SA needs 'authentic' mining industry

2012-09-03 10:53

Johannesburg - The South African mining industry needs to achieve transformation goals faster to achieve authenticity, Mineral Resources Minister Susan Shabangu said in Johannesburg on Monday.

"I cannot emphasise enough that unless the mining industry can claim its legitimacy to all its stakeholders, namely investor(s), workers, host communities, host government, etc, it cannot claim its authenticity," she said in a speech prepared for delivery at a New Age business breakfast in Sandton.

In South Africa, those involved in the mining sector had worked hard to keep the industry competitive while implementing transformation measures, but areas of concern remained.

These concerns needed to be addressed to root out historic problems.

Shabangu made reference to the recent violent confrontations at Lonmin's Marikana mine, where police killed 34 people and wounded 78 in a clash on August 16.

"Whilst we acknowledge the significance of the Marikana ordeal, it is apt for the industry to have a conversation about the underpinnings of such a problem, anticipate other potential challenges, and recommend a concrete plan of action that will ensure responsible action from all stakeholders."

She said there was a need for greater attention to health and safety matters, particularly in gold and platinum operations.

The migrant labour system remained entrenched in the industry, which resulted in the workers leading "dual lives" and the areas where they came from usually did not benefit.

Large wage disparities prevalent in the sector were also of concern, she said.

"To what extent is this likely to threaten not only the very democratic gains of the past 18 years, but sustainability of the very mining industry in South Africa?"

Shabangu said the government was working on a "one-stop shop" approach to licensing requirements for mining, to correct the fragmented approach now in use.

"We need to build a mining industry that cares, a mining industry that is proud to be part of the transformation agenda of South Africa, because transformation is... not just a compliance issue."

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  • loo.steyn - 2012-09-03 11:17

    Can anyone tell me if the Lonmin miners are looking for R 12, 500.00 min wage across the board or whether it is for drillers only. Secondly ,, Mining is a very sensitive economy ie. I just do not know how they will veer be able to afford R12,500.00 minimum wage across the board if that is the case

      Jo.Davies123 - 2012-09-03 11:35

      Solidarity auditted their wages last week. It was reported that there were a lot of minors taking home up to R16 500 a month. Those that were taking home the reported R4 500 had instances of high absenteeism and garnishee orders.

      Rabbler.Rouser - 2012-09-03 12:52

      Shabangu's speech is just generalized waffle completely lacking in any specifics. She just throws in a few words like 'authentic' or 'transformation' just to make it look a little credible. Transformation? Into what?

      claudia.meads - 2012-09-03 14:32

      Jo.Davies123 Adjust the R16 500/month with the productivity in SA - some of the lowets in the world - and the workers in SA's mining industry are the best paid in the world. Anybody who invests in the South African mining industry is an idiot without any known equal. Behind all of the current turmoil in SA's mining industry are people who want the sector in SA to be completely destroyed - then they can casually stroll in and mop all of it up for a ... steal... Let us see if they succeed - in the interim expect the only victims to be honest hard-working people.

      koos.meyer.52 - 2012-09-04 10:25

      I have it on good authrority that this stupid cow at the Mining Expo in Ausraila last month spent 4 out of the 5 days shopping and only attended on the final day when she made a ridiculous speech. SA does nothing to encourage investment, actually they do just the opposite!!! Investors owe us nothing, when will this get through to Govt's thick skulls? The rest of Africa has become far more attractive for investors...

      koos.meyer.52 - 2012-09-04 10:28

      Another things, Govt effectively ownes 28% of all companies in SA (before shareholders see a cent)for doing nothing - something called Income Tax. Add 15% dividend tax to that and it's well into the 30's!

  • jan.human - 2012-09-03 11:23

    Transformation??? Transforming into a third world country.....

  • Andre - 2012-09-03 11:23

    The laws that govern mines are already so strict that mining companies are too afraid to appoint mining workers. Companies are very strict on corporate governance and the compliance thereof. What more do you want? Perhaps all mines should be handed on a plate to blacks and then there will be no more mining left in SA!

