Select Committee on International Development Minutes of Evidence

Examination of Witnesses (Questions 300 - 319)



  300. Have you got a perception of what happens across the employment sector?
  (Mr Wheeler) There are companies that do tests and I am sure companies do make decisions based upon that. The other thing we should be aware of is that you are talking to a few companies, if you like, who are testing voluntarily and have got a programme in place. The vast majority do not.

  301. If you have got a person who wants to be a miner in your company you would give them medical tests?
  (Dr Brink) We do a pre-placement medical examination. It does not include an HIV test. The purpose of that examination is to see that they can do the job. If it is underground it is a physically strenuous job. You have to be well enough to do that.

  302. Can I move on to what you do within the workforce to combat discrimination against those who are HIV-positive.
  (Ms Crisp) I think education is the most important thing and we have found in companies where we have had good education programmes and we have focused predominantly on peer education programmes, then people are very aware that they are not likely to become infected simply by working next to somebody who is HIV-positive. As long as that education process has taken place, then we have found, and it has certainly been my experience with my own employees, that colleagues are very empathetic, very supportive, even though they know that their colleague is HIV-positive. In situations where that education process has not taken place then you will find people reacting and not wanting to associate with them and drink out of the same cup. It is really a question of education programmes in the workplace and that is one of the reasons why we have placed so much emphasis on that, not just on how you stop becoming infected but how you work alongside somebody who is HIV-positive.

  303. That all sounds very positive, as if there are education programmes going around across the economy firm after firm after firm and it is smoothly happening. Is that the picture you want to get across?
  (Dr Brink) Certainly in a big company and for any company you have to take the leadership from the top and that means setting a policy. You have to have an HIV/AIDS policy and firmly rooted in that policy must be the principles of non-discrimination. Firmly rooted in that policy must be a commitment to education and a prevention programme, and it is no good if it is a policy that lies in the bottom drawer. It is something that has to be communicated out to all the operations and the senior management must become involved. They have to be part of the response to this AIDS epidemic and know that it is a requirement of their job that they deal with it according to policy. By making that flow through the workforce, I think one can ensure then that you have got a better chance of eradicating any form of discrimination. I think also there is a huge opportunity with HIV/AIDS to join with trade unions because this really is a problem that affects all of us. One would like to see the trade unions adopting a similar policy. Very often these policies are jointly negotiated and by getting that through it is something that is everybody's problem and this is how we are going to deal with it. I think that is the best way to go forward.

  304. If I can give a particular example on policies. We went to Carltonville and if I were to say the one thing the company could most do to prevent the build-up of HIV-positive testing in this area, it would be to abandon migrant labour, to start setting up communities, would you agree with that?
  (Dr Brink) It is a complicated issue. One has to look at migrant labour in its entirety. I think one has to set it in the context of Africa where it is commonplace. It does not relate only to the mining industry. It relates to transport, it relates to the construction industry. It is a particular problem and I think that one must remember that this HIV epidemic is fuelled by poverty and unemployment and very often the only opportunity for people to get employment is to travel to get that employment. So one has to see it in its broader context. That said, clearly when a person is away from the spouse that creates a climate which may be conducive to high-risk sexual behaviour and we certainly in our company are using every effort to try to rely much more on local employees to protect and preserve the family unit as one of the responses in trying to prevent the advance of the epidemic. It is a very strong thrust of ours. We have to live with the fact that it is a feature of life in Africa and we have to find ways and means to cope with that.

  305. Can I move on to the impact that the virus is having upon the effectiveness and efficiency of firms and where you are seeing this impact on the skills of your workforce. Because of loss of skills, are you having to recruit from elsewhere, even outside Africa? One of our earlier witnesses was talking about Botswana and Botswana buys in Sri Lankans, Bangledeshies and people from the Far East and so on. Can you take us through how this virus as it has built up is having an effect on the effectiveness and efficiency of your workforce?
  (Ms Crisp) If I can speak for our companies in South Africa. At the moment we are still, compared to the countries to the north of us, fairly early on in the epidemic so we have more of an HIV epidemic than an AIDS epidemic. Yes, we are seeing increasing absenteeism and increasing incidence of tuberculosis but not to the extent yet that it is impacting on productivity and operations. Our best experience of how it has impacted already and will impact in South Africa is to look at our operations in Zimbabwe. What we are seeing there is, yes, it is having an impact, but it is not putting any of our companies out of business. As Brian mentioned earlier, you might have a situation where you have a pool of employees and the infection level might be as high as 25 per cent but most of that 25 per cent at any one time in fact are well and fit, they are not getting sick. If you think that the average time from infection to becoming ill is eight years, then the 25 per cent will get sick over a eight-year period. So the numbers who are getting sick each year will not exceed 3 per cent, and our figures in Zimbabwe show this, is about 2.5 per cent. That is actually manageable. We have had situations, as I think most companies have over time, where we can lose way in excess of 2½ per cent of the workforce in any one year, or certain groups or skills within the workforce as a result of economic booms or whatever. The impact is not as huge as one would gain the first impression from reading a lot of the literature. Having said that though, there obviously is an impact and certainly it is making it more difficult for our managers to manage their operations and not only to manage their operations but also to provide the support and care and treatment for those people who are becoming sick. I think that is the challenge that we are finding in our operations at the moment. It is to ensure that we remain productive but at the same time to provide whatever care and support we can for the people who are getting sick.

