Sugar Sector

An Abject ‘Sugar Mentality’ Still Ruling The Roost

There was a strong case to salvage those who are the weakest components of this construct – workers and small planters. The institutions set up for this purpose have failed to live up to expectations

Discussions have been started between the Joint Negotiating Panel of trade unions (JNP) and the Mauritius Sugar Producers Association (MSPA). The objective is to reach an agreement about wages and remunerations and work conditions in the sugar industry for the coming period.

According to current legislation, once an agreement is reached between the two sides, it will be binding upon both for the next two years. In addition to the above considerations, there are issues such as the extent to which the sugar companies which MSPA represents can have recourse to contractual and casual labour for undertaking the work that was done in the past by a permanent much larger workforce than the current staff strength of only some 5000 on the rolls of the sugar industry.

As it is well known, the Employment Relations Act and the Employment Rights Act, which were enacted in 2008, had the effect of simplifying and facilitating the recruitment of contract labour by employers, thus dispensing with the need for the large sugar companies to host an important workforce and weakening, by the same token, the bargaining power of workers.

Moreover, employers were empowered to enter into negotiations with sub-groups of workers, which negotiations when concluded through an agreement would become binding on all workers. There has come about a growing feeling among trade unions that the impact of the legislations of 2008 has been to weaken trade union power generally. Thus, the discussions between the JNP and the MSPA are being conducted in the shadow of legislation biased against worker interests.

Another disquieting element has crept in to colour the on-going negotiations. It concerns the stated inability of the MSPA to make the decisions arrived at binding upon all the membership constituting the MSPA, i.e., all the large sugar producers. In other words, those members of the MSPA which decide that they will not be bound by those decisions taken as a result of on-going negotiations will be free to do so. This is what the MSPA has stated as being a possible risk facing the current negotiations.

In other words, unions have been indirectly warned not to drive the bargain too hard. The risk is that some MSPA member(s), which feels like it can disown the agreement reached if, for instance, it considers that it does not have the economic means to meet its terms, can opt out. This conveys the message to the JNP that they run the risk of not ending up with a collective agreement duly supported by all MSPA members. Some may simply repudiate the agreement and there is nothing the MSPA could do to require its members to comply.

It was even contemplated at one time in the recent past that, unlike the practice in past years, the MSPA will not be mandated to discuss with the unions on wage bargaining and conditions of work. There was a change of mind however and the MSPA got the signal finally from the large sugar companies it has customarily represented in these forums to carry on discussions with the unions. With the possibility that MSPA members which choose to opt out of the agreement could do so. It is clear as to where the weight of the 2008 legislation has shifted the balance of power. The MSPA can collectively own or disown at its own choice an agreement negotiated on behalf of its members, putting forth the argument of economic viability of the proposals.

The attitude of the MSPA and its members shows how cunningly the game is played each time to draw maximum one-sided gains by the large sugar estates. It will be recalled that when it was a question of negotiating quotas and prices with the EU in the past, the MSPA acted as one collective group with the strength of its full membership behind it. When the sugar industry wanted to go for centralisation, the MSPA made a collective representation to the government to be allowed to proceed in this direction. The same holds true for the Voluntary Retirement Scheme the industry was looking for in the wake of modernisation and centralisation of its operations. Whenever tax matters concerning the sugar industry have come up, the MSPA has made collective representations to the government to get taxes revised down to its collective advantage.

When a decision had to be taken by a previous Minister of Finance to streamline the public institutions in charge of conducting responsibilities pertaining to the sugar industry, the MSPA was again in the front line as the single spokesperson for large sugar companies to get the cess being charged eliminated altogether if possible. When it came to securing EU grants under the Multilateral Annual Adaptation Strategy in the wake of downward revision of the sugar price over a period of three years, the government stepped in to become the privileged interlocutor of the EU on behalf of the sugar industry of Mauritius instead of leaving it to individual stakeholders to conduct private negotiations vis-à-vis the EU.

The present industrial discussions between the JNP and the MSPA are however being built up on as tenuous grounds as possible so that MSPA members stand free to repudiate whatever agreement is finally reached, at their own discretion. This situation reflects the double standards customarily adopted by the large sugar companies, depending on how best they can extract the greatest advantages to themselves. It is part of a long-standing mindset that has kept up tense relations because you are not certain on which chord your interlocutor will choose to play up finally.

In the context of the future elimination of sugar quotas to the EU, there has emerged a tendency for the big corporate sugar sector to play it alone. Numbers of small planters have found themselves on the sidelines of development taking place at the big corporate level, even though they have shared the ups and downs of the sugar activity with the corporates over centuries. The big ones will fend for themselves, profit by themselves alone, setting up if necessary their presence in the countries where the markets for sugar are plentiful.

The fragmented small planter community can have no such common powerful economic thrust to survive against local adversity. It will be left to its own fate, ending up perhaps selling its hard acquired land property to the bigger corporate sector for the latter to either make real estate trading gains thereon eventually or to consolidate its land holdings even further.

It is rumoured that the Mauritius Sugar Syndicate, which was set up as the collective marketing agency for all the sugar produced by Mauritius might be dismantled in the light of international market developments, such as the EU becoming out of bounds for our smaller producers as market liberalisation proceeds apace over there. Small producers will really have neither independent recourse of their own nor the collective strength of a common marketing agency of the country as a whole. It is not difficult to see where this story will possibly end in the eventuality of the Mauritius Sugar Syndicate no longer being there.

For quite some time, the scales have been tipped too much to one side. The large companies operating under the wings of the MSPA have used each occasion to extract as much advantage to themselves as possible. Now, they’ve reached a stage where they can let go of the MSPA if it no longer serves their interest. The void thereby created will leave a few gainers only from the centuries old sugar activity but numerous losers as well who will not even know a way out of their increasing difficulties.

We need not have stayed put in a production structure that was clamouring to evolve in the light of losing market preferences continuously; but there was a strong case to salvage those who are the weakest components of this construct – workers and small planters. The institutions set up for this purpose have failed to live up to expectations. It could still be done however if the authorities sit down in earnest on the issues that have cropped up and get something as good as or even better than what the big corporate sector has been able to squeeze out for itself on each opportunity.


* Published in print edition on 2 August  2013

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