South African mining: Stuck in the past (Financial Times – April 1, 2014)

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Critics warn that the migrant labour system threatens the stability of important gold and platinum producers

Mcingelwa Maqotyna still remembers the humiliation that came with applying for the job: being forced to strip naked in a room full of other men, then stepping on to scales to be weighed.

Once he had landed the job, he travelled hundreds of miles from his village to a mine, where he had to get used to plunging deep beneath the surface of the earth at lightning speeds. Seeing the cage-like lift for the first time, he fearfully wondered if its exposed cables would hold.

For Nicolson Mkananda it was the contrast between the tranquil rural environment in which he had grown up and the hustle and bustle of life at a mine that struck him: the individualism, the strange languages and the strict control and discipline imposed on workers. “It was very, very frightening to go there,” he says.

These men, who left their remote villages near Lusikisiki in South Africa’s Eastern Cape in the 1960s and 70s, were part of a vast pipeline of cheap labour that allowed the country’s gold and platinum sectors to flourish. This system of migrant labour was developed during colonialism and extended under apartheid, becoming a pillar of the economy.

More than 20 years after the end of apartheid, migrant labour is still at the heart of South African mining – and remains a source of bitterness. How the industry addresses concerns over the migrant labour system will, experts warn, be central to the stability of some of the planet’s most important mines.

When a shocked nation sought to explain the unrest in 2012 in which police shot dead 34 st­riking miners in what became known as the Marikana massacre, the migrant labour system was singled out.

Marikana shook the country to its core and put the industry under intense pressure to change its ways. The sector, which includes Anglo American and AngloGold Ashanti, employs 500,000 people.

It also forced post-apartheid South Africa to re-examine the yawning disparities in one of the world’s most unequal societies.

The government, at national and local levels, was accused of failing to deliver basic services such as sanitation and water to informal settlements where many miners lived, amid mounting anger with corruption, incompetence and cronyism.
But companies were also accused of failing to address the lingering legacies of apartheid. Eighteen months later, the pressure on mining houses shows little sign of abating.

Any thoughts that labour relations were stabilising have been dashed by a strike in the platinum sector , now into its third month. It has already cost the top three producers – Anglo American Platinum, Impala Platinum and Lonmin – more than R11bn.

The union is demanding that the minimum wage be more than doubled to R12,500 a month. The average basic salary in gold and platinum is about R5,500, which mining houses justify by pointing to a national average of R3,700. To others, that is an indictment of the low wages paid in other sectors, such as R105 a day for farmworkers.

The platinum strike is the reason Mr Mkananda, a Lonmin miner, is back in his village near Lusikisiki, one of the traditional recruiting regions for miners. He refuses to discuss the stoppage, but says: “The life is still very tough for miners.”

Others have been more explicit in their condemnation of mining practices. Kgalema Motlanthe, South Africa’s deputy president and head of a government mining task force, told companies last year that the migrant labour system was a “scar on the face of democratic South Africa. Sadly the mining industry has remained a prisoner of its apartheid past in this core element of cheap labour.”

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