  • gordon.turner.37 - 2012-09-03 11:25

    there will always be the lowest paid workers under ground digging holes in tough conditions and regardless of what they earn, it will never be enough. So, pay the miners more and chances are they will educate their kids out of the occupation and then the next wave of unskilled cheap labour will be digging the holes. What no one seems to understand is that we are no longer the only place with great wealth in the ground. Mining is a dying industry in SA and soon nobody will be prepared to fund any hole digging.

  • loo.steyn - 2012-09-03 11:29

    Another HUGE concern is the communists within government that try and dictate to capitalism based economies .. such as mining. The problem we have .. even if govt. wants to be socialistic, communistic in its approach . .the industry competes in a capitalistic environment. This means that productivity .. profitability .. efficiency etc. have bearing. When will the avg politician start understanding that profit, turnover and cash-flow are three completely different issues. Also politicians ,, please go and google Gross profit vs nett profit. And please do not forget the third ie. Nett profit after tax.

  • anthonycharles.williams - 2012-09-03 11:31

    what, to steal the mines?

  • susan.pretorius.31 - 2012-09-03 11:40

    Why isnt the goverment concerned about chinese factories that is build with materials from China, and workers from China. They are stealing jobs from our own people, and not benefitting our economy at all, and that is with our goverments blessing...

  • keith.gass.16 - 2012-09-03 11:46

    When it comes to mining it is a new world out there. How we in SA deal with the challenges is the real issue.

  • BigChiefPlumbPudding - 2012-09-03 11:49

    To me the difference in Salary between the top bosses and the physical labourer are too high, and I think this extends to many other business sectors. Just as an example, if a miner earns R 10 000 a month, and the top managers let's say 10 or 20 times more then the 'gap' is too big. A small percentage of the Salary of the top earners can go a long way to alleviating that massive difference and give the lower income earners huge relief. At what point does seeking a good Salary for your education, knowledge and experience go beyond the 'reasonable' and become pure greed?

      BigChiefPlumbPudding - 2012-09-03 12:42

      @ Clinton. I certainly stand to be corrected, but just remember we often hear of the huge salaries (yes in the Millions) of top executives in big business. As a generalised statement, I honestly feel that the gap between the top earners and the labourer is simply too big. I'm no expert on mines, just commenting in general.

      breinlekkasie.dodelikegif - 2012-09-03 13:06

      Well the average income in South Africa is round about R3500 a month. Are you prepared to go to your boss and ask him/her to adjust your salary so that it is inline with R3500 a month? I did not think so!

      BigChiefPlumbPudding - 2012-09-03 13:35

      @ Breinlekkasie - no I wouldn't on my salary, but if I was one of these executives earning millions, then yes. Perhaps you wouldn't be prepared to do so?

      gail.hayesbean - 2012-09-03 19:04

      I agree with you in principle here, however it is important to look at this holistically. The Directors and CEO's and top end of the mining industry are frequently highly educated as well as connected and experienced in running such a complex venture as mining. These people are thin on the ground and need huge incentives to accept the responsibilities that come with the position. The minErs who work at the rockface are in oversupply. i understand that it was a particular sector which was demanding R12,500 p.m. across the board out of a workforce of 27,000 at Marikana.let us say there were 6000 of them who had been attempting to communicate with the top echelons CEO's and Directors who have to deal with the shareholders and investors in a fragmenting global economy. Looking at the Lonmin site there appeared to be between 8 & 10 of these bosses. I have no idea how much they earn p.m. perhaps R100,000 just to make it simple. They won't all earn the same but here we have 10 X 100,000 = R1 million Divide this by 6,000 (no of miners demanding increases). Do the maths yourself. Each job be it as a tea woman a miner or a CEO has importance and individual stresses etc. and believes their job is more important than everyone else's. Survival is why we work and incentive is food and water etc. If one removes incentive i.e. money then why would the skilled people bother to work, raise capital for cost of materials and so on. Do we need them?Is Angie Motshekga doing a good job?

      janet.pretorius1 - 2012-09-04 08:22

      Absolutely agree. @fannie.mashilo - "Cruelty of capitalism"? Try the greed and stupidity of capitalism. It has become as unbalanced as communism - doesn't that give anyone a clue! Is anyone on these forums old enough to remember 13th cheques and 10 - 15% increases !?!

