Maravi

(STICKY) Mining companies and social responsibility

Mining companies and social responsibility
By The Post
Sun 15 Apr. 2012, 13:30 CAT

IN life, it is very important to be clear about things; to harbour no illusions. Richard Musukwa, our Deputy Minister of Mines, says investors in the mining sector must help government deliver its promises on infrastructure development.Richard says it is unacceptable that various mining townships on the Copperbelt had dilapidated road infrastructure and recreation facilities when the country had continued to attract huge investments in the mining sector.

And according to Richard, the government expects transnational mining companies to demonstrate true corporate citizenship by supplementing the government's efforts of delivering development to the people. Richard further reveals that the government is not happy that roads in mining townships are in a deplorable state while mining companies are making huge profits from copper.

He says the massive investment in the mining sector must translate into tangible economic and social benefit to the country and the people who live in mining towns. And that the government is currently working on deliberate policies that would make mining companies more responsive to the people and the country's needs.

He warns that the government will not allow a situation where many people will continue to live in poverty and poor conditions when the country is rich in mineral resources. And Richard goes on to thank, on behalf of the government, Konkola Copper Mines for setting aside US$5 million for the rehabilitation of township roads in Chingola and Chililabombwe.

These are nice things to say. Richard is a nice guy. But the mining transnational corporations are not here to be nice. They are here to make money, make super profits as far as possible. That's what they are here for. The things Richard is talking about belong to an era that is gone, an era whose hour is gone.

When mining started in this territory, the government was under a corporate entity - the British South Africa Company. The company and the government were one. The responsibilities of the company and the government were not divisible.

They provided almost everything that was needed for them to carry out their mining operations. The mining townships Richard is talking about were also theirs. And whatever roads were there were predominantly used by themselves. And when these mines were nationalised, ZCCM carried on that tradition and improved on it.

The new mining owners who came after the privatisation of ZCCM made it very clear from the very beginning that they were not interested in taking over these responsibilities and did not buy the mining townships. They were not interested in providing the social services that used to be provided by the previous mining entities. They were simply here for mining and making a profit from mining.

[Well if Zambia would ever have a government that was not corrupt, they would have said - either you take over the previous 'social responsibility', or you pay every cent of taxes that you owe. - MrK]

To expect them to now act otherwise is a fleeting illusion. It is the duty of the government to provide and maintain the necessary infrastructure and social services required by the mining townships. And the government is not helpless in this endeavour. It has powers to adequately tax these transnational mining corporations and use the money to develop the country and provide the necessary social services to all our people.

Going to ask mining companies who are refusing to pay more taxes, who want to pay less taxes, to provide money for the development and maintenance of infrastructure in mining townships may be hoping for too much. Today, the government is thanking KCM for setting aside US$5million for the rehabilitation of township roads in Chingola and Chililabombwe.

Why should they thank them? We are not asking this question as a sign of lack of gratitude on our part. We are asking this question because we know very well that the US$5 million they are setting aside is nothing compared to the taxes that could have been collected by the government if adequate and reasonable taxes were levied.

Konkola Copper Mines are laughing when offering this money because it means nothing to them compared to the taxes they would have paid if proper taxes were levied. The government is actually thanking Konkola Copper Mines for giving them less change, for shortchanging them.

There is no need for the government to go begging for money from these companies that could have been theirs if proper taxes were levied. In fact, this argument can be extended further to say that even the aid we go and beg for from the countries where these companies come from is our own money.

It is the tax that we should have collected here which ends up being collected by the governments of countries where these companies come from.

[Or not at all. Remember that these corporations have headquarters in tax shelters - The Cayman Islands, The Bahamas, Jersey, Switzerland. In fact the donor aid that certain governments pay are the taxes collected from ordinary working and middle class citizens and ordinary companies. They are paying the taxes that transnational corporations are not paying. Tax evasion is an international criminal scam. - MrK]

If proper taxes were levied, there is no way Konkola Copper Mines would part with US$5 million to fix roads they don't own. They are not fools. They are very prudent in their expenditure - they don't incur unnecessary costs just as much as they don't pay taxes they can avoid.

We understand Richard's thinking. It is the thinking of every decent person that a business enterprise must be a community of solidarity and that businesses should be characterised by their capacity to serve the common good of society. To Richard and others who see things that way, the motive of business should be not only to make profit but even more to contribute to the common good of society. But this is not the way these transnational mining corporations look at things.

They are not here for solidarity; they are here to maximise profits and get away with as much money as possible. And this is why when they make even a small donation to any cause, everyone has to know about it; all the television stations and the press will be there to cover that small donation. This is what guides their donations - positive publicity to fool some people while they get away with very low taxes.

We are not interested in mining companies running our townships. We want them to pay reasonable taxes so that together with our government, we can decide how to best use that money to develop our country and improve the living conditions of our people.

We can't be begging for money that is ours. We are not interested in donations from mining companies; what we are interested in is fair and reasonable taxes and just wages for our people and respect for the environment.

If these companies were paying reasonable taxes, they would not be interested in any way to take up responsibilities they had from the very inception refused.

Labels: KCM, MINING, SOCIAL CONTRACT, WINDFALL TAX

posted by MrK @ 1:29 AM