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Sunday, 14 July 2019 23:44

The Sunday Times reports that the cash-strapped SA Broadcasting Corporation’s (SABC’s) turnaround plan includes cutting staff by up to 33% and closing down five offices.

The decision is contained in the broadcaster’s latest road-map strategy, which is now being further tweaked in a bid to gain the support of the Treasury and the department of communications (DOC).

The document, seen by The Sunday Times, also proposes:

● Cutting 19 general manager posts, saving R28.5m a year;

● Dissolving SABC Sport and incorporating it in the television and radio division;

● Reducing management by 37%, thereby saving R82m; and

● Cutting news staff by 233 from the current 936, saving R62.23m.

Phase 1 of the plan requires all group executives to present plans to their executive directors by the first week of August on how to cut personnel costs by 30%. This is expected to shave R279m a year in costs. Phase 1 also includes a “report to the shareholder on pending retrenchments”.

Last month SABC board chair Bongumusa Makhathini told The Sunday Times that at the end of May, the corporation had to choose between paying salaries or its municipal account. The broadcaster owes the City of Johannesburg more than R13.5m and is heavily indebted to various other suppliers.

The turnaround plan — initially approved by the board in August last year — was rejected by the finance and communications ministries when the SABC applied for a R3.2bn government guarantee in March.

However, a senior source at the SABC said the strategy was still being implemented by the broadcaster. “There are a few changes here and there as proposed by Treasury and DOC, but those inputs haven’t changed the plan drastically.”

The plan states that of the SABC’s 300 independent news contractors, 100 must be cut. A further 101 must be cut from the sports section and 86 from the media technology and infrastructure unit. This, the broadcaster says, will save it R77.5m a year.

The plan includes closing offices in Tshwane, Montague Gardens in Cape Town, Ulundi, Kimberley and George, thereby saving R25.5m a year.

“The primary goal is to create efficiencies and therefore realise cost savings on total staff bill of R3.02bn and operational costs,” the document reads.

SABC spokesperson Vuyo Mthembu said the SABC would not comment on documents that contain “commercially sensitive” information.

Last month finance minister Tito Mboweni informed communications minister Stella Ndabeni-Abrahams that the Treasury was declining a R3.2bn bail-out request from the SABC. However, Ndabeni-Abrahams announced in her budget speech this week that the broadcaster would receive urgent “interim” financial relief from the Treasury in the next 10 days, with the balance to be released 45 days after that.

Communications spokesperson Nthabeleng Mokitimi-Dlamini said the government was committed to strengthening the SABC.

• The original of the above report by Mpumzi Zuzile appeared on page 1 of The Sunday Times of 14 July 2019

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Thursday, 11 July 2019 13:11

Business Report writes that the first week of long-anticipated negotiations between platinum mining companies and the respective unions have begun with mining companies to respond to tabled demands next week – the quiet before the storm.

Major mining houses, Anglo American Platinum, Impala Platinum (Implats), Sibanye Stillwater as well as other junior miners received the varying demands from unions including with dominant player Association of Mineworkers and Construction Union (Amcu) as well as the National Union of Mineworkers (NUM), which is not represented at Implats.

“We have just tabled our demands for a R17 000 basic salary, R7 000 housing allowance and other conditions of employment that are part of the negotiations. This is only the first week and we will be getting responses from the mining companies next week,” Amcu’s national treasurer Jimmy Gama confirmed in an interview yesterday.

Gama said at this stage the union was tabling its proposals and clarifying points, but as in all negotiation processes, “cannot be too rigid or too flexible.” NUM conformed that it had tabled a 15 percent basic pay increase or R1 500 rise, whichever was greater, as it had different package demands at different mines. “We will be tabling our demands at the various companies all this week, including Sibanye Stillwater today. This is just the start of the process. We will have feedback once the companies start responding,” said NUM’s William Mabapa.

The wage talks are expected to be tough, as higher prices for palladium and rhodium and a weaker rand currency have boosted profits at miners such as Amplats, Sibanye – now combined with Lonmin – and Implats after several years of losses.

Amplats last month flagged that its half-year earnings were expected to rise by at least 80 percent, boosted by the increased metal prices.

Amplats, the most profitable producer, expects to triple first-half net income to at least R6.1 billion. The company has also rebuilt its cash position, after selling or shutting down higher-cost mines. Sibanye, Amplats and Implats all declined to comment on the size of their stockpiles of platinum group metals.

“It is no secret that the industry is in a difficult situation financially, we are restructuring and doing all we can to secure jobs. It will not be easy to find solutions to what the unions want, but if there is determination of being open and looking for solutions, we will find each other,” Implats spokesperson Johan Theron said.

