Cape Town - The sudden ups and downs of the rand saw mixed signals coming out of parliament yesterday about what should be done about it, and especially how mining houses should react.
In a speech prepared for the debate in the national assembly on her 2003/04 budget vote, minerals and energy minister Phumzile Mlambo-Ngcuka urged mining companies not to rush into retrenchment programmes on the back of the recent strength of the rand.
Reports that retrenchments were on the cards had raised doubts about the business models adopted by mines, especially ones that relied on retrenching workers when profits were lower but always rewarding management "in good and bad times", the text said.
However, possibly because of the weakening of the rand yesterday, she skipped this part of the speech when she actually spoke to the national assembly although several MPs expressed concern during the debate about the effect of the volatile rand on mining companies and jobs.
Mlambo-Ngcuka said retrenchments would be unfortunate given the bumper year experienced by most mines last year, with preliminary figures indicating that mining had contributed R30.6 billion or 8.5 percent of gross added value - an improvement of R13.9 billion from last year.
"A very pleasant surprise has been the fact that preliminary figures show a 1.5 percent rise in employment from 407 154 in 2001 to 413 087 in 2002 - the first recorded since 1986," she said.
She admitted that the last year had been dominated by "healthy and robust" debate with the industry on several key pieces of legislation and the mining charter and that this would continue this year as the Minerals Benefication Bill was processed by parliament.