FACT SHEET: HOUSING AND ACCOMMODATION

Transcription

1 HOUSING AND ACCOMMODATION Harmony s Masimong housing complex. South Africa s gold mining industry has always relied on migrant labour from other South African provinces and neighbouring countries such as Lesotho, Mozambique and Zimbabwe. In the past this resulted in migrant workers being accommodated in barrack-style hostels. The industry recognised the critical need to address the living conditions of its employees and has gradually upgraded living conditions in the hostels and houses provided to its workers, even before the Mining Charter came into being. As the mining sector seeks to provide a more stable housing environment for those living on mine property or in adjacent communities it has to be cautious not to cause economic fallout in the historical labour sending areas. All in all, this is proving to be one of the biggest transformation challenges confronting the industry. MINING CHARTER The Mining Charter, which was initially developed as a regulation to the Mineral and Petroleum Resources Development Act (MPRDA) in negotiations between government, organised labour and the industry in 2002 and implemented in 2004, required that mining companies establish measures for improving the standard of housing, including the upgrading of hostels, conversion of hostels to family units and the promotion of home ownership options for mine employees. The Charter requires that all mining companies and their operations submit Social and Labour Plans (SLPs), which detail how they plan to achieve compliance with the Mining Charter, as a pre-requisite for granting mining rights. AngloGold Ashanti, Gold Fields, Harmony and Sibanye Gold have all been granted new order mining rights at their operations on the basis of their compliance with the Mining Charter and the SLPs presented. Progress reports against these are made to the DMR on an annual basis. When the Charter was reviewed in 2009/10, the new version set more specific targets. It stated that mining companies must implement measures to improve the standards of housing and living conditions for mineworkers as follows: Convert or upgrade hostels into family units by end of 2014; Attain the occupancy rate of one person per room by the end of 2014; and Facilitate home ownership options for all mine employees in consultation with organised labour by the end of page 1

2 UNINTENDED CONSEQUENCES OF THE LIVING OUT ALLOWANCE In 1998, prior to the advent of the Mining Charter, the gold employers had agreed to a demand by the National Union of Mineworkers (NUM), to provide a living out allowance (LOA) to hostel dwellers who opted to leave the hostels and seek accommodation off mine property. The purpose of the LOA was (and is) to give employees an additional choice of residence, with the LOA intended to be used to support rental payment and board. The amount of the allowance (a minimum of R2,000 since September 2014) was directly related to hostel board and lodging costs and intended to support an equivalent standard of food and accommodation. Along with basic wages, the LOA has increased annually, often ahead of inflation, since it first came into effect. Unfortunately the LOA has given rise to unintended social issues. One of the critical social issues highlighted by recent labour relations instability in the mining sector is that the LOA has not necessarily been used by mining employees for its intended purposes and can actually be linked to the rapid development of informal settlements adjacent to the mines. Instead the funds are used to supplement the money sent by employees to their families in their rural homes or used for other spending and debt. It has now been suggested that a stakeholder review of the LOA and its unintended negative consequences is essential. It is worth noting that the gold industry, with its longer history and more entrenched hostel culture, has fewer informal settlements and to date been less affected by the scale of labour unrest and associated social instability, experienced by the platinum mines in the Rustenburg area. Rapid growth in the South African platinum mining industry from the mid-1990s until 2008, resulted in the development of sizeable, impoverished informal settlements close to the platinum mines, which were a focus of instability and unrest during the 2014 platinum industry strikes. In the gold sector some 50-60% of employees have voluntarily elected to remain in company hostel accommodation and, as a result, there have been fewer sizeable informal settlements close to the mines. In the platinum industry, which has fewer hostels, only about 10-20% of employees are resident in company accommodation with the majority of employees receiving the LOA and living in near-by informal settlements. PROACTIVELY ADDRESSING The large South African gold producers have made significant inroads in upgrading hostels and converting them to single accommodation units. Extensive new housing programmes have delivered houses to a number of employees and policies aimed at facilitating the ownership of affordable homes by employees are well advanced. Across the industry the programmes in place to deliver these commitments vary often on a mine-bymine basis as the age and location of the operation, the make-up of the workforce, affordability and the profitability of the mine all play a role. HOUSING WILL REMAIN A CHALLENGE IN GOLD The provision of decent and affordable housing and accommodation in the gold sector will remain a challenge for the industry, given the age of the mines, life expectancy of mines and that many mines are marginal in South Africa. But this is a challenge not only for the gold mining sector there has been rapid urbanisation into regions where employment opportunities have declined due to the shrinking sector. This is further exacerbated in mining areas, as thousands of people are attracted in search of jobs, thereby placing even more pressure on housing and infrastructure. Mining companies are increasingly being expected to shoulder a greater developmental burden in the regions in which they operate. MIGRANT LABOUR AND HOUSING Research and experience within the industry has shown that many migrant employees do not wish to move to mining towns on a permanent basis, preferring to maintain and return to their homes in rural areas. Providing permanent urban dwellings as well as urban home ownership is therefore not necessarily the solution to migrant labour issues. It s well known that migrant labour can result in the separation of families, often for extended periods of time, which in turn can lead to social issues such as the establishment of dual families one near the place of work and one in the labour-sending area. In order to address these concerns, the gold mining companies are exploring alternatives to current labour and work practices, which would enable employees to return home and spend time with their families more frequently and for longer periods. Key to this solution is exploring alternative shift arrangements and different shift cycles. INDEBTEDNESS AN ISSUE The development of employee home ownership programmes for those who wish to urbanise permanently is complicated by the inability of many employees to access bank credit as a result of bad credit records or over-indebtedness as well as the lack of availability of suitable land (with amenities) for development. The companies are currently looking at ways to address this. See the fact sheet Addressing indebtedness a gold mining initiative at page 2

