Zuma's push leads to strike talks

Author: 
REUTERS
Publication Date: 
Tue, 2010-08-31 03:10

Union officials hoped the negotiations will lead to an improved offer to end the labour dispute that has closed schools, prevented treatment at hospitals and harmed investor sentiment towards Africa's largest economy.
"I have reason to be optimistic because the employer called us to a meeting," said Manie De Clerq, a spokesman for the Public Servants Association.
Public Service Minister Richard Baloyi said in a statement the government will bring a new offer to the table, without offering details. He held informal discussions with union bosses to pave the way for the official bargaining session. So far, the government has said it cannot afford the demand for increases of more than double inflation to end the strike, which threatens to spread across the economy.
Even if the government raises its offer, the unions are unlikely to respond quickly as they would need to consult their rank and file members.
Zuma's spokesman said the president was particularly concerned about the strike's impact on health and education.
"The president's view is that the strike must end as soon as possible, in the next couple of days," Zizi Kodwa said, adding that Zuma had spoken to government ministers at the weekend to tell them to resume talks.
"He appealed to both sides to put the interests of the country first," Kodwa said. He did not say what concessions Zuma expected the government to make.
South Africa's biggest strike since 2007 in terms of lost man days has left bonds, stocks and the rand largely unaffected, but market players said the strike would cap gains by the rand and could have a bigger impact if it drags on.
The workers are demanding an 8.6 percent wage rise and 1,000 rand ($136) a month as a housing allowance. The government has offered 7 percent and 700 rand.
Analysts expect Zuma and the African National Congress government, which has typically given in to labor's demands, to reach a deal soon, tilted in favor of the unions, and worry later about the damage to state spending.
"Politically, this is beneficial for Zuma because he is in a tight spot with the unions at the moment," said Susan Booysen, a political analyst at Wits University.
"The country already has a high deficit. The rise may result in higher taxes as the government tries to balance its books."

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