The Justice and Peace Commission for the Southern African Catholic Bishops’ Conference (SACBC)  has spoken out against plans by mining companies to retrench thousands as the mining sector in South Africa grapples with a deepening slide in commodity prices and rising costs.

“As pastors we are always saddened by the suffering that thousands of our people experience when there is restructuring and massive job cuts in any industry in South Africa. That is why we applaud the Minister of Mineral Resources for the initiative that he has taken and the leadership he has demonstrated to get the stakeholders in the mining sector in South Africa to explore alternatives to retrenchments and re-skilling of mine workers.”Says Bishop Abel Gabuza, Chairperson of the SACBC Justice and Peace Commission.

The Commission has also called on the Government, mining houses and labour to consider broadening the terms of their engagement to include establishment of a comprehensive social compact in the mining sector.

“We agree with those who argue that the current global economic environment necessitates establishment of a social compact so as to ensure competitiveness and sustainability of our mining sector that is required to create and retain jobs. However, we believe that such a social compact should be built on the principle of wealth sharing, and not only on loss sharing,” says Bishop Gabuza.

“The mining houses seem to seek a social compact that emphasizes the sharing of pain when commodity prices fall. We need a social compact that also emphasizes sharing of accumulated wealth with workers when the commodity prices rise. This should include the establishment of a Worker Sustainability Wage Fund during the years of super-profits to ensure adequate provision for workers when the commodity prices fall.”

The Commission also believes that the principles of putting people before profit and the common good should form the basis of the social compact.

“In the midst of low commodity prices we are told by some mining houses that mining is a business, and not a charity. We are told that in lean times mining is essentially about controlling costs, including labour costs, and disinvesting in loss-making assets so as to achieve better returns for shareholders as suppliers of capital. We would like to remind the industry that during these lean times mining should also be about people, especially the livelihoods of workers who helped the mining companies to make huge returns for shareholders during the years of super-profits. We have always emphasized that mining should also be about the common good – and not only what is good for shareholders at the expense of the broader society.  If the mining sector is serious about a social compact, it should embrace these principles.”

The Commission therefore calls on the mining houses to show a greater level of leadership to create the environment of trust required for successful negotiation of a social compact.

“A strong impression has been created that the mining houses in South Africa are opportunistically using the global resource crisis as an excuse to implement their long-held strategy of disposing of their assets, cutting jobs and blocking demands for a living wage. The mining houses have not done enough to convince the unions that this is not the case. To correct this impression and create an environment of trust, the mining houses should show leadership and consider a high level of financial transparency to the unions.”