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COSATU Today  |  COSATU Press Statements

COSATU response to "The billionaires are back"

6 December 2010

The Congress of South African Trade Unions has for many years been highlighting the gross levels of inequality in South Africa, which have made us the most unequal society in the world.

The Sunday Times, 5 December 2010, has now revealed that, if the report is true, COSATU, far from exaggerating the gulf between rich and poor, has been seriously under-estimating it!

A survey by Who owns Whom has revealed that the number of super-wealthy South Africans have doubled in just a year. And this has happened while we have been recovering from a recession in which over a million workers lost their jobs and as a result over 5 million people were plunged into dire poverty.
According to the report, the number of billionaires has nearly doubled from 16 in 2009 to 31 this year. SA`s 20 richest men (only one woman made the top 100, and she only just made it, in 95th place), enjoyed a 45% increase in wealth this year.

It is the same story in earnings. COSATU has frequently quoted the income received by Nedcom CEO Tom Boardman, yet this survey reveals that he ranks only 38th in the league of highest earners!

Top spot is occupied by Pine Pienaar, CEO of Mvelaphanda Resources, who raked in R63 million in 2009, closely followed by Norbert Platt, CEO of Richement, who got R58 million, and Marius Kloppers, CEO of BHP Billiton who took home R54.

Only eight of the 150 top-paid executives come from the public sector, but what is remarkable is the number whose have either left or are leaving, many of them heading companies plagued with failures, controversy and financial bail-outs.

Scandalously, according to the report, the highest paid SOE executive in 2009 was Khaya Ngqula, the former head of SAA, who was forced to resign after SATAWU produced a dossier proving he had squandered R30. 8 million on perks for top executives. Yet he still ‘earned’ R13.7-million in 2009, including his controversial R9.35-million "termination benefit". He ranked 61st in the overall top earners list.

Jacob Maroga was sacked from Eskom in late 2009 yet earned a salary of more than R5 million in 2009. If he wins his legal claim for a payout for unlawful dismissal and for benefits he would have accrued into 2011, he will get a total of R85-million.

Dali Mpofu, former CEO at the SABC, which was R800 million in debt at the time he left, still managed to leave with over R7 million in 2009.

CEO of another struggling SOE - Christopher Wells of Transnet - received a whopping R6.8 million, and even the former CEO of Transnet Freight Rail, sacked for breaches of governance, managed to get R6.2 million in 2009.

Executives and senior managers at Transnet, Eskom and the IDC were paid an average of R3.7-million per year for the past three financial years to the end of March. The IDC paid its 20 directors (including those at subsidiary Foskor) and senior managers R170.6-million over the three years, at an average of R2.8-million each.

In terms of ownership of wealth, if the report is true, the top four remain unchanged. Not surprisingly then list is topped by Laskhmi Mittal, owner of ArcelorMittal SA, with a fortune of R21.5-billion, which is only the value of his holding in ArcelorMittal SA, not the international ArcelorMittal Group.

The richest South African, is Patrice Motsepe, who is worth R19.9-billion from his stake in African Rainbow Minerals and Sanlam. But this excludes the value of his other investments, including Mamelodi Sundowns.

Third is a name which shows how little has changed since the days of apartheid - Nicky Oppenheimer, chairman of De Beers, who has a 2.5% stake in Anglo American, founded by his grandfather Ernest in 1917.

Number four is Shoprite chief Christo Wiese, who was arrested in 2009 at Heathrow Airport with nearly £675 000 (R7-million) in cash in a suitcase, which was confiscated and is now the subject of criminal proceedings against him in the UK!

These statistics will make workers more determined than ever to push for above-inflation wage increases. The wealth that these people own and receive is created by the workers’ labour in the mines and factories, on the farms and in the shops. Their bosses’ salaries and perks are now higher than those in developed countries, while workers’ wages are nowhere remotely near those of their American or European counterparts.

Yet so often it is these very same CEOs who moan about ‘inflexible’ labour laws and workers’ ‘excessive’ wage demands. It is the same people who say there is not enough money in the country to afford a National Health Insurance scheme. What utter hypocrisy!

These figures also confound the argument that CEOs are being rewarded for good results. Particularly in the public sector, but in private companies as well, it does not make any difference how well the company is performing. Even if you are sacked for failing to deliver or misusing the company’s money, your own earnings keep going up.

As COSATU prepares for next year’s living wage conference, we shall keep these figures in mind and use them to convince workers that they have every right to mobilise their members to fight for big increases, so that we can start to narrow the chasm between rich and poor in South Africa.

Patrick Craven (National Spokesperson)
Congress of South African Trade Unions
1-5 Leyds Cnr Biccard Streets

P.O.Box 1019

Tel: +27 11 339-4911/24
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E-Mail: patrick@cosatu.org.za