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Media Centre  |  COSATU Speeches

Address by Zwelinzima Vavi, COSATU General Secretary, to the Special Congress of the Communications Workers Union

Address by Zwelinzima Vavi, COSATU General Secretary, to the Special Congress of the Communications Workers Union

4 May 2001


We meet today at the start of an historic COSATU campaign, one with particular meaning for your union - that is, the anti-privatisation campaign initiated last week by the Central Executive Committee of your Federation.

This campaign must reverse the slow undermining of the democratic state, ensuring that it can play its full role in the social and economic development of our country and our communities.

The Communication Workers Union has experienced at first hand the dangers of privatisation. In the past decade, most recently in the name of "developmental restructuring," both Telkom and the post office have faced repeated assaults. The results, as we see almost inevitably with privatisation, have been both job losses and worse services for the poor. Only the rich have benefited.

In the past three years, we have seen the loss of 17 000 jobs just in Telkom. That is almost a third of the company's total employment. In these three years, Telkom, by itself, accounted for over 2 per cent of job losses outside the public service.

At the same time, the restructuring of Telkom has been associated with declining services for the majority of our people. According to the government's own statistics, in the October Household Survey, in 1999 less than a third of African urban households a nd less than one in ten African rural households had telephones, compared to over 80 per cent of rural and urban whites. The level of telephone connections in African areas had fallen since the previous year.

Soaring rental charges for telephones place them beyond the reach of at least a third of our people. At the same time, the increase in local telephone charges makes telecommunications increasingly inaccessible. Local charges rose 35 per cent even after inf lation in the past two years. At the same time, we saw a 40-per-cent fall in the cost of international phone calls, which mostly benefit business and the rich.

We should not be surprised at this kind of results from privatisation. Our only surprise is that government can still call it "developmental." After all, private companies must seek to maximise their profits. No matter what the broader social gains would b e, they can't afford simply to give services to the poor. After all, no men or women open a business to meet challenges of poverty, unemployment and or to provide services to the people. All these are accidentals in pursuit of profit by companies. That our government suddenly believes that business will provide services to the poor is astonishing indeed. Certainly they will compete to improve efficiency for business and the rich - but no one competes for those with empty pockets.

That is why the Alliance has always called for a strong developmental state, which can undertake interventions that are crucial for development. One of those interventions is the provision of telecommunications to poor households and communities. We could accept increased private provision of services to business and the well-off, if it helped pay for increased services for the majority.

Improving telecommunications to the poor is important in a variety of ways. It helps people participate more actively in the economy. Studies show that people in households with telephones find jobs much more easily. Furthermore, telecommunications open th e door to substantial improvements in health care and education. And finally, it is critical for families and friends to communicate - which is particularly important in our country, where apartheid scattered so many people far and wide.

In short, the extension of telecommunications to the poor must form a central part of any development strategy. But the privatisation process has undermined efforts in that direction, rather than strengthening them.

The Telkom experience underlines something else -the way that government has embarked on all kinds of creative forms of privatisation, convincing itself that because it is not simply selling off public assets, it is not undermining the state. But it plans to hand control over telecommunications to the private sector just as effectively as if it had auctioned Telkom to the highest bidder.

The process started a few years ago with the sale of a "strategic share" to foreign partners. We were assured, as labour, that this would not lead to retrenchments, and that government would retain control of the company. Instead, we have seen massive job losses. Moreover, it has become clear that, in the still-secret shareholder agreement, government gave up the power to make key decisions, including around top-level personnel and labour relations.

Now, government has announced a further phase in this complex privatisation process, with the introduction of a second national service provider. In effect, as in so many areas, government claims it is not privatising Telkom - but it is privatising telecom munications. And that will aggravate current problems. As Telkom must compete with the new provider, both companies will face increasing pressure to drop the less profitable part of the market - that is, our own, working-class communities.

True, government argues that the second service provider will also have some obligations to service the poor. But it is typical that these obligations remain entirely vague, with neither time frames nor mechanisms to ensure monitoring and fulfilment. We se e neither stronger regulation nor proposals on pricing that could ensure that the new providers give all our people access to telephones.

