1. The CEC received reports and warmly endorsed the ’Framework for South Africa’s response to the international economic crisis’. The Nedlac constituent organisations in partnership with the Presidency, following the Presidential Economic Joint Working Group meeting held in December 2008 negotiated this framework.

2. The CEC congratulated the COSATU National Office Bearers and the Labour Convener and other negotiators for ensuring that the ‘Framework for South Africa’s response to the international economic crisis’ was produced, negotiated and adopted by government, business and community constituent formations in Nedlac.

3. The CEC calls on all affiliates and other unions to ensure that the ‘Framework for South Africa’s response to the international economic crisis’ is translated into an effective tool to fight job losses and cushion the poor from the effects of the crisis, as envisaged in the agreement. In this regard every union must build capacity to use the agreement to maximum effect. All COSATU unions must initiate the convening of meetings in their sectors with the employers and relevant government departments and relevant state-owned enterprises to ensure that all the aspects of the framework are implemented in all affected sectors of the economy.

4. The CEC calls on all provincial Premiers to call meetings with labour and business to develop provincial stimulus packages based on this framework and to convene stakeholder forums to develop the plans in more detail.

5. COSATU will produce copies of the documents for all shop stewards and will produce a summary of the ‘Framework for South Africa’s response to the international economic crisis’ for distribution to members.

6. The CEC endorses the principles that we need urgent action now to address the crisis in the short-term but that we also need to change the basic foundations of the global economy to make it serve people, to combat the greed and inequalities that characterise the system and to ensure government again plays its rightful role as regulator and protector of the public interest. Decades of declining income for workers, of ruthless free trade that builds on exploitation of Asian, especially Chinese workers, of surges in executive pay, of corporate corruption in many cases, of governments that were captured by corporate interests, of speculative capital that was unregulated, are the foundations of the current crisis.

7. The CEC received reports from the affiliates and discussed the scale of the current and the envisaged job losses in all the sectors of the economy. The primary industries and manufacturing sectors are bearing the brunt of the international economic crisis. The NUM estimates that between 20 000 and 50 000 jobs may be lost in the mining industry. According to Statistics South Africa, the manufacturing sector is not only entering a recession but also dropping at rates last seen in 1960. According to official data, manufacturing dropped by 21, 8% in the last quarter of 2008.

8. NUMSA informed the CEC that 11 000 jobs were lost in the automobiles and components sector in 2008. This year a further 29 700 jobs are at risk. SACTWU told the CEC of factory closures and 10 000 job losses in the clothing, textiles and footwear industry in 2008, with large looming retrenchments this year. All unions were urged to collate information and forward it to the Federation.

9. Workers employed by labour brokers as well those workers have been subcontracted, who fall in the category of the most vulnerable, carry the burden of much of the job losses. This underlines the importance of ensuring that Nedlac immediately convene its labour market chamber to look at how the commitment made by the ANC in its 2009 elections manifesto “to regulate contract work, subcontracting and outsourcing, address the problem of labour broking and prohibit certain abusive practises” can be achieved on an urgent basis. The ‘Framework for South Africa’s response to the international economic crisis’ also commits that organised labour’s concerns about labour broking and outsourcing should be addressed.

10. The CEC endorsed the call for solidarity amongst affiliated unions and amongst workers in general. No trade union movement worth its salt would just fold arms at the time when its members and workers in general are paying the price through losing their jobs and livelihoods, for a crisis they did not create, a crisis in fact caused by inequities in the global economic system and corporate greed in many parts of the world. In this regard, the CEC called on all unions to monitor very closely the ongoing carnage of job losses and discuss whether COSATU and other federations should consider filing a Section 77 notice with the intention of protesting against the job-loss bloodbath. A special campaigns committee will be convened once all information has been collated. If in the view of the campaigns committee the Federation must file in a Section 77 notice the NOBs will convene a special CEC to consider this and other recommendations of the campaigns committee.

11. We record that workers in employment provide the social safety net for the unemployed through sharing their often meagre wages with unemployed family members and friends. The CEC - through affiliates - call on members in employment to consider what additional measures of social solidarity it can show to the unemployed and to those whose jobs are at risk. It recalls the historic efforts in 1999 to donate one day’s pay to a Fund to create new jobs. Unions will now go back to workplaces to hear from members how they will respond with solidarity to those most affected.

12. The CEC noted with concern that in some cases, companies are opportunistically using the international economic crisis as the excuse to embark upon previously conceived plans to cut jobs and maximise profits. For example it does not make sense that the gold mines are jumping at the bandwagon of cutting jobs when the price of gold remain stable.

13. The CEC calls on all the affiliated unions and indeed on all unions in the country to fight relentlessly, using every means in their disposal, to resist job losses. In this regard, unions must aggressively utilise the provisions of Section 189 of the LRA and in the case of the mining industry, Section 52 of the Mineral Petroleum Resources Development Act.

14. COSATU calls on all companies to do everything in their power to avoid retrenchments. No company that makes profit should retrench under current circumstances. Companies making losses should explore all alternatives to retrenchments.

15. The principle outlined in the Framework for South Africa’s response to the international economic crises that ‘the risk of unfairly placing the burden of the downturn on the poor and the vulnerable must be avoided” must be adhered to and practicalised. This pain must be shared! In this regard, the COSATU CEC calls on the corporate sector to urgently and seriously review the perks and the extraordinary high salaries paid to CEOs and senior management. These should be cut to the bare minimum as part of companies preparing to meet the economic downturn. Retrenchments must be used only as the truly the last resort when everything else including elimination of wasteful expenditure and high executive pay, has been tried.

