NUM ‘shocked and disappointed’ by halting of Mining Charter implementation

The  National Union of Mineworkers (NUM) said on Friday that it was “shocked” and “disappointed” by the temporary suspension of the controversial Mining Charter pending the outcome of the Chamber of Mine’s urgent interdict, saying that it would be exploring legal possibilities in a bid to challenge it.

This comes after Mineral Resources Minister, Mosebenzi Zwane, on Friday gave a written undertaking that his department will not implement or apply the provisions of the 2017 Reviewed Mining Charter in any way, pending judgement in an urgent interdict brought by the Chamber of Mines.

Zwane has furthermore undertaken that, in the event of any breach of the his undertaking, the Chamber can set the urgent interdict application down for hearing on 48 hours’ notice to him.

“The  National Union of Mineworkers (NUM) has noted with shock the recently reported agreement between the Chamber of Mines and the Department of Mineral Resources in court papers filled in the High Court, which “delays” the implementation or enforceability of the recently gazetted Mining Charter till the September 2017 court date,” the union said in a statement.

“We are extremely disappointed with the Minister of Mineral Resources who seem to buckled under pressure in court and conceded in the suspension of the mining charter and thus delayed the meaningful inclusion of employees and communities in this exploitative industry. We expected no less from the Chamber of Mines, whom we feel their actions have attacked every essence of transformation in the mining industry.”

The Reviewed Mining Charter has been vehemently rejected by the industry, with the Chamber saying that the Department of Mineral Resources (DMR) had not had meaningful consultations before the introduction of some of the items, and thus it would approach the courts to stop the department from implementing it.

NUM was among a few who welcomed it though it said that government-set targets for black ownership of the country’s mineral wealth could have gone further.

The Reviewed Charter’s targets include new mining rights holders having 30 percent black ownership to be shared among employees, communities and black entrepreneurs. Mining rights holders who have complied with the previous target of 26 percent have to “top up” to 30 percent within 12 months.

NUM said the DMR should decisively deal with all mining companies that failed to comply with the previous Mining Charter 2014 targets, and thus should be suspending and withdrawing all those affected mining rights.

“We will be consulting our legal unit to explore possibilities of challenging this court (order) “agreement” between the Chamber and DMR, as the transformation in the mining industry, affects all of us, especially employees and communities,” the union said.

“The NUM would like to appeal to the Department of Mineral Resources to stop tip toeing around transformation and its constitutional obligations of redressing the imbalances of past.”

The Chamber of Mines announced on Friday that Mining Minister Mosebenzi Zwane’s controversial new Mining Charter that requires mines to be 30% black-owned has been suspended, pending a legal challenge by the chamber.

The chamber had applied for an urgent court interdict to stop the implementation of the charter, which was announced last month.

During a presentation on Thursday, Finance Minister Malusi Gigaba underscored the importance of the mining industry to growth and employment and mentioned to Moneyweb that he had met with the Chamber of Mines this week to try to understand what was going on.

He said that he was “trying” to suspend the implementation of the charter while the legal process unfolded.

Chamber of Mines chief executive Roger Baxter had confirmed that the meeting had been cordial and “well-intentioned” between the minister and the chamber.

Zwane has flown to Chile to take part in the Latin American Mining Conference.

On Friday the Chamber of Mines said Zwane had provided a written undertaking that government will not implement or apply the provisions of the charter in any way until the urgent interdict application has been dealt with.

Among the most controversial aspects of the charter are:

• An increase in BEE shareholding of all mines from 26% to 30%.

• The requirements that 50% of all board members and executive management must be black.

• That 70% of all mining goods and 80% of all services in the mining industry must be procured from BEE suppliers.
• The new charter would also require 50% plus one black shareholding in a company for prospecting rights to be granted.

The Democratic Alliance (DA) has welcomed the move.

DA spokesperson on finance, Alf Lees, said the release of the latest version of the Chatter caused an “astounding R50 billion” market value loss in mining shares, in just one fell swoop.

“It must said that the DA supports share schemes for miners when they are structured to benefit the workers and are economically viable,” Lees said in a statement.

“However, the Mining Charter was not designed to benefit miners but instead to make cronies and insiders richer, as they open up new opportunities to get in on mining deals.”

Based on the written undertaking, the Chamber of Mines has acceded to the Department of Mineral Resource’s request for extra time to prepare its answering affidavit to the interdict application and for the hearing to take place on a later date. The hearing was scheduled for Tuesday, July 18.

The parties have also asked the deputy judge president of the High Court to allocate a hearing date in September 2017. This date is subject to allocation by the deputy judge president, which is expected to occur by around the end of July.

Lees said government would do well to take this opportunity to review the Charter and to present an effective plan that would attract investment, create jobs and benefit the country’s people, not just the connected few.