3 CORPORATE HOUSING AND ACCOMMODATION PROGRAMMES BY COMPANY The concept of mine hostel living continues to carry negative connotations because of its history, although today s hostels are a far cry from those of the past. AngloGold Ashanti reported in 2014 that it was 98% of the way towards meeting the Charter s 2014 target of single accommodation (one person per room) for all hostel residents, and that it would meet that target on schedule. The company has spent almost $38 million (R420 million at the September 2014 exchange rate) between to achieve that goal. Furthermore, 100% of residences, previously classified as redundant have been converted into family units. Harmony, too, with 13% of residents living in single accommodation in 2013, said that it was on track to meet the 2014 target, at a total cost of more than R211 million. In addition, 900 family rental units will be completed by the end of The company is committed to converting another two hostels into some 1,100 family rental units units by end-2015 at a cost of R350 million. Sibanye Gold in 2013 had an average room occupancy rate of 1.15 and is intent on meeting the 2014 target. Up until 2013 R608 million had been spent on building new houses and on hostel upgrades together. A total of 644 new homes had been provided to employees. Gold Fields has spent R74 million on its hostel upgrading programme at its South Deep mine during 2013 and 2014 and will complete its Charter housing and hostel requirements by end It is working with banks and housing developers to expand its home ownership programme over the next few years. Below are some of the detailed statistics provided by the large four gold mining firms as at 30 June, 2014: ANGLOGOLD ASHANTI Number of single quarters 6 complexes of multi-story buildings Number of employees living in single quarters 8,929 Percentage of permanent employees living in single quarters 34% Number of units of family accommodation 5,444 Number of employees residing in family accommodation 4,980 accommodation 19% of employees Number of employees receiving LOAs 11,954 Percentage of employees receiving LOAs 45% Amount spent on housing and accommodation in 2013 R61.54 million GOLD FIELDS Number of single quarters 919 rooms Number of employees living in single quarters 995 (including longterm contractors) Percentage of permanent employees living in single quarters 28% Number of units of family accommodation 761 Number of employees residing in family accommodation 761 accommodation 22% Number of employees receiving LOAs 1,322 Percentage of employees receiving LOAs 38% Amount spent on housing and accommodation in 2013/14 R74 million page 3

4 HARMONY Number of single quarters 5,052 Number of employees living in single quarters 5,052 Percentage of permanent employees living in single quarters 58% Number of units of family accommodation 1,825 Number of employees residing in family accommodation 1,825 accommodation 6.2% Number of employees receiving LOAs 16,565 Percentage of employees receiving LOAs 64.8% Amount spent on LOAs in 2014 R367.4 million Amount spent on housing and accommodation in 2014 R224.5 million SIBANYE Number of single quarters 12,281 Number of employees living in single quarters 13,376 Percentage of permanent employees living in single quarters 39.65% Number of units of family accommodation 6,740 Number of employees residing in family accommodation 6,576 accommodation 19.50% Number of employees receiving LOAs 14,392 Percentage of employees receiving LOAs 42.6% Amount spent on LOAs in million Amount spent on housing and accommodation in 2014 R685 million DEVELOPING A FRAMEWORK FOR A SUSTAINABLE INDUSTRY In July 2013, the key social partners government, business and organised labour signed the framework agreement for a Sustainable Mining Industry. The agreement, which was developed under the guidance of the then Deputy President, Kgalema Motlante, recognises that the South African mining industry is central to the economy and job creation, and that the sustainability of the sector is crucial for the future of the country and its people. The agreement acknowledges the historical imbalances and the industry s legacy of over a century. It commits all parties to redress these imbalances, legacies and inequalities in mining. In relation to housing, the agreement commits the parties to the following: We recognise that the working and living conditions of many mine workers are not optimal. Housing and community development remains a key concern. Workers have to see rapid changes in their working and living conditions and visibly improved career prospects. We need to take urgent steps to build integrated communities with adequate social amenities, including labour sending areas. Regular meetings are being held between the parties to ensure that practical implementation plans are put in place to give effect to the agreement. page 4

5 PROGRESS TOWARDS 2014 MINING CHARTER TARGETS (AT 30 JUNE 2014) ANGLOGOLD ASHANTI GOLD FIELDS HARMONY SIBANYE Convert or upgrade hostels into family units by 2014 Attain the occupancy rate of one person per room by 2014 Facilitate home ownership options for mine employees in consultation with organised labour by R420 million spent on hostel conversions since 2004, creating 5,441 families. 98% on target by June On target to meet 1.0 by R100 million spent between 2006 and houses have been sold to employees. R24 million spent on hostel conversions since 2010, creating additional 123 families. Occupancy of 2.5 per room by June On target to meet 1.0 by Gold Fields owns 456 homes and rents 102 homes on behalf of its employees. KEY DEFINITIONS AND ACRONYMS R279 million spent on hostel conversions since 2000, creating rental 1,000 families. Occupancy of 1.70 per room by June On target to meet 1.0 by We have sold our houses below market value to employees. Total value to date is about R220 million. R178 million spent on hostel conversions and family units since 2000, creating accommodation for 762 families. Occupancy of 1.09 per room by June On target to meet 1.0 by R spent since houses built. CONTACT DETAILS: Charmane Russell Spokesperson acting on behalf of the gold producers Tel: LOA Living out allowance. MPRDA Mineral and Petroleum Resources Development Act. NUM The National Union of Mineworkers. SLPs Social and Labour plans. page 5