NUM’s proposals for mining sector echo ANC’s research paper

National Union of Mineworkers says wholesale nationalisation will amount to a ‘technical bail-out of mining investors’

IN A likely precursor to what will happen at the African National Congress (ANC) policy conference next month, the National Union of Mineworkers (NUM) adopted at its national congress last week many of the proposals for state intervention in the mining sector contained in the ANC’s research paper on the topic.

Wholesale nationalisation was not strategic and would result in "nationalisation ofdifference between gyratory crusher and cone crusher mining debt and a technical bail-out of mining investors", the union said.

Like the ANC research paper, the NUM argues the government should achieve better leverage of SA’s mineral resources for development through, among others: a resource rent tax, which could be partly used to fund a sovereign wealth fund; a state-owned mining company; and the declaration of certain minerals as strategic.

Strategic minerals would have to be sold into the local market at "developmental prices", usually export-parity prices; and export tariffs would be imposed on strategic minerals.

The NUM also calls for a Presidential Mineral Sector Council (similar to the Presidential Infrastructure Co-ordinating Committee) to co-ordinate the work of different government departments that have a role in the minerals sector. This is a variation on the ANC paper’s suggestion of a super-ministry to play the role.

Discussions at next month’s ANC policy conference are being closely watched by investors and follow nearly two years of uncertainty since nationalisation was put on the agenda by the ANC Youth League. The ANC’s research paper, published in February, will form the basis of discussions on the mining sector. While it opposes nationalisation, many of its proposals will have far-reaching implications for companies doing business in the sector.

Other developments at the NUM congress — such as the re-election of general secretary Frans Baleni — can also seen as important indicators for likely events at the ANC’s national conference in December.

Mr Baleni was viewed as a supporter of President Jacob Zuma and the status quo, while his challenger, Oupa Komane, was identified with those who would like to see Mr Zuma replaced.

While Mr Baleni’s victory can be seen as translating into general satisfaction with Mr Zuma at the head of the ANC, the union stopped short of formally endorsing him for another term.

Although a draft resolution to the congress had proposed the NUM should lobby other Cosatu unions to support Mr Zuma’s re-election in December, this was toned down and in the end did not explicitly state this support.

Instead it was agreed Mr Zuma and his leadership team should be supported for the rest of their term. Thereafter, the general principle of continuity and the need to evaluate the skills and capacity of leadership should be taken into account when considering leadership choices.

"We said we support the leadership collective that emerged at Polokwane," Mr Baleni said. "We also said we have assessed their performance against the resolutions made there and realised there is progress in some areas and disappointment in others."

The cautiously phrased debate around the resolution left many delegates confused.

Many believed the congress had in the end supported Mr Zuma for a second term and several news reports were carried to this effect.

The NUM leadership election was the most highly contested in the union’s 30-years. Mr Baleni, who will serve his third term as general secretary, won about 60% of the vote after unprecedented scenes in which opposing groups rallied on the congress floor. All national office bearers were re-elected, including NUM president Senzeni Zokwana.

Mr Baleni said yesterday the NUM’s vision was to build a unified and growing union.

"You can only lead when there is unity. Those who have lost must now be led by those who have won, and those who have won should never purge those who have lost."