16. The CEC noted with regret that some shop stewards and workers mistakenly seek to address their short-term cash flow and debt problems by taken voluntary retrenchment packages. Regrettably, some employers knowing the extent of the debt levels amongst workers, use voluntary retrenchment packages and additional monetary incentives to lure workers and shop stewards to accept job losses. Some affiliates in response to these crises had to remove the right from some shop stewards to negotiate retrenchments and placed that responsibility to the provincial and regional offices of their unions.

17. During these difficult times workers who are highly indebted are even more vulnerable. COSATU calls on the financial sector in particular the banks not to further jeopardise the bleak economic future of workers through this reckless and greedy borrowing practises that is largely responsible for the global crises in the first place.

18. The CEC noted with deep concern the news that the economy shrunk by a massive 1, 8% in the last quarter of 2008. This is entirely consistent with the news we have been receiving last year from factories, mines and other workplaces about the downturn in the economy. Whilst we recognise that this is linked to the international economic crises, we at the same time believe that South Africa would have not been so direly affected had we adopted appropriate macro-economic policies and implemented an industrial policy to restructure our economy and placed it on a new labour-absorbing developmental path.

19. In the regard, the Reserve Bank and its conservative monetary policy committee must take much of the blame for the massive decline in economic growth. At the time when all industrialised economies were aggressively cutting rates in response to the global economic crises, the Reserve Bank bucked the trend and maintained extra-ordinary high levels of interest rates and a holier-than-thou attitude to price stability. They dismissed our concerns and our calls for aggressive cutting of interest rates, but now today workers are paying the price for their short-sightedness. We have warned repeatedly that pursuing the goal of inflation targeting was not only misguided in the context of South Africa, but would hurt our economy badly. The toxic chickens of job losses have come home to roost indeed.

20. The fiscal policies of the government, including the current budget, do not adequately respond to the challenge at hand, in the light of the latest economic data. The budget will not sufficiently cushion workers and the poor from the job losses and resultant poverty disaster staring them in their eyes, and further fiscal measures will need to be considered.

21. The delay until 2010 of the implementation of the royalties’ fees in the mining industries, which amounted to R1, 8 billion should not be unconditional. In fact, state support to all ailing sectors (including the APDP for the auto sector) should be based on conditions that require undertakings that the companies concerned:

 I. Will save jobs and will take special measures to avoid retrenchments

 II. Will ensure modest pay packages for their CEO and senior management

 III. Will introduce additional training and retraining for workers

 IV. Will develop rescue packages in partnership with trade unions in their sectors

 V. Will have a record of full compliance with all the provisions of labour laws and collective agreements

22. We note that government (at all levels) at times fail to adhere to agreements to support the ‘buy local’ campaign, such as the commitments made at the Growth and Development Summit of 2005. Government procurement policies and its sourcing policies leave much to be desired and have directly led to loss of local jobs and factory closures. The following examples illustrate the problem but it is by no means limited to the sectors mentioned:

 a. The Johannesburg Metropolitan Council sourced its busses from Marco Polo in Brazil leading to the closure of Durobuild and Busaf bus manufacturing companies with 1000 and 600 job losses respectively.

 b. Transnet cancelled its contract with Scaw Metals and sourced the wheels of locomotives from China. Now 200 workers who were engaged by Scaw Metals stand to lose their jobs.

 c. Gauteng government sourced carriages for the Gautrain in Britain, leading to job losses at Union Carriage, which used to produce carriages for Transnet.

 d. All the cranes working in the Gautrain have been sourced oversees whilst crane-producing companies are closing their factories.

 e. Government can help stop the carnage of job losses if it has a political will to do so and we look forward to an urgent review of procurement to address this.

23. We acknowledge with gratitude the gallant efforts of the South African Receiver of Revenue, which has launched a campaign to combat illegal imports.

24. The scale of job losses in the mines may lead to the total collapse of the small mining towns in that the municipalities that relied on the taxes and levies from the mines will lose their revenues leading to poor service delivery and loss of jobs at local government level.

25. The CEC has noted with deep concern the reports that large South African banks are withdrawing credit to the real economy. We call on banks and financial institutions to avoid plunging the country into crisis through such actions. We will meet with large banks to make the point that they need to act responsibly to help the country to come through the crisis with our economy reasonably intact.

26. The CEC welcomes the commitment to maintain and possibly expand the planned public investment programme of R787b. It calls on affiliates to use their influence to ensure that resources are made available for a government-backed development bond, through resources from retirement funds and from companies.

27. We believe that funds that are available through the UIF, SETAs and the National Skills Fund should be utilised for a national fund to help workers in vulnerable sectors with training and other active labour market measures to attempt to avoid retrenchments.

28. We call on all South Africans to stand together to weather the economic storm and we call on government to ensure that appropriate changes are advocated at global level to make sure that the deep-seated inequalities and lack of regulation in the global economy are rectified so that the world that emerges from the crisis is one founded on social justice, fair labour standards in all countries, equitable development and decent work for working women and men across the world. In this regard the forthcoming G8 summit will provide an opportunity for these matters to be addressed.