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Last Updated: Wednesday, 10 August 2005, 08:03 GMT 09:03 UK
Talks fail to end SA gold strike
South African striking mineworkers
The workers want better conditions in hostels and higher pay
Some 100,000 South African gold miners are on indefinite strike in the first national stoppage in 18 years.

The strikers, members of the National Union of Mineworkers (NUM), are protesting about both pay and living conditions in the industry.

Management is offering pay rises of 5%-6%, but the union says this fails to take into account rising gold prices.

Talks on Tuesday failed to bridge the gap between the two sides although the there was some progress reported.

About 80,000 municipal workers are also on strike over pay, amid reports of clashes with police.

Talks between the municipal workers' union, Samwu, and the South African Local Government Association are continuing despite the action.

The union called the "indefinite" strike after three days of action earlier in August and another day in July failed to produce an improved offer.


The mining stoppage could cost about $12m in lost revenue a day, analysts estimate.

It is one of the biggest labour disputes since the end of apartheid.

I don't think the industry can afford a strike, but am absolutely convinced the industry cannot afford the wage increases
Bernard Swanepoel, chief executive, Harmony Gold

"I don't think the industry can afford a strike, but am absolutely convinced the industry cannot afford the wage increases," said Bernard Swanepoel, chief executive of Harmony Gold.

But the NUM says that since both gold prices and the value of the rand have shot up over the past two years, the miners - who often work in 40C heat up to 3km below ground - deserve a bigger share of the returns.

And a second union, Solidarity, looks set to join the dispute.

Most Solidarity members are white and it is rare for it to take industrial action alongside the mainly black NUM.


South Africa is still the world's biggest producer of gold bullion - accounting for around 15% of world gold output - and the sector accounts for approximately 8% of the country's gross domestic product.

But its share of the world gold market has declined sharply in the last few decades from 80%, as other producers in developing countries have come on stream.

South African gold miners
South Africa is the world's biggest producer of gold bullion

The strike action began on Sunday at 1600 GMT after the NUM terminated talks with the Chamber of Mines, representing the employers.

The meeting that day had produced a higher pay offer, up from the previous 4.5%-5%, as well as the promise of bonuses to the union paid as the price of gold rose.

But that was "not good enough", NUM negotiators said. The union is calling for a 12% pay rise.


A key part of the union's dissatisfaction is that it says the big mining firms - AngloGold Ashanti, Gold Fields and South Deep - have yet to address long-standing problems with miners' living conditions.

Under apartheid laws miners were forced to live in barracks, leaving their families in townships far away.

Even though the racial zoning laws were struck down by 1991, ahead of 1994's landmark multi-racial elections, about three out of four of South Africa's 200,000 miners still live in hostels.

AngloGold Ashanti says there is an average of six men per room in its hostels, down from 12 a decade ago. Harmony says its hostels average 4.2 men per room.

The union now wants the "living-out allowance" for finding family accommodation to be doubled, whereas the mining firms are offering only a 10% rise.

The employers say they are working to improve hostels, but cannot move faster without jeopardising jobs.

"It's a tremendously expensive exercise," Mr Barker told Reuters.

The NUM says the crowded hostels are a breeding ground for tuberculosis.

It also warns that South Africa's Aids pandemic is worsened by the system, since miners far from home are more likely to visit prostitutes.

See inside a mine in South Africa

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