The Department of Labour was eventually reconfigured into the Department of Employment and Labour. This was after a long and tedious discussion that first started from a draft discussion paper in October 2019.
Eventually, in May 2023, the government’s technical advisory centre was appointed to analyse it in order to understand its ability, implement the employment mandate optimally and help implement the restructuring of the Department of Employment and Labour.
The reasoning behind this was the fact that unemployment had become one of the most destructive issues faced by the government.
The advisory centre completed its analysis and presented it to the department in November 2023. Employment creation and its functions were to be moved to the top of the agenda. Many observations were made about service delivery, organisational structure, financial resources, ICT systems and governance.
Much talking and many reports flowed like water under a bridge. Many flow charts and reports were generated. Much hot air and fanfare followed. Experts and academics worked hours to produce hundreds of pages of theory.
Despite all this, the government seems to labour under the misconception that it must be at the centre of job creation. Throughout the world over the past 30 years, we have seen a move away from governments creating jobs towards governments creating the environment for the private sector to create jobs.
Unfortunately, in 2023 and the beginning stages of 2024, the government still believes employment equity and negative onerous regulatory systems are needed. A large amount of money has been spent on entities known as the Public Employment Services and even the Department of Employment and Labour Administration. We still have a service delivery model built on the old style of government. The top-down approach doesn’t work and many thousands of South Africans can tell us how the Department of Employment and Labour has failed them.
The labour policy and industrial relations programme of the department has to analyse and report on the labour market trends annually and research reports developed on the impact of labour legislation on the labour market.
The programme is vital and needs to be given adequate resources to fulfil the mandate. My understanding is that Nedlac, which is the debating chamber for labour policy, has made various proposals about amendments to our labour laws. Hopefully, the proposals will see the way forward to follow up on the expanded mandate of employment policy.
Over the past few years, President Cyril Ramaphosa has made a heartfelt plea to his ministers to analyse their laws and regulations to ascertain which ones stand in the way of job creation. The newly structured Department of Employment and Labour holds the final mandate to ensure that the government is creating an environment to assist the private sector to create jobs.
We are all aware that the Unemployment Insurance Fund and the Compensation Fund are not performing and have issues relating to service delivery. The two entities are juristic creatures of the statute in that they have powers conferred upon them by the enabling legislation. The entities and their boards should be advising the minister of employment and labour on the amendments to legislation.
Both of them are Schedule 3A entities and should be moved from the director-general of the department to a board. The funds should be capacitated into more traditional 3A public entities with appropriate governance and accountability.
There is a requirement for legislative amendments to create a formal board as accounting authority, own fund staff complement and associated ICT and other infrastructure arrangements.
We need to also recognise that Productivity SA should not be undertaking employment creation itself but should look at the structuring of its function to help the business community. It is recommended that Productivity SA downgrades many of its functions and restructures itself to be able to advise small businesses on how to not just survive but thrive.
Likewise, Public Employment Services, which is an entity within the department, needs an urgent restructuring and redesign. The outputs are not in any way aligned with the needs of the economy. We don’t have enough inspectors or enough oversight over the business community, thereby failing the employees of South Africa.
One of the most disastrous areas of the department is the computer systems and that, in particular, the SAP implementation has been extremely slow, expensive and not delivered.
The department has spent almost R1 billion over the past few years on computerisation and has little value to show for it. At least now it is recognised and understood. This recognition means that we are on the road to stabilisation. Much of the work done by the department should be unbundling, moving from the public sector to the private sector. This will, however, mean staff reduction and retraining, but it is about time.
* Michael Bagraim is a veteran labour lawyer.
** The views expressed here are not necessarily those of Independent Media.
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