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Friday, 14 November 2014 00:00

Pension Funds Invested in SA Mining at Risk

Written by CYPSA
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Pension funds invested in SA Mining at risk
 

"South Africa's ongoing mining-industry unrest was putting the country's pension funds at risk and it was critical that peace and stability be restored in the mining sector, Minerals Minister Susan Shabangu said on Thursday...  

Taking a lead role in a live Tsepiso Makwetla-anchored national radio debate on the South African Broadcasting Corporation's AMLive, Shabangu urged listeners to dispel the notion that foreigners were the sole investors in South Africa's mining sector.  "The pension funds of South African people are invested in the South African mining industry," Shabangu said, adding that the wholly South African-government-owned Public Investment Corporation, which invested the funds of public servants, was a mining-sector investor along with many other private-sector pension funds.

The investors were not just foreign but also local and retirement funds were being jeopardised.  Pension capital has been funding growth in the global economy for the last half century, with working people around the world – and in South Africa – setting aside a percentage of their current earnings to meet future needs.
American Platinum CEO Chris Griffith – who also took part in the same live debate together with the National Union of Mineworkers president Senzeni Zokwana and Chamber of Mines of South Africa VP and Anglo American's South African head Khanyisile Kweyama – overwhelmingly concurred with the Minister, saying that South Africans had the perception that foreign investors were the sole investors in South Africa's mining industry.

Makwetla repeated several times that the Association of Mineworkers and Construction Union president Joseph Mathunjwa had been asked to join the debate; attempts to contact him telephonically during the debate had failed, she told listeners.  Griffith said that awareness needed to be heightened on the potential for the current mining-sector disturbances to damage the pension nest eggs of ordinary South African citizens.

Investment in the South African mining industry was not only external but also local.  "The public pension fund must also make sure that they don't throw away the pensions of all the State employees in this country," Griffith added.  "We have a responsibility as South Africans to send out the best message about South Africa," Griffith told listeners.  It is the pension funds and provident funds of working people and the contributions of ordinary citizens to life insurance policies, which currently funds the economic growth of the modern world, Business Leadership South Africa chairperson Bobby Godsell has pointed out.

Foreign and local direct investment is invariably made up overwhelmingly of the retirement funds of employees around the world and is meant to ensure that workers can retire one day with sums of money that have at least managed to keep up with the rate of inflation, and have not been decimated by other workers.  By far the greatest current source of accumulation of capital is the pool of contractual savings of working men and women – "north and south, east and west", in both developing and developed countries, according to Godsell.
The violence that   as spread through the mining industry is giving rise to concern about where South Africa will source funding for the exploitation of its $2.5-trillion resources endowment, which Citibank calculates is the world's richest.

The Minister emphasised the importance of creating peace and stability in the South African mining space.  "Workers must come to work unarmed. They must not bring weapons into the working environment. If you take weapons to work it means that your intention is either to fight or to protect yourself," Shabangu told Makwetla, who drew attention to South Africa's reputation in the platinum market deteriorating to such an extent that Lonmin chief commercial officer Albert Jamieson had told Parliament that international buyers were fast losing confidence in South Africa as a platinum supplier and were looking to source their supplies either from other countries or to introduce platinum substitutes.

Key mining-industry stakeholders are thrashing out details of a framework of behaviour aimed at entrenching freedom of association and eliminating the root causes of mine violence.  The Department of Mineral Resources (DMR) on Thursday released a framework for peace and stability in the mining industry, which it described as being plagued by violence and intimidation with only negative consequences for the country.  The stakeholders, made up of government, business and labour, were in accord that everything possible had to be done to ensure stability to achieve growth in the mining industry.  It was agreed that violence, intimidation, lack of respect and intolerance for different views, associations and disassociation should be eradicated.

This had to be replaced by respect for life and property, rule of the law and existing agreements and policies, and for the right to freedom of association enshrined in the Constitution and labour legislation.  The stakeholders committed themselves to working together to create an industry where peace and stability reigned supreme and stakeholders were allowed to pursue their respective legitimate objectives for the ultimate benefit of the country.  The stakeholder leadership agreed collectively and publicly to denounce violence, intimidation and lack of respect for life and property.

Different views would be tolerated, including freedom of association and disassociation and existing and future agreements and policies would be honoured.

Anyone uttering inflammatory language would be held to account, and all parties would have access to their membership, which the right of managements to communicate with their employees.  No weapons would be carried or kept on company property at any time.  Stakeholders agreed to continue to engage each other during a period of 14 days to put the necessary structures, processes and timeframes in place. "Lives have been lost and injures have been suffered. Mines have come to a standstill with a consequent loss of income for employees and of production for the companie.  "This has increased the already existing economic pressures experienced by the industry, caused by the international economic downturn," DMR said.  The stakeholders agreed that they wanted an industry that flourished."

Source:  Mining weekly.com written by Martin Creamer   (21st February 2013)

Read 514 times Last modified on Saturday, 16 January 2016 14:53
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