Government's says it will let underserved communities set up co-ops or look to independent SMMEs for telephone connections. That cynical decision underlines the extent to which its current policies abandon the poor. It grants the poor the right to pay for their own telephones. In contrast, the apartheid state paid for telephone infrastructure in rich communities over several decades. Surely, when we risked our lives in the struggle for freedom, we did not mean to set the poor free to pay for basic services.

This privatisation by stealth is replicated across our economy and our society. Our government knows that we did not elect them in order to undermine the strength of the state. So it finds all kinds of clever ways to hand its functions and resources to pri vate business, often without actually selling off assets.

In the case of state-owned enterprises, as with Telkom, it sells off substantial shares as well as some assets; and it brings in private competitors.

In the case of local government, it employs private management for basic services, especially water and refuse removal, as well as simply privatising some functions. These moves make it increasingly difficult to implement the ANC's commitment, in its 2000 elections manifesto, to provide free lifeline services for all.

For the national and provincial public service, government looks to outsource unskilled work, shifting tens of thousands of workers from permanent, well-paid jobs to casual labour. In addition, wherever it can, it makes people pay for services. In educatio n, this has meant the effective semi-privatisation of the entire public school system. The results have been the reinstatement of the inequalities we fought against in the past, this time on the basis of race and class rather than race alone.

Government says that it has consulted with labour on all these moves, especially around state-owned enterprise. Why, it asks, do we then feel we must take action?

Because - and no union has experienced this more deeply than CWU - we have talked and talked to government, and seen extraordinarily little change in their policies. Our discussions under the NFA have indeed been interesting, challenging and intellectually stimulating - and they have had no visible impact whatsoever on proposals for privatisation.

We are not fighting for an empty process of consultation. We are fighting for a policy to strengthen the state so that it can provide an adequate social wage and effectively support economic growth and job creation.

We know the press and even the opposition parties will portray our campaign as undermining the unity of the tripartite Alliance. That would be wrong.

We in the Alliance know from our long history that our strength derives from robust and open debate and the mobilisation of our people. The Alliance brings together the progressive forces of our country, rooted in relationships forged in the struggle again st apartheid. Still, if we as COSATU feel that government policy does not reflect the principles of the Alliance itself, we have no choice but to take action. We know that our Alliance partners understand the need for mass mobilisation and mass action to t ake forward the progressive movement and the reconstruction of our society and our economy.

In this connection, we note the irony and sadness the fact that it the high-ranking Communist Party members in posts dedicated to the implementation of privatisation and other policies hostile to the working people. These comrades end up driving policies t hat strengthen private ownership, reduce protection for the poor and workers, and lead to massive job losses.

Still, we recognise that the blame lies not with individual comrades, but with the policy decisions and processes within government.

Because finally, we have to ask why this government, our government, a government for which COSATU fought and campaigned, has fallen in love with privatisation.

One answer lies in the failure to develop a participatory democracy, where our people have a real say in decisions that affect them. As a result, it becomes too easy for officials to push their own agendas at the cost of the Alliance's constituencies. All too often, these agendas are shaped by consistent lobbying and pressure by local business, foreign governments and companies, and multilateral agencies like the World Bank and the WTO. Sometimes this lobbying reflects short-term interests -consultants make millions out of privatisation, and financial interests can make billions - and sometimes it arises out of ideology. In either case, our campaign must counterbalance these forces by giving our people, the majority of South Africans, a voice.

In addition, privatisation follows from the budget cuts caused by the GEAR. Between 1996 and 1999, government spending dropped steadily in real terms. To justify these cuts, the Treasury argued that services could be provided by the private sector instead. But we know there is no free lunch - and private companies will not serve our people for free. It is simply a delusion to think that they will make up for the shortfall in government resources.

Comrades, the success of our anti-privatisation campaign rests with you and all our members. We need to make sure that every South African understands the nature of privatisation and how it affects our communities. We must mobilise in our workplaces and ou r neighbourhoods. When COSATU publishes the programme of action for the campaign, we must each take part as strongly as possible.