  • judith.taylor.56 - 2012-09-03 12:47

    Dear Minister why are you not using the legislation to enforce the compliance of mining companies with their contracts under the licences you grant? I hold you directly responsible for the appalling situation in the mining areas.

      koos.meyer.52 - 2012-09-04 10:31

      What about the taxi industry that has ZERO safety standards and pays ZERO income tax?

  • breinlekkasie.dodelikegif - 2012-09-03 12:53

    It's easy, retrench the drillers and replace them with robotic equipment. That way the will remain safe and unemployed. What is up with this transformation thing? Why is it so bloody difficult? Anyone can buy shares on the open market. Go forth, buy shares with the union membership fees of these workers and soon they will own the controlling shares in most mines. That way they will own the bloody mineral rights as well. Why is it so difficult to understand this? No, we would rather be both lazy and stupid!

  • pieter.haasbroek - 2012-09-03 12:58

    Authenticity? I'm probably just too dumb to understand the relevance of this word as used in this speech. I wonder whether Shabangu understands what she said.

  • aj.coetzee.9 - 2012-09-03 14:20

    Disparity in income needs to be compared to market rates for scarce skills. Just like municipal managers earn 1 Million in Salary plus Car/House/S&T allowances Mine Managers earn their money through their experience, qualifications and years of service to the country. 1 person can earn 1 million rand a year for sure considering the responsibility and job requirement. if you drop the salary good people will go elsewhere and your workers will be exposed to a worse working environment and less job security. all this talk of black and white is rubbish. The reality is you need great managers, brilliant financial planners, excellent production planning etc etc. or it will all go pear shaped and the country will suffer.

      janet.pretorius1 - 2012-09-04 08:29

      Mmmmm .... market related! And the big boys with all their education and experience are exactly the one's who go into big business in developing countries - pay barely livable wages and drive the wages down in those countries - so that the new low wages become the "market" rates. Maybe it's time for these big boys to shove their greed and power hungry approach where the sun doesn't shine and start using all their skills and experience etc to prevent the "French Revolution". They are after all the new royalty.

  • brent.bartlett.98 - 2012-09-04 09:40

    Maybe a R 12500 minimum wage is a little unrealistic given where the economy is, but nowhere is the difference between the rich and the poor more evident and stark than in the mining industry in South Africa. While drillers and those that go into the shafts daily to bring out the minerals are earning peanuts engineers and mangement are earning salaries that I find hard to justify. So we are paying our engineers and management exhorbitant salaries on a level that you see in other countries like Australia, but our miners are not getting anywhere near what their counterparts in a country like Australia get paid. South Africa needs a new product. With the costs of electricity rising so sharply mines are finging it difficult to operate in this environment so it is easier to exploit miners to keep costs down). But we need to find a new product - maybe less importing and the development of more products locally like we did years ago?

  • brent.bartlett.98 - 2012-09-04 09:46

    Responding to Claudia Meads:"Adjust the R16 500/month with the productivity in SA - some of the lowets in the world - and the workers in SA's mining industry are the best paid in the world." How many of you have noticed tha the price of food went up over 12% this last month? How many of you noticed that the price of maize meal, a staple went up over 25% this year. On a salary of R 24,000 per month it's tough enough. But what if you only earn R 3400 per month. How hard does that bite. Two things need to be looked at in this country: Lifting the scale of ecoonomy slowly towards a first world model (or we will continue to slide towards third world economy poverty as we are) and education of the masses in the area of developing a good work ethic. Then maybe we will see progress.

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