§ Mr. Sandelsonasked the Secretary of State for Trade if he has made an assessment of the information published or made available by firms in response to the White Paper, Command Paper No. 5845, on their employment practices in South Africa.
§ Mr. DellWe have studied the information published or made available by firms up to February of this year and I am arranging for an assessment to be published in theOfficial Report. It bears out the indications given in my written reply of 15th February to the hon. Member for Birmingham, Perry Barr (Mr. Rooker) that the information shows progress in improving African wages and some improvement on fringe benefits and other aspects mentioned in paragraph 5 of Cmnd 5845. I shall invite fuller and more consistent coverage of these aspects in the guidance I propose to issue with Ole Code of Conduct of the Nine.
EMPLOYMENT PRACTICESIN SOUTH AFRICA
BRIEF ASSESSMENT OF BRITISH FIRMS' PERFORMANCE
(Based on published information)
This assessment is based on reports published by British companies or on information tent to the Department of Trade between 1st January 1975 and 28th February 1977. Companies provided this material in response to an invitation in a White Paper (Cmnd. 5845) to publish information on the progress made by their South African subsidiaries towards attaining the level of African wages and other conditions of employment advocated in the Code of Practice defined by the TISC Report.
2. This current assessment is based on 189 reports, of which only 43 provided fully the information requested by the White Paper. These 43 reports related in aggregate to 52,080 African employees. Another 53 reports, relating to 48,324 African employees, provided substantive information on African wage rates but less, or none, on other important matters covered by the Code of Practice. The absence of standardisation in the form of reply has made analysis difficult—indeed almost impossible.
WAGES AND THE PDL/MEL*
3. Using guidance on PDL/MEL levels provided by the University of Port Elizabeth and the Johannesburg Chamber of Commerce, the reports showed that there were:
7 companies with 728 employees below the PDL
116W49 companies with 20,183 employees below the MEL
29 companies with all employees (number not known) above the MEL
13 companies with no timetable for achieving the MEL
3 companies aiming to achieve the MEL in 1976
4 companies aiming to achieve the MEL in 1977
7 companies aiming to achieve the MEL in 1978
4 companies aiming to achieve the MEL in 1979
2 companies aiming to achieve the MEL in 1980
1 company aiming to achieve the MEL in 1981
* The TISC report concentrates on the PDL (Poverty Datum Line) and MEL (Minimum Effective Level) as criteria for minimum wages in South Africa. The PDL is intended to measure "the lowest possible amount on which a family can live under humanly decent conditions in the short run" ie. the barest minimum. The MEL has become by a "standard rule of thumb" 150 per cent. of the PDL and the TISC guidelines urge companies "to accept the MEL as the target for minimum wages, and to establish a timetable for achieving it".
4. By comparison with the minima quoted in the TISC report, the data published subsequently by companies shows an increase in minimum wage rates as indicated by the following table:
Absolute increase in minimum wages p.a. percentage Number of companies 0–20 5 20–40 25 40–60 12 +60 4 Although limited in the number of companies covered, these figures probably reflect a general position. The increases occurred mainly during the earlier part of the period 1973–1976 in the aftermath of the parliamentary inquiry and the interest it generated. As a yard-stick, during the period 1973–1975 Black wages in South Africa rose in real terms by an average of 8 per cent. Using annual rates of inflation of 10 per cent.-15 per cent. in this period, on the basis of the indications provided by the above table the increases in British companies were generally above average in real terms also.
5. There were substantial adjustments, too, at higher wage levels. Overall increases in Black wages during the period 1973–1975 averaged as follows:
Percentage Mining — 67.6 p.a. Manufacturing — 30.7 p.a. Construction — 38.8 p.a. Finance/Insurance — 36.1 p.a. Trade — 18.5 p.a. Recent figures in South Africa have indicated that the average monthly wages in the following industries in December 1976 were:
117W
Mining R98.80 (plus accommodation, food, etc. valued at R30 pm)
Manufacturing R158.63 Construction R128.99 Where wages in 1976 were quoted by British companies they were generally at or above these averages.
FRINGE BENEFITS
6. The TISC guidelines referred to the case "for companies to provide benefits in kind … if the benefits would otherwise be provided inadequately or not at all". Certain reports contain an impressive list of fringe benefits; others make no mention of the subject, and between the extremes a variety of situations exist. An analysis shows that United Kingdom companies provide the following forms of fringe benefits:
Number of Companies Education schemes for employees and/or families, including bursaries 24 Subsidised canteens 32 Pension and retirement funds 60 Free medical facilities and/or medical aid schemes 33 Bonus leave schemes 11 Death benefit or burial insurance schemes 4 Long service awards or bonuses 16 Protective clothing 21 Accommodation / housing / furniture loan or assistance schemes 15 Life, accident, insurance schemes 11 Sports facilities 6 Savings schemes 4 Free or subsidised transport 6 Leave, sick leave, compensation for injury an unemployment insurance have been excluded from this list as they are requirements. Sixteen reports state that employees were given longer periods of paid annual leave than required by law. Several companies also provide longer periods of paid sick leave than required by law. A number of companies are known to have taken part in sponsoring benefits for persons not necessarily in their employ, for example, sporting activities, provision of schools and hospitals, creation of educational trusts and training centres, supply of equipment to hospitals and educational institutions.
7. The reports do not disclose how many of these benefits have been introduced in response to the Code of Practice defined in the TISC Report.
TRAINING AND AFRICAN ADVANCEMENT
8. Of the 189 reports examined, only 34 specifically mention Black training. An additional nine refer to Black advancement as company policy. Some report that job evaluation and job grading systems have been introduced to provide promotion prospects through training and additional responsibility. Several British subsidiaries have developed this system in the steel and engineering industries where the employers' organisation (SEIFSA) has concluded an agreement with the White trade unions to accept Black labour up to the second top category of skilled worker.
118W9. Seven reports refer to training at Government training centres or at industry-sponsored centres for operatives at semi-skilled level. A number of companies also refer to Africans employed in semi-skilled and skilled grades, and junior supervisory and managerial posts. Banks and insurance companies are now known to be using Blacks at more senior levels. In this upward movement, the Black labour involved has replaced other racial groups but the numbers involved are not known. The movement is believed, however, to have been substantial up to semi-skilled grades, but very limited above that level.