Johannesburg - Cosatu has a budget shortfall of more than R14 million for this year, according to its budget forecast presented to a top-level meeting in Joburg this week.
This does not include R7m the federation is going to have to find for its national congress. While finding cash to sponsor a congress every three years is not normally a crisis, to start with a massive deficit is going to make the situation more difficult.
Cosatu’s political disintegration is having an enormous impact on its finances. Since the expulsion of metalworkers union Numsa last year, Cosatu’s finances have come under increased strain. The union, which is the largest in the country with around 340 000 members, contributed R900 000 a month, or just under R11m a year, in affiliation fees.
This excludes other levies and financial contributions now no longer coming to the federation. The situation is compounded by existing affiliates regularly missing affiliation payments to the federation as most unions face their own internal cash crunch.
Cosatu is now considering a number of cost-cutting exercises, with some unionists even speculating that the federation, which is plagued by infighting over various issues, will not go ahead with its congress this year. The gathering is meant to elect new leaders and decide on Cosatu’s political direction.
The union’s financial committee has drawn up a financial advisory report, a copy of which The Star has seen, detailing five possible scenarios of income and expenditure.
The worst-case scenario, which has Cosatu at its current membership of 1 875 238 and with unions refusing to pay affiliation fee increases, projects income of just over R65m. This would result in no salary increases for staff, and overhead and activity expenditure dropping by millions of rand.
The second scenario explores the possibility of unions agreeing to an increase of 6 percent in affiliation fees, meaning that there could be a salary hike of 5 percent for the lowest-paid staff and 3 percent for the highest paid. But even under this more upbeat scenario, certain posts will have to be frozen.
One scenario interestingly admits the possibility of Numsa remaining in the federation.
Under this state of affairs, the federation’s membership remains steady at the 2014 figure of 2.193 million, rather than the Numsa-free 2015 figure of 1.875 million. With Numsa and no increase in affiliation fees, Cosatu’s income jumps to R76 540 955. Adding a 6 percent hike in affiliation fees would give the federation R81 352 222 for the year.
A list of the cost-cutting measures on the table gives a glimpse to how dire the situation has become for Africa’s largest labour federation.
One of the most severe cuts is a proposed total freeze of the economic policy unit. This would mean that the federation, which is meant to drive a pro-worker agenda through research and policy development, would be hamstrung.
Other vacancies which could be frozen include the head of its parliamentary unit, who leads Cosatu’s engagement on legislation, and the education secretary in charge of developing worker-education programmes.
General secretary Zwelinzima Vavi would have to forgo the luxury of a personal assistant in his office. The retrenchment of two bodyguards could also be considered, and there is a mooted change of medical aid.
On operational expenditure, it is suggested that the per diem for foreign travel be reduced from $100 (R1 180) to $50, among many others.
Labour Bureau