Mining & Industry News
22 June 2018

Trade union Solidarity is concerned with certain sections of the Minerals Council of South Africa (formerly the Chamber of Mines)’s revised mining charter, specifically those sections dealing with new cost items that have been built into the new charter, and more specifically, the 5% free carried interest when it comes to shareholding by employees and mining communities.

Solidarity general secretary Gideon du Plessis explains: “We share the Mineral Council’s concern about ‘new forms of taxation’ that have been built into the charter, but Solidarity blames the outcome of the negotiations mainly on the council’s sluggish and short-sighted approach to talks.”

Du Plessis contends that the cracks in the council’s stance started to show up during the 2015 gold negotiations already, mainly due to a lack of strategic thinking when it comes to major negotiations. This lack has just become even more pronounced during the Charter negotiations.

“The council’s participation in negotiations was not proactive enough and one left the task team’s feedback sessions without being able to tell whether the council was in favour of or against task team proposals,” Du Plessis added.

Solidarity says it is absurd that the council is now expressing unease over the 5% free carried interest shares being granted to employees and communities respectively, as the council had weakened its own position through its poor negotiation.

“The agreement reached by all parties in the task team was for 3% free carried interest for employees and communities. At the principals’ feedback session on 10 April 2018 the Minerals Council raised no objection to 3%.

At a follow-up session of the task team we had to learn, though, that the council had suddenly changed its position to 1% free carried shares,” Du Plessis said.

In response, with trade union support, the government shifted from the agreed 3% to 5% owing to the council’s negotiations in bad faith. It is, however, important to take note that in its revised position, the Council did agree to the free-carried share principle that they are now protesting against,” Du Plessis explained.

Solidarity encourages the Council to change its strategy at the forthcoming mining summit and to proactively participate in the negotiations for a change. However, it seems that it could be too late to make any significant changes.

Du Plessis argued that if the Minerals Council had a counterproposal for an alternative employee scheme such as a profit-sharing model, they should develop this model and present it. “It is clear that criticism of the free-carried model won’t lead to a new model,” Du Plessis said.

In addition, Solidarity calls on the Council to learn from its mistakes and not to be so inept at the start of the gold negotiations next week.

Solidarity press release, 20 June 2018


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