Cosatu general secretary Zwelinzima Vavi. Picture: SOWETAN
Cosatu general secretary Zwelinzima Vavi. Picture: SOWETAN

THE Congress of South African Trade Unions (Cosatu) rejects the youth wage subsidy — its stance has not changed, the federation’s general secretary, Zwelinzima Vavi, said on Tuesday.

The African National Congress (ANC) on Monday denied any conflict with Cosatu, saying there was "general agreement on the approach" to youth employment support and incentives schemes, which may include the subsidy.

Cosatu has been at the forefront of opposition to the subsidy, blocking its implementation for nearly two years.

"Cosatu’s position remains clear that the youth wage subsidy will not solve youth unemployment. It has not worked anywhere else in the world and it will not work here. We reject it out of hand," Mr Vavi said on Tuesday.

Comments by ANC leaders after their recent lekgotla suggested that the subsidy — or a form of it — may be included in the raft of "youth employment incentives", to be announced in President Jacob Zuma’s state of the nation address next week.

Subsidising "the cost of hiring younger workers, to encourage firms to take on inexperienced staff" was first raised in his 2010 opening of Parliament speech and budgeted for in 2011.

The Progressive Youth Alliance — which includes the ANC Youth League and the Young Communist League, which also opposed the subsidy when it was first mooted — said yesterday they were confident the "discredited" idea would not be introduced through "the back door".

Mr Vavi said Cosatu was not opposed to youth employment incentives, although "it depends on what we are talking about".

He said there were already many incentive schemes in the economy, including in the motor industry and in agriculture, which Cosatu actively supported.

These schemes, he said, enjoyed "broad agreement" between the ANC and Cosatu.

Cosatu president Sdumo Dlamini, who attended the ANC lekgotla last week in his capacity as a member of the party’s national executive committee, said on Tuesday the youth wage subsidy should "not be spoken about at all", but unemployment incentives should be supported.

The difference, he said, was that the youth unemployment incentives were driven by the state and included training, employment and protection under the labour laws.

The youth wage subsidy was proposed to be driven by the private sector, where young workers would be subjected to "subminimal labour standards" and there was a risk older workers would be replaced. "We stand opposed to the youth wage subsidy, but what is being missed (by the media) is that the ANC is talking about youth employment incentives," Mr Dlamini said.

He admitted the subsidy may be a "small element" of the ANC’s new proposals, but it was part of a raft of measures and was not its central focus.

Cosatu would wait and see what the proposals were, and would discuss them in the alliance with the ANC and the South African Communist Party — and at the National Economic Development and Labour Council (Nedlac). Labour, business and the state are set to sign a youth social accord at Nedlac soon. A social pact signed between the parties last year indicated that the accord would include a national youth service programme in which young people would be recruited to work at public health facilities and in rural development projects.

It also pointed to employment "set-asides" for young people in key sectors of the economy, and private sector commitments to draw young people into employment and training.

Buti Manamela, Young Communist League secretary-general, said while the "discredited" youth wage subsidy would only benefit business and create tension in the labour sector, the youth alliance would back other incentives, including a job seekers grant.

Government incentives for youth employment should go to the "pockets of young people", he said.

With Karl Gernetzky