF- what happened to funds that were not paid out? What happened when a person who had paid UIF died? The Compensation Commission was a complex issue and was failing the people of SA. What turnaround strategy was being put in place for the Compensation Commission?

 Mr Morotoba said that it was difficult to track foreign workers if they were not documented. Foreigners were flocking to SA and hence the Department of Home Affairs was trying to tighten regulations. There was a prevalence of undocumented foreign workers in the security, hospitality and farming sectors etc.

The issue of strikes was huge- the strike provisions in the Labour Relations Act had been removed. In SA, 70% of workers were not unionised, the remaining 30% was unionised; the issue was therfore aboutt balancing the right to strike with the collective bargaining system. Where a contributor to the UIF died and there was a marriage certificate then the wife was entitled to the benefits. If there was no valid marriage or children then it was a problem. Regarding the turnaround of the Compensation Fund, the problems needed to be categorised. In SA, the Compensation Fund was the hugest medical aid. The Compensation Fund had reserves of R34bn. Problems came about where prices for medical costs and treatments were inflated. Another problem was middlemen; the injured party should be the ultimate beneficiary. The DoL was eliminating middlemen and was receiving negative publicity about it. A paperless process was also trying to be followed. 

Briefing by the Department of Women (DoW)

The Department of Women briefed the Committee on the status of women unemployment in SA. The briefing was undertaken by Ms Veliswa Badusa Director General. The Committee was provided with a brief background on the DoW including its vision, mission and mandate.

The DoW had conducted a situation analysis and identified certain things which it felt inhibited the economic empowerment of women. These included the lack of access to opportunities, under representation, under development, inequality and unemployment. Culture and religion, abuse and gender based violence, poverty, HIV&AIDS and unemployment also inhibited the social empowerment of women. Figures from StatsSA for the period 2008-2014 had shown that unemployment levels of women in SA was higher than that of men and even higher than the national average. The trend of a higher unemployment rate for women had been persistent for more than five years. The legislative context for the protection of womens’ rights was the Bill of Rights, the Employment Equity Act of 1998, the Promotion of Equality and Prevention of Unfair Discrimination Act of 2000 as well as the Broad Based Economic Empowerment Act of 2004. For both the economic empowerment and social empowerment of women, the DoW planned to analyse policy and identify gaps, disseminate information/advocacy, monitor the impact of government programmes and take into consideration research trends. These activities guided the strategic approach of the DoW which would in turn give rise to outputs and outcomes which would have a desired impact.

Specifically on addressing unemployment, the DoW had a programme called Techno Girl and Techno Girl Alumni which ensured that girls had equal opportunities to excel in the fields of science, technology, engineering and maths by exposing them to opportunities, supporting them to continue higher education studies in these fields and facilitating learnership internship and job placement. The DoW would also through its Gender Responsive Budgeting Initiative (tool) require departments and the private sector to ensure that they budget for the empowerment of women by indicating how much was budgeted, of the budgeted amount how much was used, of the used amount how much had reached women, of the women reached how many were empowered and in what way.

In conclusion, the DoW felt that the Committee could assist its efforts by holding departments to account on whether their budgets complied with gender budgeting principles and whether departments had plans and measures in place to ensure that their budgets were gender responsive. The Committee could also assist by conducting oversight on departments in relation to how their programmes were assisting women in achieving socio-economic empowerment.

Discussion

Ms Mokwele asked what the DoW was doing to assist widows of victims of the Marikana tragedy. Government had a duty of care towards the 34 widows. The Minister currently in the Presidency was the then Minister of Minerals at the time of the tragedy. What mechanism did the Department employ to monitor departments and sectors?  How measurable was the mechanism in terms of women representation? Even at the Committee level, there were more male members than women even though demographically speaking there were more women in SA than men. What were the DoW’s efforts on the training of women?

Ms Baduza responded that the Department of Social Development was dealing with the issue of Marikana miners’ widows. The DoW worked closely with other government departments like Health, Justice etc. So there was collaboration on a number of women related issues. 

Ms Thandeka Mxenge Deputy Director General, added that the DoW in conjunction  with the Department of Performance Monitoring and Evaluation was working on a monitoring tool. The DoW also assessed how SA performed against international instruments to which it was a signatory to.

Mr Mhlanga asked what progress had been made regarding females in mining. What were the efforts of the DoW with other departments on addressing challenges facing women? Given the restructuring of the DoW in shifting the portfolio of children and persons with disabilities away from the DoW, how was its budget affected. What was the status and budget of the Council and how did it fit in with the new mandate of the DoW?

Ms Baduza confirmed that the DoW did monitor other government departments. On specifics of women in mining, it was best that the information requested came from the Department of Minerals. From data available as at the meeting, only one woman owned a mine in SA. There was a mining charter in place which set out percentages that needed to be met.

Ms Thandeka Mxenge Deputy Director General said that the DoW’s budget was reduced given the reduction in its portfolio size. When a function was transferred, its budget was also transferred. There was a decrease in budget of R26m as well as a decrease in staff. The actual transfer of funds would happen after the adjusted budget.

Ms Mxenge said the issue of the Council was still being considered by the Department.

Mr Julius noted that slide 15 had referred to a gender response budget tool. Could the Committee be made privy to the tool? It was suggested that the DoW report annually to the Committee as this would assist with the Committee’s work. Was information on the current budget available? It would allow the Committee conduct better oversight. The development of women could not be separated from the development of the girl child in society. The starting point should be when the woman was still a girl. Was the Department compelling the private sector to budget for the empowerment of women?

Mr Mzolisi Ka Toni Deputy Director General on gender responsive budgeting responded that SA was setting a SA based framework for the private sector. The current frameworks were Canadian and Australian based. The DoW had the expertise to develop a framework. The DoW worked in collaboration with the Department of Performance Monitoring and Evaluation and National Treasury on the framework. There were some pockets of good practises on gender responsive budgeting. There would be specifics on how much money had been set aside and how many women had been empowered. On the medium term expenditure framework, gender responsive budgeting was with the Department of Co-operative Governance and Traditional Affairs to see to it that municipalities adhered.

Ms Baduza added that it was true that efforts needed to start with the girl child. Girl children needed to access education. When women complete tertiary studies where do they go? One did not see representativity in the workplace. The political will to empower women was there since 1994. Female representativity requirements had been set at 30% it had in principle moved up to 50%. It should be at 50% in senior management levels in departments. In the private sector there were very few women who were Chief Executive Officers or directors.

The Chairperson pointed out that the work of the DoW cut across all departments. How did the Department ensure that departments adhered to medium term strategic plans?

The meeting was adjourned.