Numsa and Cosatu firmly oppose National Treasury’s plan to implement a youth wage subsidy.

This does not mean that the unions are indifferent to the challenges confronting the youth.

On the contrary, the federation and its affiliates have championed the cause of quality education and the youth and the right to a decent job.

In 2011Numsa’s legal department tabled a discussion document on the youth wage subsidy.

Cosatu recently released a detailed response on why it opposes the youth subsidy.

It raised the following concerns:

• The youth wage subsidy will have significant substitution effects.

Firms will have an incentive to let go of existing workers in order to employ subsidised ones … In addition, the existence of labour brokers who screen and manage workers for employers also makes it easy to fire existing workers and get “good ones” on a subsidised basis. (Cosatu, 2012)

• The youth wage subsidy does not guarantee that training and skills development will take place in the workplace

• The plan would put downward pressure on wages and potentially undermine collective bargaining

In its submission the federation also argues that National Treasury is failing to address the structural problems associated with youth unemployment and that the plan will only worsen the crisis of poverty, unemployment and inequality.

For its part, Numsa believes that the money allocated to kick-start the implementation of the youth wage subsidy would be better spent if Treasury adopted a more level-headed approach to the problems of youth unemployment.

It said: “In the short term we demand policies to keep youth in the education system.

The R5-billion that SARS will forego for the subsidy scheme should be used to invest in the FET sector to encourage young people with or without matric to gain skills prior to entering the labour market.” (Numsa, August 2011)

Source

Numsa News