Nedlac fights for relevance and renewal

Does it still have a role to play? Research shows it is being undermined by government, business and labour.

Nedlac seems to have slipped from the headlines in recent years. It still exists, but it’s relevance as a consensus-seeking body between labour, business, government and communities is a shadow of what it once was.

The National Economic Development and Labour Council, or Nedlac, was created by an act of parliament in 1994 to promote economic growth, provide inputs into economic decision-making and seek consensus between labour, business, government and communities on social and economic policy.

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Those who participate in its various forums hold it in fairly high regard, but new research by Dr Ongama Mtimka from Nelson Mandela University suggests that while Nedlac remains relevant, its decision-making is frequently by-passed by government, labour and business.

There are differing views on its relevance, particularly with the ascent of the government of national unity (GNU).

Speaking at a symposium this week organised by Frontline Africa Advisory, South African Chamber of Commerce CEO Alan Mukoki argued that a lack of consensus among constituencies on critical issues poses problems for policy making.

“Lack of consensus at Nedlac does not mean government will not implement policies. It happened with the National Health Insurance (NHI) Act and the Basic Education Laws Amendment Act.

“The question is how constituencies can narrow their differences to make sure their participation in policy processes goes beyond their narrow sectoral interests in a way that moves the country forward,” said Mukoki.

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Mtimka’s research shows that just 25 of the 162 bills introduced in parliament during the previous administration were referred to Nedlac – a worrying indicator of the institution’s diminished role in legislative review.

Government fails to turn up for meetings, while business and labour often prefer bi-lateral engagement with government to advance their own interests.

This undermines Nedlac’s consensus-seeking role and dilutes the social compact it is mandated to pursue.

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Complicating matters is the fragmentation within organised labour, with competing trade union bodies adopting differing policy positions. Organised business, on the other hand, appears more united.

That said, research by Stellenbosch University details organised labour’s success in steering policy decisions such as the creation of what would become the Commission for Conciliation, Mediation and Arbitration (CCMA) and the formation of new collective bargaining forums.

Nedlac is dismissed by some as another talk shop that delays decision-making, but Mtimka believes adding another three to six months to the legislative process is not extreme.

There’s also a widespread belief that Nedlac entrenches a caste system that excludes the most vulnerable in society, particularly the unemployed.

Does the GNU make Nedlac more necessary, or less so?

The GNU marks an end to the monopolistic national political system, says Mtimka.

What is now needed is consensus that subordinates party interests to the broader good of the country and embraces elements of both capitalism and socialism.

The research suggests we should be benchmarking Nedlac against the Nordic model which seeks consensus of “vital principles, values and societal issues”.

The prize, if this can be achieved, is superior economic growth, political and societal stability and higher living standards.

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Says one of the Nedlac participants quoted in Mtimka’s research: “When they [labour] think that they can get more, like now on the labour law amendments, they go directly to the minister of labour and speak with the minister and say you can’t take this route.”

Government often prefers to have policy matters discussed outside Nedlac, according to the research.

Nedlac hit its primacy in the 1990s and 2000s when it green-lighted legislation such as the Labour Relations Act, the Basic Conditions of Employment Act, the Employment Equity Act, the Skills Development Act and the Unemployment Insurance Act.

More recently it provided input to the amended Companies Act, the Competition Amendment Bill and the National Health Insurance Bill.

It certainly regained some of its relevance during the national Covid-19 response, particularly the implementation of the Temporary Employer/Employee Relief Scheme and occupational health and safety directions allowing for the safe reopening of workplaces.

Maybe it needs to be beefed up?

Frontline Africa Advisory MD Thembinkosi Gcoyi said it is legitimate to ask whether government takes Nedlac seriously enough.

It’s important, he added, that Nedlac remains to support the work of the new administration as it navigates ideological differences and sectoral interests of the different constituencies.

Read:
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Lucas Qakaza of the South African National Civic Organisation (Sanco) argued that after 30 years of democracy, it may be time to review these institutions.

“The Auditor-General’s powers were enhanced in terms of the work that it is doing. The same may be necessary for Nedlac.”

There’s a new Nedlac Bill in the works, which many hope will give it the kind of teeth the Auditor-General has been granted to ensure accountability in government.

“It’s also an opportunity to strengthen the institution and ensure it plays a greater role in fostering social compacts that drive social inclusion and economic transformation and development,” says Frontline Africa Advisory.

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