The mining companies, which directly employ around 80 000 employees, together with AMCU, NUM, Solidarity and UASA will be led in a collective bargaining forum by the Minerals Council South Africa (formerly the Chamber of Mines of South Africa).
In his presentation to the unions this morning, Motsamai Motlhamme, Minerals Council chief negotiator, shared information with the unions about the state of the gold industry and noted that while the gold industry remains a significant contributor to the South African economy and its people, the industry was facing major challenges. He noted these as follows
- A stagnant gold price, and a volatile gold price and rand-dollar exchange rate which affects long-term planning, investment and production. The industry has no control over these variables.
- Continually rising input costs, with wages and electricity together comprising around 70% of the total cost base.
- Operational challenges, such as increasing depth of operations, ageing infrastructure, greater distances to working areas, reduced flexibility and declining grades which have all contributed to a consistent decline in production and escalating cost pressure.
- Policy and regulatory uncertainty, which continue to negatively impact investment confidence and increased the cost of capital.
“Despite the gold industry’s declining production, it continues to make an important contribution in the lives of employees, communities and the country as whole, through the payment of taxes and royalties, by providing good quality jobs and benefits, education and training, and by continued investment in social projects and infrastructure,” he said.
Recent statistics show that the gold sector contributed R43 billion towards GDP (2016); and in 2017 produced 138 tonnes of gold; employed around 112 000 people; contributed R6.5 billion in taxes; paid royalties of R1 billion; and paid employee wages and benefits of around R30 billion.