Anglo American Platinum would not be drawn to comment on progress of the negotiations.

Analysts have warned that while unions might feel their demands are justified as higher palladium and rhodium prices boost company earnings, high settlements threaten the number of existing jobs and existence of the mines.

The original of the above report by Banele Ginindza appeared on page 18 of Business Report of 11 July 2019

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Tuesday, 09 July 2019 14:12

Business Report writes that in a first for South Africa, a urine-recovery urinal system developed in the Department of Civil Engineering at the University of Cape Town (UCT) has been incorporated into the design of Growthpoint Properties’ new corporate headquarters for Exxaro in Centurion. Built to accommodate 1 100 people, the ninestorey, R600 million building opposite the Centurion Gautrain Station has also won an innovation star from the Green Building Council of South Africa. The onsite fertiliser recovery urinal developed by UCT civil engineering graduate Craig Flanagan earned him a Greenovate Award in 2017. The work, led by senior lecturer Dr Dyllon Randall, resulted in the world’s first bio-brick grown from human urine and more than R5.56m in funding from the Royal Society as part of the Future Leaders – African Independent Research fellowship. Rudolf Pienaar, chief development and investment officer at Growthpoint Properties, said: “Green innovation at university level is changing our built environment. By incorporating the fertiliser-producing urinal concept into a major commercial office, it has changed Growthpoint’s thinking on how it develops new buildings.”

• The original of the above report appeared on page 13 of Business Report of 9 July 2019

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Wednesday, 03 July 2019 13:31

Sowetan reports that nursing union Denosa has rejected a suggestion by Gauteng health MEC Bandile Masuku to have Ekurhuleni metro police officers patrol Phola Park Clinic in Thokoza, which was attacked by criminals recently.  

On Tuesday, Masuku met with the Ekurhuleni health district and Phola Park Clinic management following a security breach, where people ransacked the clinic while apparently looking for a certain man. The incident forced the Democratic Nursing Organisation of South Africa (Denosa) to withdraw its members from working night shift at the clinic.

Masuku then announced that the Ekurhuleni Metro Police Department (EMPD) would patrol the facility at night to ensure patient and staff safety. But the union is not buying it.

“These incidents are happening all the time. EMPD would say they will come but at night they will say they are not baby-sitters. They are saying they are going to patrol but there is a chance they will patrol at 10pm and at 4am in the morning.

“What happens if there is an incident at midnight?” asked Denosa Ekurhuleni secretary Lebo Khumalo.

On Sunday night, three men entered the clinic carrying knives and searched for a man who had been stabbed in an apparent attempt to finish him off.

The men went from ward to ward, damaging property in the process.

The incident happened just a day after three men attacked a patient at the casualty waiting area at South Rand Hospital. “I think even the community members are aware that at night there is just a few female nurses that are there. “People in this area are not going to access health services at night until we are convinced that our members are safe in the facility,” said Khumalo. She said the union would feel safe when there was increased security personnel at the clinic and a security system screening people before they can access the facility. Masuku said the “rising” incidents of violence and “lapse” in security at health facilities was a huge concern for the department. “We will be reviewing our service-level agreements with security companies that are providing services in our institutions,” he said. Meanwhile, City of Johannesburg MMC for public safety Michael Sun has announced that their emergency services personnel will be armed with panic buttons and police escorts would be rolled out to curb attacks on the personnel.

Sun said the department will from now on screen calls from “hotspot areas”, following attacks on emergency personnel recently.

He said in the latest incident, members of the Jabulani Fire Station were attacked in the early hours of Monday.

At the weekend, paramedics were attacked in Cosmo City. “When the crew arrived at the scene and attempted to provide medical treatment to the injured person‚ the ambulance crew was confronted by a mob.

Sun said:  “The patient was allegedly injured as a result of a mob justice assault.  The mob turned on the EMS ambulance crew when they saw the crew trying to rescue the injured person whom they regard as the suspect.  The crew was able to retreat from the scene unharmed but were traumatised.  The city’s new ambulance‚ delivered just eight days prior‚ was damaged in the process.  In light of the attack on the ambulance crew in Cosmo City‚ we are now screening calls coming from these hotspots.”

The original of the above report by Penwell Dlamini was published on page 8 of Sowetan of 3 July 2019

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Friday, 21 June 2019 06:16

BL Premium writes that the scene for tough wage talks in the platinum sector has been set now that the dominant Association of Mineworkers & Construction Workers Union (Amcu) has demanded a minimum wage of R17,000, just as the troubled industry begins to find its feet again.

