The South African Federation of Trade Unions (SAFTU) on Friday condemned the South African Reserve Bank (SARB)’s Monetary Policy Committee (MPC) hiking of the interest rate by 0.75 per cent.
‘This interest rate hike takes the inter-bank rate rate from 6.25 per cent to 7 per cent, whilst the prime rate (the base rate for the consumers from commercial banks) rose to 10.5 per cent from 9.75 per cent.
In a statement SAFTU said: ‘The 7 per cent inter-bank rate rate goes beyond the pre-Covid 19 pandemic levels and has led to the base rate rising by the same amount.
‘This means, they are indeed determined to put us through the pain of interest rates as professed in the last MPC announcement.
‘But what is even more worrying, is the fact that when addressing the Wits School of Governance, Governor Kganyago said there is still more policy rate space. This means, we must expect more interest rate hikes next year.’
In previous statements, the South African Federation of Trade Unions (SAFTU) has argued against using interest rates as tools for targeting inflation.
Their statement continued: ‘It appears that the governor and his committee stretch the expression of Maslow’s Hammer, “if all you have is a hammer, everything looks like a nail”, to absurdity.
‘Despite the available knowledge stimulated by monetary policy debates across the globe, the SA Reserve Bank continue to use the regressive interest rate tools that sabotages the economy further in the context of low growth.
‘In his own words previously, the current inflation is driven by “supply bottlenecks” (whatever this means), but by using interest rates, Governor Kganyago is squeezing the consumers.
‘In other words, he is punishing the victims of inflation.
‘As noted in earlier statements, “the idling human and industrial capacity in the country is a testament that different measures other than interest rates can be used to fight inflation.
‘This inflation is not stoked by demand, but by low growth in production and supply.
‘In fact, even if it was a demand-pull inflation, to solve it, one would have to “strive to raise the production capacity to beat inflationary pressures caused by aggregate demand”.
‘The trajectory of low growth exacerbated by Covid-19 pandemic, has pushed industrial and human resources into being idle.
‘The idling manufacturing capacity sat at just over 22 per cent in June 2022, and 12.2 million people are now unemployed.
‘The unutilised capacity has been caused by a combination of factors that include but are not limited to the destruction of local industry by ‘’cheap’’ imports, the corporate investment strike for the past several years and the neoliberal policy measures that have encouraged government to cut its expenditure and divest in order to make way for the private sector.
‘Because domestic consumers are not responsible for the current flames of inflation as such, the increase in interest rates are not only punishing them by making interest on their loans and credit facilities expensive, but also by stimulating further inflation in the intermediate period.
‘This is because businesses absorb increased costs on their loans and credit facilities through pricing ie increase prices of products on consumer goods.
‘Furthermore, those small businesses whose attempt to absorb the increased debt servicing costs by passing such costs onto consumers fail, resort to retrenchments.
‘Therefore, the working class people bear the pain of interest rate hikes through increased loan servicing costs and higher prices.
‘The other element that has a hold on the behaviour of the SA Reserve Bank’s drive to hike interest rates, which Kganyago shy to mention, are the currency traders. They are engaged in the sale of currencies for the purpose of profiteering.
‘Looking to profit, they dump currencies that have low interest rates for those that have higher rates so that they can profit from the rate differentials.
‘This is the reason why the SAFTU campaigns for the defeat of capitalism, and its eventual replacement with socialism – a system based on the production for the satisfaction of human need, and not for profit.’
Meanwhile, South African Post Office workers are demanding a 15 per cent salary increase, along with a list of other demands.
Workers last Thursday kicked off their two-day strike and have urged the government to intervene and iron out issues crippling the state-owned enterprise.
The Congress of South African Trade Unions (COSATU) backed the Communication Workers Union (CWU) as its members handed over a memorandum of demands at Parliament.
Post office workers are seeking a housing subsidy of 2,500 rands. They also want a guarantee that their salaries will not be reduced and that their working hours will remain the same.
COSATU provincial secretary Malvern de Bruyn was at Parliament to support the striking workers, he said: ‘We want government to intervene and we want the CEO of Post Office to be removed. We want the ANC government to listen to the demands because, ultimately, COSATU will come out in numbers to put pressure on government.’
The CWU also want issues regarding their medical aid sorted out.
The South African Post Office’s management said that they would respond to workers’ demands once they’d assessed the memorandum.
CWU provincial secretary, Wayne Bredenkamp said: ‘This is where we are now as Western Cape, we are saying we want the CEO removed, but we are also saying that the government must pump money into the Post Office because they are the owners of the Post Office, there are no other investors in the Post Office – only the government.’
- Members of the National Union of Metalworkers of South Africa (NUMSA) marched to the offices of South Deep mine which is part of Gold Fields and is based in Westonaria demanding that the union is recognised by management.
A NUMSA statement said: ‘Our members are fed up with the management of the mine who are actively obstructing the union from being recognised and gaining organisational rights.
‘Our demands are simple. We demand organisational rights so that we can freely serve our members and defend them in the workplace.
‘We reminded the management that the right to freedom of association is a constitutional right which is guaranteed in our legislation.
‘Since NUMSA started recruiting members at South Deep, we have witnessed how the management of the mine is in cahoots with other unions, and it has consistently sought to be gatekeepers, union bashers and anti-NUMSA and against its members as it has systematically blocked the union from enjoying organisational rights.
‘We handed over a memorandum of demands to the management to demand the following:
‘1. We demand that NUMSA members be treated fairly and equally in the workplace and not to be subjected to any form of intimidation, victimisation or any workplace bullying towards them.
‘2. We are also demanding that our members’ cancellation/stop order forms from their former unions to be processed without any delays from the payroll departmental staff.
‘Our members still suffer deductions of subscriptions by the former unions even though they have submitted the stop orders indicating that they are NUMSA members and have broken ties with former unions.
‘3. It is common cause that the CCMA awarded NUMSA sections 12 and 13 of the Labour Relations Act.
‘We are aware that as management you have taken a decision to review this award and we interpret that as a delay tactic and a barricade to us getting our well-deserved organisational rights.
‘As per the award of the CCMA we are demanding that all monies deducted from our members as agency fee instead of NUMSA subscription, be paid to NUMSA retrospectively.
‘4. We have submitted more than 800 membership forms subsequent to the review award, and under a new CCMA application of section 21 Organisational Rights.
‘In the conciliation process parties could not agree. We therefore demand that we be granted organisational rights as we have sufficient representation at South Deep.
‘5. We are calling on South Deep management to unconditionally end its union bashing practices and allow NUMSA the space to service its members without prejudice as per the diktats imposed by section 23 of the Constitution which guarantees rights to fair labour practices.
‘The memorandum was received by Benford Mokoatle the Vice President and Head of operations at South Deep mines. We have given them 7 days to give us a written response.’
