By Trevor Ngwane
South African public sector unions and the government recently signed a 7.5% wage agreement, thus ending a tumultuous tug-of-war between the capitalist state and organised labour.
However, a group of unions with a minority vote in the Public Services Collective Bargaining Council are refusing to sign the deal, although it will still go through because of majority rule. Among these unions is the National Education, Health and Allied Workers Union (Nehawu), which was recently on strike. The unions are unhappy and feel tricked and short-changed by the ANC, the governing party and employer.
There is an age-old confidence trick called ‘three cards’, which has seen many a ‘Jim comes to Joburg’ character lose his money. The victim is lured into placing a bet on finding the ‘money card’ among three face-down playing cards; inevitably, he selects the wrong card and loses. The unhappy unions feel like losers and accuse the ANC government and the majority of unions who signed the deal of trickery and betrayal. So, who is fooling who? Is the wage agreement a victory for the workers? What are its shortcomings, if any?
The road that led to this wage agreement has been long and winding, with many twists and turns. It began with the government reneging on a three-year wage agreement, followed by its imposition of a 3% wage adjustment on workers, and culminating in a 10-day strike by Nehawu, which ended in defeat after it was vociferously attacked because of the disruption of public services. There was widespread opposition to the strike and the workers’ demands, including by powerful international financial institutions (IFIs).
The International Monetary Fund (IMF), a global financial institution with considerable influence, conducted its official surveillance mission in early March and concluded that the economic outlook was negative and lowered its forecast for South African growth to 0.1% in 2023. The reasons given were mainly load shedding, softer commodity prices and a rising debt-to-GDP ratio.
It warned against ‘wage bill overruns’ and advised government to reduce the public-sector wage bill. It noted how corruption, financial support for state-owned enterprises and the demands of public servants for higher wages contributed to the country’s debt burden, leading to the diversion of funds from service delivery to interest payments.
The loudest voices in the public debate appear to share the IMF’s economic and ideological outlook, venting their disapproval of the 7.5% public sector wage agreement, which is seen as deviating from the fiscal frugality that underpins the latest state budget. It is usual for some people to be unsympathetic to the plight of public sector workers during difficult economic times because they expect them to suffer like everyone else. Some voices exhibit some hostility to workers saying, ‘civil servants are overpaid, and they under-work’. Some accuse the ANC of ‘populism’ and trying to entice workers to vote for it in the coming May 2024 national elections.
The government has no money and may have to ‘rob Peter to pay Paul’, that is, divert funds from other departments and services to honour the wage increase. This argument dovetails with the fiscal discipline mantra beloved by the IMF and mainstream economists. The government is said to have a finite pot of funds from which it allocates according to a prescribed formula or set of rules and priorities. The question is, who formulates the rules? In 1999, there were mass protests in Seattle, USA, against the World Trade Organization (WTO), which spearheaded an international movement for socio-economic justice which pointedly asked this question.
The Battle of Seattle signalled the birth of the so-called anti-globalisation, anti-Neo-liberal movement that targeted the World Bank, the IMF and the WTO, which were seen as responsible for the rich getting richer and the poor poorer in the world. At the height of this movement, its activists hounded all the important meetings of these IFIs, which were accused of protecting and promoting the interests of capitalist corporations and imperialist governments. The movement saw the World Economic Forum, which meets every January in Davos, Switzerland, as the embodiment of the nexus of global corporate and state interests that perpetuate exploitation and oppression in the world.
The IMF was seen as part of this Davos ‘Mafiocracy’ of bankers, industrialists, oligarchs, technocrats, and politicians who were responsible for most of the world’s social, economic, political and ecological ills.
Historically, the IFIs were responsible for anti-poor policies, such as the structural adjustment policies that wrecked the economies of post-colonial societies; they used debt as leverage to force governments to submit to the interests of the Davos ‘Mafiocracy’, and thus, turn them into Neo-colonies of advanced capitalist states.
The collapse of the Soviet Union and attendant ideological emasculation of socialism as an alternative to capitalism opened the door to capitalist triumphalism and facilitated the unchallenged hegemony of the capitalist system in the world. Capital and the capitalist classes rule supreme despite the perennial and devastating crises of capitalism. The IMF, WTO, World Bank and the rating agencies are some of the mechanisms through which this domination is enacted and cemented.
Under the ANC government, the racist public sector, which served capital and the white population, was turned into a Neo-liberal sector that served the self-enrichment needs of the aspirant black bourgeoisie.
It was reconfigured to channel public funds into private pockets through privatisation, commercialisation and financialisation.
The Neo-liberal public sector denies public sector workers their role of providing quality goods and services to all of humanity, especially the working class and the poor. Expenditure on the wages and needs of public sector workers is denigrated and viewed as a waste of society’s resources. The ‘market’ is proffered as the solution to humanity’s problems and as the conduit for the satisfaction of all human needs.
Despite the ANC’s anxiety about losing the labour vote, the workers should remember Karl Marx’s words: ‘’This organisation of the proletarians into a class, and consequently into a workers political party, is continually being upset again and again by the competition between the workers themselves. But it ever rises up again, stronger, firmer, mightier.’’
*Trevor Ngwane is the Director of the Centre for Sociological Research and Practice, University of Johannesburg.