Platinum producers have been struggling to eke out a profit for years, but an unexpected surge in the palladium price — it’s gained 150% in three years — and the crumbling rand have given PGM producers a leg-up this year.

The price of rhodium, meanwhile, has risen by 300% since 2016.

Adjusted earnings among local PGM miners were a third higher in the first quarter of 2019 against 2018, says Amcu. That helps explain a 58% spike in the JSE’s platinum index since January 2, which Amcu hopes its members will benefit from.

Along with other provisions for housing, transport, provident funds, medical aids and more, the total cost to company demand per employee would hit R30,000.

Nedbank Corporate & Investment Banking analysts Leon Esterhuizen and Arnold van Graan say the industry is profitable, but still licking severe wounds from 10 years of underinvestment and high debt.

They say that while the basket price for platinum, palladium and rhodium has indeed been "extraordinary" of late, it foretells a lower future price as past spikes above this level have only ever lasted a few months.

"A damaging strike at this stage would cause excessive harm to the industry as it could remove what could be a once in a lifetime opportunity to get back to good health," they say. "It is most certainly not in labour’s best interest to undermine the current improvement in profitability … We don’t see a settlement above 10% and we see strike potential as very low."

Rene Hochreiter, mining analyst at Noah Capital Markets, says PGM producers cannot be sustainable in the long term if they continue to give inflation-plus increases. Hochreiter’s outlook for the platinum sector is "damn good", he says. "But you have to make sure to keep the purse strings tight. R17,000 a head is wrong."

Unlike the gold sector, wage negotiations for platinum are not centralised and take place at a company level.

This makes obtaining clear data on what companies pay staff tricky.

But R17,000 would constitute a 47% leap from the present Amcu estimate of a minimum wage of around R11,500 per worker.

Platinum prices, too, continue to languish at lows of $800 to $900 an ounce. The blame lies largely with the companies for ramping up production and grossly oversupplying the world market with a metal that can also be recycled.

Amcu is associated with a signature wage demand of R12,500, first launched in 2012. In general it has yet to achieve this for its members, however. But it says the new demands are based on a conservative average of 4.5% inflation over the past seven years and are realistic.

Most SA platinum producers have had little to say ahead of wage talks, which will probably begin in earnest next month.

But Sibanye-Stillwater, the world’s largest platinum producer, has been quick to say the demand is "impractical and unaffordable", noting that all stakeholders would be negatively affected if the company acceded to it.

Anglo American Platinum (Amplats) is in the best position: a major restructuring has left it with no debt and clear strong cash generation, Esterhuizen and Van Graan note.

Its Mogalakwena opencast platinum mine in Limpopo is one of the most profitable in the world. It’s also highly mechanised and Amcu doesn’t have much of a presence there. Amplats’s labour-intensive Amandelbult operations are most vulnerable, but earlier this month CEO Chris Griffith said the company had done a lot of work with employees ahead of the wage talks and didn’t get the sense there was much appetite for a strike.

Northam Platinum is also somewhat insulated. The National Union of Mineworkers is the dominant union at its Zondereinde mines, where a three-year wage agreement was concluded last year. At its Booysendal mine, near Mashishing, management will have to negotiate with Amcu.

Those on the western bushveld, Impala and Sibanye-Stillwater, are in the worst position, though it is in no-one’s interest for wage talks to turn into a strike.

"Certainly not while the prices are this high, allowing for significant debt relief and the returning capital strength needed to recapitalise the production base," say Esterhuizen and Van Graan.

The same goes for employees who are currently making good bonuses and will have noted the outcome of the recent five-month strike at Sibanye’s gold operations.

But there is a concern that hardened attitudes between Amcu leader Joseph Mathunjwa and Sibanye-Stillwater CEO Neal Froneman during Amcu’s long strike at the company’s gold operations could colour negotiations.

Mamokgethi Molopyane, mining and labour analyst, says: "This round requires strategy perhaps more than the previous ones, but it must be peppered with the reality of what’s happening in the sector and leaders will have to keep their personalities in check."

To be most closely watched is what unfolds between Amcu and Sibanye at its recently acquired Lonmin operations, where poor labour relations contributed to the Marikana massacre in 2012, in which 34 protesters were killed by police during a strike.

Sibanye and Amcu have been mostly conciliatory since the gold strike ended.

Molopyane says the political language of unions in SA must be balanced with the reality of the industries in which they operate. "Business and companies cannot afford protracted strikes, but workers will come off worst."

The original of the above report by Lisa Steyn appeared at BusinessLive (paywall access only)

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