Gideon du Plessis: Time for turnaround in SA mining chain of promises

Shutterstock []

There appears, in mining, to be an everlasting chain of promises by those uninvolved in the direct applications and implications, the outcome invariably falling short; Trade Unions’ word being upheld by employers as best they can, communities being let down by governmental inefficiency, albeit a good attempt by companies to fill the gap. So what is to be done? General Secretary of Solidarity, Gideon du Plessis speculates upon that very question. – CH

By Gideon du Plessis

A country and an industry where promises abound

As the annual Mining Indaba yet again ended up as a talk shop and it produced nothing of real significance, Solidarity takes a more critical look at the mining industry where “promises” abound.

The ruling party, for example, promises voters free houses, schools, medical care and numerous grants that arise from the idea of a welfare state. However, what is promised has to be funded by taxpayers and in the form of, among others, tax contributions and royalties to be paid by the mining companies. The mining companies, on the other hand, attract investors with promises of capital growth and dividends while workers have to come up with the production that has to be converted into rands and cents. Then there are those trade unions that promise their members generous increases and potential members but it is the employers who have to foot the bill for those promises made by the trade unions. Lastly, mining communities want to benefit from mining activities, and sometimes mining companies assume government’s responsibilities for service delivery to those communities but they can never meet all the expectations. The upshot is tension in the mining industry and although all stakeholders want an ever larger helping of the pot of gold and no one wants to see the pot shrinking, the stakeholders put obstacles on the path of growth, the one blaming the other for the problems encountered.

To ease the tension, the industry simply has to generate more money, and this is only possible if productivity and production are upped. The more money mining houses make the happier their shareholders are and the more there is to share with employees and local communities. Moreover, it generates more tax revenue for government to spend in the expensive welfare state we have. Expanding the pot of gold, however, requires major mind shifts as well as ideological shifts to ensure that those factors that can be brought under control are indeed controlled, leaving only external influences, such as market and currency fluctuations over which role players exercise limited control, as the only challenges that have to be faced.

What can be controlled so as to expand the pot of gold?

To get the mining industry into a growth curve, mechanisation and automation have to be implemented at those mines that lend themselves to it in order to develop a workers class that is more skilled and can thus earn higher wages that result from increased productivity and an enhanced set of skills. In collaboration with service providers the increased use of machines can present an opportunity to workers from local communities to receive training in the servicing and repairing of mining equipment. In general, skills development will enhance the dignity of entry level miners and will make them more promotable, while the employer will benefit from higher production and less labour unrest.

Although there is uncertainty as to who should be credited for coining the phrase, a crisis shouldn’t be wasted, there can be no doubt that the electricity crisis severely impacts the mining industry. However, this crisis, too, has a silver lining as unreliable electricity supply has opened the door for independent power producers and especially opportunities for coal producers. Being directly involved in the generation of electricity will offer a lifeline to coal producers, thus giving impetus to an ailing coal industry. In turn, this will boost power supply.

Other challenges, such as the system of migrant workers, also need to be addressed. Not only does the system of migrant workers place tremendous pressure on workers due to them having to often maintain two households, but it also gives rise to social decay caused by the absence of a father figure back home. Moreover, the system of migrant workers causes ethnic tensions in mining communities. Government, mining houses and trade unions have already established a task team to address the problem. This year should be the year in which those single sex hostels that still exist are converted into family units. From now on, migrant workers must also get more frequent leave and must get the logistical support to visit their families. Low literacy and a lack of specialist skills, coupled with the breaking up of families contribute directly to the high frustration levels among workers who strike and intimidate as most of them have nothing to lose.

Certain trade unions, however, exploit this volatile situation by creating high expectations among fragile workers who, because of their domestic situation, are already frustrated when they report for work and then they have to do a day’s work which requires major physical effort from them. A five month long platinum strike – which brought little to show compared with the sacrifices made and which resulted in more debts being incurred with unscrupulous micro lenders, and a sword of retrenchment hanging over the heads of workers to boot – is simply irresponsible trade unionism. Labour legislation has to be revisited to make provision for compulsory arbitration after a limited period of striking. Moreover, it should be easier to deregister trade unions that act consistently outside the spirit of the Labour Relations Act and that incite violence and intimidation.

Other controllable matters, such as the controversial amendments to the Mineral and Petroleum Resources Development Act; the majoritarian principle as it applies to trade union representivity; compliance with social and labour plans as well as with mining regulations; the indiscriminate use by the Department of Mineral Resources of suspension of production in terms of section 54 stoppages; illegal mining activities; environmental pollution; beneficiation; communication challenges between role players and the restoration of the rule of law, simply require capable leadership and buy-in from all stakeholders to ensure that South Africa is not again the only mining country in the world to miss the next commodity boom.

At the moment the choice is between a destructive, obsolete ideological and self-interested approach, which the ruling party and some trade unions subscribe to, and the creation of a mining environment based on market economy principles and the Bill of Rights, which Solidarity and most of the mining houses endorse.

* For more in-depth business news, visit or simply sign up for the daily newsletter.

Brent Crude
All Share
Top 40
Financial 15
Industrial 25
Resource 10
All JSE data delayed by at least 15 minutes morningstar logo
Company Snapshot
Voting Booth
Please select an option Oops! Something went wrong, please try again later.
I'm not really directly affected
18% - 1575 votes
I am taking a hit, but should be able to recover in the next year
23% - 2068 votes
My finances have been devastated
34% - 3086 votes
It's still too early to know what the full effect will be
25% - 2240 votes