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S Africa unions weigh Eskom offer to avert strike

The threat of power cuts helped drive up prices of platinum

South Africa is by far the world biggest platinum producer and also a major gold supplier.

A power strike would be a challenge to President Jacob Zuma’s authority as he tries to steer South Africa through the recession and defuse anger in poor townships that have protested against lack of adequate housing, electricity and water.

The country has been hit by a wave of industrial action that has led to above-inflation settlements, including agreements in the gold and coal industries.

The government also awarded a 13 percent wage hike to council workers last week, nearly double the inflation rate of 6.9 percent for June, to end a 5-day strike.

The National Union of Mineworkers (NUM), representing about half of the employees at Eskom, as well as smaller unions Solidarity and the National Union of Metalworkers (NUMSA) want a 14 percent wage hike — about double the inflation rate — and more for housing allowance.

Eskom offered a 10.5 percent pay increase, and the unions involved in the talks said they would meet the power firm on Wednesday to inform it of their members’ position.

‘We have an offer of 10.5 percent that we are seriously considering and we believe that it has all the potential to avert a strike,’(NUM) chief negotiator Paris Mashego told Reuters.

‘However, the deal breaker was the housing allowance. We have not achieved a housing allowance, what we have achieved is a process of reviewing the entire housing policy of Eskom. We are going to our members (with the offer),’ Mashego said.

This week the NUM said the three unions involved in talks with the utility had agreed to undertake joint mass action, including a march on Eskom’s headquarters on Thursday, if the wage and housing dispute is not resolved.

WORKERS TO DECIDE

‘We are waiting for a mandate from our members. They may accept or reject it (the new offer). Until our members say they have accepted, the march on Thursday is still on,’ NUM spokesman Lesiba Seshoka said.

The unions had rejected the power utility’s earlier offer of an 8 percent increase, as well as a 9.5 percent rise proposed by mediators, but said they could settle for a double-digit pay increase plus the promise of a housing allowance for next year.

Eskom generates 95 percent of South Africa’s electricity and 45 percent of Africa’s power output. Blackouts early last year temporarily crippled mine output, metal smelters and manufacturing, denting economic growth.

Eskom spokesman Andrew Etzinger said he was confident a deal could be reached to avoid a strike, but that the firm had contingency plans to deal with any work stoppage.

‘There has been a closing of the gap between the two parties, we will reconvene on Wednesday, and we are hopeful the process will be concluded successfully,’ Etzinger told Reuters.

On Friday the Communication Workers Union said its members at telephone group Telkom would strike nationwide on Tuesday after failing to reach a pay agreement with the firm. Monday is a public holiday in South Africa.