  306. From your Business Council's viewpoint how would you like to respond?
  (Ms Franklin) I think you are better off speaking to Jenny and Christopher because they have got the company experience whereas I can only speak from an overview. I think that Jenny answered the question.
  (Mr Cochrane) Can I add one thing. The World Bank has looked at this very specifically. I do not have the figures absolutely in my head but they are approximately that in any country which has got an incidence of about ten per cent it affects the per capita GDP by about half a per cent and any country which has got over 25 per cent, and a number of countries that we have been talking about do have that, it is affecting GDP growth by about one per cent per annum.

  307. How does that work particularly?
  (Mr Cochrane) Exactly what Jenny is saying. You have ultimately to employ more workers to do the same amount of work and that is how GDP will be worked out.
  (Ms Crisp) Or you can take another approach. One of the things we are doing is not necessarily training a whole lot more people but we are looking at multi-tasking and multi-skilling. We are looking at having at the lowest levels of labour a pool available so that we can draw on them as and when people are sick on a day-to-day basis. We are identifying within each of our companies the key skill categories. I think it is very interesting. We have spent a huge amount of time and energy and history doing succession planning for managers because we assume them to be the key people. One thing this epidemic has taught us is that it is generally people at the lower level, the operators, who are the key people because if we do not have people drilling the rock or shifting muck we do not have a business. In all our companies what we are asking managers to do is identify those key skills and, yes, do extra training at that level. So it is very focused. Our approach to the whole problem is to say that every company in our operation must do an impact assessment in an effort to quantify what the likely impact is going to be on productivity and on benefit schemes. Then each of them must develop appropriate responses and it will obviously vary from one company to another depending on the demographics of that company and its area of operation and so on.

Mr Jones

  308. I was in Botswana last year and I went to two places and we talked about this problem. One was an organisation in the north of the country where they employed 150 people and the manager told us that he knew that by this time next year 20 of them would be dead. I said, "How do you cope with that?" He said, "We recruit a few more people." We went to another place which was the Jwaneng diamond mine. There were lots of people there and the manager had just received the results of the voluntary anonymous saliva tests and he was in a state of shock because it had shown he had got 25 per cent infection rate right across the pay rates and he had no idea how he was going to cope with that. It was the first news he had had. They were an enclosed community and he thought they were perhaps a little bit immune from the problem. Is that the picture, that there are some organisations, like your own, which are ahead of the game and understand there is a problem and a lot of other fairly big and important organisations who just brush it under the carpet, who have not done the tests, who do not know what is going on?
  (Ms Crisp) I think that is absolutely the case and that is part and parcel of this whole denial. The denial does not necessarily apply to the individual, it applies to the organisation as well. I think it is something that is not peculiar to the AIDS problem. I think a lot of companies tend to be reactive rather than proactive. If you have got an impending strike or a take-over or wage negotiation that is going to get priority treatment rather than the AIDS problem which is going to hit you in five years' time. That has certainly been the response of a number of companies.


  309. Is that your experience, Mr Wheeler?
  (Mr Wheeler) A survey has been undertaken by Harvard Business School, some results of which came out in something called the African Competitiveness Report. If I refer back to your original question on prevalence, there is a clear gap between the business community's recognition of the size of the issue and that data that medical research and UNAIDS seem to be putting forward. Most businesses do not yet recognise the severity of the issue or the consequences in due course. I think Jenny is right in this context that it is manageable. Certainly within our own workforce we do believe it is manageable with the right levels of education to prevent infection so we can monitor prevalence. But there is not very much discussion or public awareness. It is relatively isolated and you are talking to a representation of those companies that do participate in gathering the data.

Mr Jones

  310. Can I ask about the training budget. I think you, Ms Crisp, told us that you were changing your training to do multi-tasking and multi-skilling. Presumably that is having a financial impact on the budget. But is one of the perverse effects of the epidemic that your workforce is better trained than it was previously?
  (Ms Crisp) It could well be but I think South Africa is changing for all kinds of reasons and not just related to HIV and AIDS. We have had a whole new dispensation in the country since 1994. We have suddenly become global rather than totally internal and there is this whole international competitiveness that everybody is contending with at the moment. A whole host of things are impacting on us and the way we do business, including HIV and AIDS. We have certainly been multi-skilling for a number of years even before we were concerned about HIV and AIDS. It is an on-going process. It has possibly been accelerated in some companies but it is not the only reason it has been happening.

  311. One of the people we met told us that you start to work out who was going to drop off the perch, as he described it, because they started to become absent from work a day a week, then two days a week. What is the rate of HIV-related illness, absenteeism through illness for themselves, having to care for another member of the family, going off to funerals, and how is that affecting productivity?
  (Ms Crisp) It is impossible for us to ascertain how much absenteeism is HIV-related because we do not know how many employees are HIV-positive. We are certainly seeing an increase in absenteeism and it would be our expectation that that will continue to increase.

