South Africa mines minister vows to break strike deadlock

JOHANNESBURG Wed May 28, 2014 1:52pm EDT

1 of 4. Miners on strike chant slogans as they march in Nkaneng township outside the Lonmin mine in Rustenburg May 14, 2014.

Credit: Reuters/Siphiwe Sibeko

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JOHANNESBURG (Reuters) - Deadlock in South Africa's crippling 18-week platinum strike will soon be broken after movement made on both sides of the wage dispute, the country's new mines minister Ngoako Ramatlhodi declared on Wednesday.

Ramatlhodi appointed a government team on Wednesday to try to resolve the impasse between the Association of Mineworkers and Construction Union (AMCU) and the world's top platinum producers. The team will meet the companies and union on Thursday at an undisclosed location.

"We will break the deadlock. I can say there has been movement on both sides," Ramatlhodi told Reuters.

The minister, who was sworn in on Monday, said that a "political intervention is necessary" after several rounds of negotiations failed to end the strike at Anglo American Platinum, Impala Platinum and Lonmin.

The country can't afford for the negotiations to continue as they have over the past few months, he said.

The platinum wage strike has crippled 40 percent of global production of the precious metal and has cost producers 20 billion rand ($1.90 billion) and counting, according to a live tally on a mining industry website. (here)

LIVING WAGE

The companies have offered pay increases of up to 10 percent, which would raise the overall minimum pay package to 12,500 rand ($1,200) a month by July 2017, including the basic wage plus cash allowances for necessities such as housing.

The producers say they can afford no more, squeezed on one side by soaring costs and on the other by low prices.

AMCU, whose battle cry has its demand for "a living wage", has said that the companies' offer is not enough and has focused the attention of its members on the basic wage, which excludes allowances. It wants that figure to be 12,500 rand in three or four years' time.

Ramatlhodi's other priorities include a possible review of the country's "mining charter", he said. The charter sets various targets for the industry, including 26 percent black ownership by 2014.

"We are going to have to re-look at the legislation ... There might be a review of the charter," he said.

Ramatlhodi has a reputation of being in the ruling ANC party's African nationalist wing, which believes that the South African economy remains too heavily concentrated in white hands.

Mining companies are also obligated to comply with other mining charter elements, such as humane housing and living conditions for mine workers and employment equality.

"It's very important to respect the human dignity of those people," Ramatlhodi said.

FOOD PARCELS

The strike, which is the main reason Africa's most advanced economy shrank in the first quarter of this year, is also taking a growing human toll.

In the mining town of Marikana, families stood in snaking queues on Wednesday to collect food parcels from charity organizations after more than four months without pay.

"This tinned stuff and bread will last for a week maybe," said Amplats miner John Diale, adding that he remains committed to the strike.

"These things won't give us money though. A living wage is what we need. We will carry on the way we have been."

($1 = 10.4987 South African Rand)

(Additional reporting by Mfuneko Toyana in Marikana; Editing by Joe Brock and David Goodman)

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