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Kwanalu

The voice of agriculture . Die stem van landbou . Izwe lezokulima

Snelle verhoging van die nasionale minimumloon belemmer groei in die landbousektor | Rapid increase of the national minimum wage is throttling agricultural sector growth

English to follow:

16 August 2023

Agri SA sal ’n voorlegging aan die parlement doen wat die negatiewe uitwerking van die nasionale minimumloon op die groei en volhoubaarheid van die landbousektor toon. Tensy die verhogings van die minimumloon in die landbousektor met inflasie ooreenstem, is daar ’n werklike risiko dat indiensneming in die landbousektor met verwoestende gevolge vir die sektor kan inkrimp.

Hoewel die landbousektor hom merkwaardig veerkragtig bewys het te midde van talle krisisse, veral die voortslepende impak van die Covid-19-pandemie, begin die druk op die sektor wys. Die sektor het in 2020 met 17,8% gegroei, maar was groei net 7,4% in 2021 en ’n marginale 0,9% in 2022. Hierdie stadiger groeitempo word weerspieël in die arbeidstatistieke wat vandeesweek deur Statistieke SA vrygestel is, wat ’n 0,8%- kwartaal-tot-kwartaal toename in indiensneming in die landbousektor getoon het.

Die afname in die landbousektor se wibnsgewendheid is die gevolg van stygende insetkoste, waarvan arbeid die belangrikste is, en wat 25% van alle produksiekoste uitmaak. Daarom is die nasionale minimum ’n geweldige las op die sektor, wat die reeds verlammende eksterne druk op boere vererger. Nywerhede soos die suikerrietsektor staar byvoorbeeld reeds enorme stygings in die koste van kunsmis in die gesig as gevolg van die Russiese inval in Oekraïne. Terselfdertyd ondervind bedrywe soos sitrus ook finansiële druk met betrekking tot die koste van verskeping vir uitvoergoedere as gevolg van Suid-Afrika se gebrekkige pad-, spoor- en hawe-infrastruktuur.

Al hierdie drukfaktore op die sektor het gelei tot ’n vinnige toename in die totale boerderyskuldlas op boere. In 2006 het boerderyskuld op R37,7 miljard gestaan. Teen 2022 het die skuld op R205 miljard gestaan. Dit is ’n toename van 442% oor 15 jaar.

Hierdie skuldlas het gestyg as gevolg van een fundamenteel misverstaande dinamika in die sektor: boere is prysnemers, met geen beheer oor pryse buite die plaashek nie. Plaaslike en internasionale kleinhandelaars stel die pryse vas en verhogings soos die nasionale minimum loon vorm nie deel van hul oorwegings nie. Indien kleinhandelaars nie pryse verhoog namate insetkoste styg nie, word boere gedwing om daardie bykomende koste te absorbeer. Hierdie dinamika word vererger deur uitdagings vir marktoegang, wat ’n groter surplus produkte op die plaaslike mark tot gevolg het. Dit verlaag die prys wat produsente kan verkry.

Die gevolg van dié opgehoopte uitdagings is groter druk op Suid-Afrika se voedselproduksie. Dit benadeel beide die vermoë van die landbousektor om die land se voedselsekerheid te waarborg en sy vermoë om werkgeleenthede in die sektor te handhaaf en uit te brei. Die enigste manier om voedselsekerheid te beskerm en indiensneming in die sektor te bevorder, is om die kostedruk op die sektor te beheer. Terwyl baie van die bydraende koste buite ons beheer is, is die nasionale minimumloon stewig binne die regering se beheer.

Agri SA herhaal dus sy beroep op die regering om voedselsekerheid en werkbeskerming te prioritiseer in die bepaling van die nasionale minimumloon. Dit is ’n kritiek belangrike verbintenis van die regering as die land sy voedselsekerheid wil handhaaf en noodsaaklike werkgeleenthede in die wankelende ekonomie wil beskerm.

Medianavrae:

Johan Wege

Voorsitter van Agri SA se Sentrum van Uitnemendheid: Arbeid

Thulile Sikhosana

Agri SA-administrateur: Arbeidsentrum van Uitnemendheid

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16 August 2023

Agri SA will be making a submission to Parliament which demonstrates the negative impact of the national minimum wage on the growth and sustainability of the agricultural sector. Unless the increases of the minimum wage in the agricultural sector are aligned with inflation, there is a real risk of the agricultural sector contracting with devastating effects for employment in the sector.

While the agricultural sector has proven remarkably resilient in the face of numerous crises, most notably the lingering impact of the Covid-19 pandemic, the pressure on the sector is beginning to show. Whereas the sector grew by 17,8% in 2020, it only grew by 7,4% in 2021 and a marginal 0,9% in 2022. This slower pace of growth is reflected in the labour statistics released by Stats SA this week which showed a 0,8% quarter-on-quarter increase in employment in the agricultural sector.

The decline in the agricultural sector’s profitability is the result of rising input costs of which labour is the most significant, constituting 25% of all production costs. For this reason, the national minimum constitutes a tremendous burden on the sector that is exacerbating the already crippling external pressures on farmers. Industries like the sugarcane sector, for example, already face enormous increases in the cost of fertiliser as a result of the Russian invasion of Ukraine. At the same time, industries like citrus also face financial strains in relation to the cost of shipping for export goods as a result of South Africa’s failing road, rail and port infrastructure.

All these pressures on the sector have led to a rapid increase in the total farming debt burden on farmers. In 2006, farming debt stood at R37,7 billion. By 2022, the debt stood at R205 billion. This is a 442% increase over 15 years.

This debt burden has risen as a result of one fundamentally misunderstood dynamic in the sector: farmers are price takers, with no control over prices beyond the farm gate. Local and international retailers set the prices and increases such as the national minimum wage do not form part of their considerations. If retailers do not increase prices as input costs rise, farmers are forced to absorb those additional costs. This dynamic is exacerbated by market access challenges that result in a greater surplus of produce on the local market, lowering the price that producers can obtain.

The result of these accumulated challenges is greater pressure on South Africa’s food production. This compromises both the ability of the agricultural sector to guarantee the country’s food security and its ability to maintain and expand employment opportunities in the sector. The only way to protect food security and promote employment in the sector is to control the cost pressures on the sector. While many of the contributing costs are out of our control, the national minimum wage is firmly within government’s control.

Agri SA is therefore reiterating its call to government to prioritise food security and employment protection in the determination of the national minimum wage. This is a critical commitment from government if the country is to maintain its food security and protect vital jobs in our flailing economy.

Media enquiries:

Johan Wege

Chair of Agri SA’s Centre of Excellence: Labour

Thulile Sikhosana

Administrator: Labour Centre of Excellence