Miners representatives threatened a walk out

The Chamber of Mines (COM), which is negotiating on behalf of gold mining firms, said it has raised its pay offer to 8.5% from 7%, Reuters news agency reported.

Coal mining employers have also upped their offer to 9% from 8%, while one major producer, Xstrata, has offered 10%.

The National Union of Mineworkers, which is asking for a 20% pay rise for workers, has welcomed the improved offer and agreed to continue the talks about wages for 300,000 miners.

'Very hopeful'

The improved pay offer came after four days of discussions organised by the national mediator, the Commission for Conciliation Mediation & Arbitration (CCMA).

"Employers believe that the proposed increases represent very good wage offers," said the Chamber of Mines.

"This compares with the current inflation rate of 7.8%."

The NUM said it was "very hopeful" at the progress it had achieved during the talks. It agreed to two more days of negotiations starting on 15 July.

However, the NUM said questions remained to be settled over wages, pensions, job grading and holidays.

The employers' offer is a two-year deal, with a guarantee to match inflation in the second year. Coal miners would get a minimum of 7% in the second year, and gold miners 6%.

It includes a pledge to make sure all surface workers have a minimum wage of 2,000 rand within two years, the Business Day newspaper reported.

This would bring their minimum pay to the same level as underground workers got in the 2001 pay settlement.