  312. Have you changed your policy about absenteeism?
  (Ms Crisp) No, we have not. Within our companies we have always had fairly generous sick leave entitlement and that has not changed at all. We have always had policies relating to the number of days people can take off for funerals and that has not changed. If people now need to go to more funerals then they are entitled to so much compassionate leave each year and if they need additional time they will take annual leave.
  (Dr Brink) What your question does highlight, though, is the need for good management practices. Even in your last question where you suggested that a benefit might be that employees are better trained, that in a way is the way we would like to try and turn the epidemic around to say we can cope with it, we can manage it, and we can do things better and by doing that we will survive this. We need to have those indicators of just how much sick leave is being taken, what is happening with the passage of time. Certainly from a central point of view we are beginning to ask those questions. We are saying to managers this is something you must report on because clearly it is of significance. If you start watching that number your attention will be focused on managing that number and that is really what we are trying to instill throughout all our companies—improve your management and in that way you will cope with the epidemic for the benefit of everybody.

  313. Can I ask about profitability and what effect it is having on your individual companies but also on those countries where there is a high prevalence of HIV/AIDS?
  (Dr Brink) I think with regard to profitability, it is very important that our companies in Southern Africa remain in business and that they remain profitable because just by being there and having profitable companies which people are prepared to invest in, that in itself is a great contribution to the region in terms of eradicating poverty and unemployment. So it is hugely important that we are able to demonstrate that it is worth investing in these companies, that they are able to run successful businesses.

  314. Is there any variation between different types of business? Are some businesses less prevalent than others?
  (Dr Brink) I think that again the demographics of the epidemic would dictate that some businesses are going to have a higher impact due to HIV/AIDS than others. I would say that in all circumstances the challenge there is to manage the epidemic in a way in which it is not going to impact on the profitability of the business, that the business will remain sustainable in the long term. That is absolutely critical and we believe we can do it.


  315. Is that the case with you, Mr Wheeler, too?
  (Mr Wheeler) I think for those organisations that are educating and managing their workforce, similarly we are not expecting profit to go down as a consequence. That is not to say that costs in certain areas will go up in terms of medical and health benefits and so forth and that is absolutely the case. From the macro-economic point of view, as was suggested earlier by James Cochrane, there are going to be impacts on countries and they have not yet been evaluated at a political level.

  316. But the message you would like to give is that this epidemic can be managed, productivity will not suffer because you are going to improve the skills in your workforce, and that there should be no inhibition as a result of HIV/ AIDS to further investment and further opportunities developing? Is that what you are saying?
  (Mr Wheeler) Chairman, I would suggest that for relatively sophisticated organisations who are able to provide the level of education and understanding of the issues, that is possible. I would suggest that there are many local companies who would find that difficult to achieve.

  317. But smaller companies which are perhaps not managing and not indulging in the extra training and extra skills might be affected badly by this, might they?
  (Mr Wheeler) I would expect so.
  (Mr Cochrane) Can I just add one point. I think we must remember that this disease does take a long time to show itself and therefore it may be a manageable situation in various organisations that are on top of it but if you have got a prevalence in a country of 30 per cent, as the data shows, clearly when that comes to fruition to full-blown AIDS, and individuals who are now HIV-positive but healthy then become sick you are then going to get a different situation five to ten years down the line.

  Chairman: It obviously has a big impact on public health and health provision, does it not? We will come on to that in a minute and go into those costs. Nigel?

Mr Jones

  318. Is there a discernable affect on the morale in the workplace, motivation, willingness to work, relationships at work, stress levels, effectiveness, willingness to innovate?
  (Ms Crisp) We certainly expect it to have an impact. All of us who have lived with someone who has got terminal illness or worked with someone who has got a terminal illness know that obviously it does have an affect on your morale. We are certainly expecting to see this in our operations, but again I come back to the point that if you are a member of a particular work team, you are only a small part of that pool of 25 per cent infected who is only going to get sick over a seven or eight year period. It is not going to be situation where everybody is dying around you. It is going to be an individual here and a few months later another individual over there. Again, it is not as bad as it might seem at first sight but, yes, I am sure it is going to have an impact. Again it is something we have to manage and managers have to be aware of it and they have to manage it as it occurs.

  319. What about medical and benefits budgets of companies? Standard Charter told us that their experience indicates the need to establish a limit on the amount of benefit as there is no doubt that the cost burden on business will increase. If benefits remain unchanged what would be the estimated cost of the disease as the AIDS epidemic develops and what changes can be made to the provision of sickness benefit, retirement pensions and life insurance as a result of this epidemic?
  (Dr Brink) I think the AIDS epidemic must have an impact on the cost of medical benefits, but I think we are getting to the stage where we have to clearly define and look at the cost of the medical benefit in relation to the cost of doing nothing about it. We are beginning to think that the cost of doing nothing about it may be a whole lot more expensive than getting on and offering medical benefit and offering properly co-ordinated care to people who are HIV-positive. That is something we would like to be able to demonstrate through carefully controlled research in the future to quantify exactly what is the cost and what is the benefit.

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