For every person who works on a mine in South Africa, 26 other people benefit, South Africa’s latest anti-mine-nationalisation research document finds.
The 370-page study, which was funded by the mine-dependent Bafokeng community, follows the publication by the ruling African National Congress of the ‘State Intervention In the Minerals Sector’ (Sims) document, which also rejects mine nationalisation.
Bafokeng leader Leruo Molotlegi, in highlighting that every mining job represents 26 livelihoods, emphasises the far-reaching potential damage to South African livelihoods of any unsuccessful State intervention in the mining sector.
As the direct employer of 500 000 people, the South African mining industry thus underpins the livelihoods of 13-million people in South Africa.
In funding the study, the Bafokeng – 62 000 of whose community members are employed by the mining industry – partnered the Southern African Institute for Mining and Metallurgy and researchers from universities including Harvard, of the US, Lulea, of Sweden, and Wits, Stellenbosch and Cape Town universities, of South Africa, to create a better understanding of the social, economic and political impacts of State participation and nationalisation policies as they have been implemented in countries internationally.
Royal Bafokeng Holdings is the single biggest shareholder in platinum-mining major Impala Platinum and controls and operates the JSE-listed Royal Bafokeng Platinum company.
“As a community so heavily involved with mining, we have undertaken to support research on the issues related to State participation in the mining sector from a global and historical perspective. Our objective is to inform the debate through rigorous and exhaustive research.
“Although everyone agrees on the urgent need for greater economic justice in our country, a preliminary analysis of our research suggests that nationalising the mines in South Africa would not necessarily achieve the desired impact,” Molotlegi finds.
The Bafokeng benefit from being tax exempt, which is worth R220-million a year to the community.
“We are highly sensitive to the fact that the call for nationalisation is being driven by a sentiment that the benefits of the mining industry are distributed unequally and that there is little tangible benefit to the greater population.
“While there is direct community benefit from a model such as ours, government still benefits from its share of economic rents through the fiscal mechanisms employed by the State. We therefore contribute not only directly to the quality of life of our own people, but to the broader social economy and macroeconomy of South Africa,” Molotlegi adds.
The research finds that while it is clear that nationalisation is not a developmental option to addressing the popular issues around equitable distribution of wealth generated by the mining companies, it is equally clear that the popular anger at and frustration with the mining industry needs to be dealt with, failing which the sector will continue to be a political football.
To prevent that, the researchers proposed that a multi-stakeholder dialogue process be initiated to inform the debate at national level and that the dialogue process should endeavour to seek transparent consensus between government, business, labour, the investment community and civil society.