Economic Development Minister Ebrahim Patel is the ultimate trump card in Cosatu's bid to influence and even direct government policy in President Jacob Zuma administration.

Some political observers go to the extent of saying the battle as to whether Cosatu becomes the tail that wags the dog will be won or lost in Patel's office.

His role, according to government head of policy Joel Netshitenzhe, is to "synergise macroeconomic and microeconomic policy".

"There has been a concern about poor articulation between macro- and microeconomic policy.

"Treasury will work in relation to actual budgeting.

"What falls out of the normal budgeting process will lie with the new department," Netshitenzhe explains.

Make no bones

Cosatu general secretary Zwelinzima Vavi is adamant that Patel's ministry should be charged with coordinating macro- and micro-economic policy.

"This means removing the responsibility of coordinating the country's macro-economic strategy from Treasury and also moving the responsibility of coordinating micro-economic policy strategies from the Department of Trade and Industry.

"We know that conflictual statements have been made even by the ministers about their role and that of the economic development minister.

"We have had discussions with the president and he made it clear that the economic development minister is the one who is going to be coordinating economic policy," Vavi says.

He says as far as Cosatu is concerned economic policy includes industrial strategy.

At present the Treasury drives implementation of the macro-economic policy, while Trade and Industry is charged with driving the micro- economic strategy.

Patel says one of his key tasks is to make sure that the promise made by President Jacob Zuma — of creating 500 000 job opportunities by Christmas — does not become pie in the sky.

"Mission improbable"

"These numbers have been generated by a major review of the past couple of months of the expanded public works programmes.

"In February this year we entered into an agreement between business, labour and government that sought to answer how South Africa should respond to the global financial crisis," Patel said.

He also believes that extending the government's public works programme will go a long way to help achieve the target.

"The jobs created under these programmes are not the same as permanent manufacturing jobs but, very importantly, provide opportunities for young people and the disabled who have been outside the economy to come into paid employment," Patel says.

He also says a lot of research had gone into the figure of 500 000 jobs, which translates to 2380 jobs a day.

"It's the beginning of absorbing our people into jobs," he says.

"We've been working for the past couple of months on putting the infrastructure in place to realise the 500000 job opportunities."

R787-billion infrastructure programme

"The big question is — how do we increase the employment income of that R787-billion?"

The Department of Economic Development is also tasked with finding solutions to Zuma's assertion that "workers who would ordinarily be facing retrenchment owing to economic difficulty will be kept in employment for a period of time and reskilled".

The government wants to encourage companies and labour to consider lay-off periods during which workers will be reskilled, says Patel.

"The question is, how do we finance this?" Patel asks

"The UIF (Unemplyment Insurance Fund) only pays out when someone becomes unemployed but we want to turn it into some form of active labour market instrument to help avoid retrenchments."

Patel sounds optimistic but the target set by Zuma is a tall order in an economy that has shrunk by 6.4 percent in the first quarter, shed 208 000 jobs and is expected to shed a further 750 000 by December.

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