* Unions demand more action to fight poverty

* Zuma cabinet in focus after ANC election win

* Manuel could move to powerful new body - media

(Recasts with union call)

By Matthew Tostevin

JOHANNESBURG, April 26 (Reuters) - South Africa’s powerful trade unions demanded more action to fight poverty on Sunday, putting pressure on president-to-be Jacob Zuma after the big election victory of his African National Congress.

While Zuma has promised no radical change to policies favoured by business, markets are concerned he could bend to pressure from leftist and unionist allies at a time Africa’s biggest economy faces its first recession in 17 years.

Zuma’s future cabinet will also be closely watched. Media tipped Finance Minister Trevor Manuel, respected by markets for keeping spending in check and promoting financial stability, to head a powerful new government oversight body.

The Congress of South African Trade Unions, allied to the ANC, said that after the ruling party’s 65.9 percent election victory, it was time to do more to address inequality.

“Our priority now is to make sure that the ANC’s commitments in its progressive elections manifesto are driven forward and turned into a programme of action,” said a COSATU statement ahead of the public holiday on Monday to mark the 1994 election that brought an end to white minority rule.

“We must take vigorous action to protect workers from the impact of the global economic crisis, create new, decent jobs, transform the lives of the poor majority of South Africans and ensure that we all share in the fruits of our labour.”

Zuma, 67, is close to the unions, who were instrumental in helping him win an internal power struggle against former President Thabo Mbeki and ensuring his election despite graft charges that were dropped this month on a technicality.

But he has also assured investors they have nothing to fear from putting money in South Africa and pledged on Saturday to work with unions and business to ensure stability. The global crisis allows even less room for manoeuvre.

SPOTLIGHT ON MANUEL

The fate of finance minister Manuel is being closely watched as a sign of policy direction under Zuma.

The Sunday Times newspaper said he was likely to head a new national planning commission which would monitor government performance. It said Manuel’s staff recently held a farewell function for him.

The Sunday Independent said Zuma was likely to keep Manuel in the cabinet to reassure markets, but also said he could be given the powerful Central Planning Commission portfolio.

“Some in the ANC would like his superpowers to be retained in the cabinet,” the paper said.

The rand ZAR=D3 fell more than 2.5 percent last year when markets thought Manuel was leaving the cabinet. Expectations he will stay on have also helped strengthen the rand recently.

ANC spokesman Brian Sokutu said any discussions on posts would still only be at the informal level and the cabinet would be made clear when Zuma takes office on May 9. An ANC transition team is in place to ensure a smooth handover.

“We don’t want to entertain speculation about what individual will take what post,” he said.

The Sunday Times said possible new finance ministers could be businessman Cyril Ramaphosa and current deputy Nhlanhla Nene.

Because of the questions about how long Manuel will stay in his current role, close attention is also being paid to whoever might take the deputy finance job.

Names mentioned include Pravin Gordhan, who heads the tax authority and is credited with significantly improving revenue collection. ANC Treasurer-General Mathews Phosa, a former lawyer and Zuma ally, is also seen as a possibility. (Editing by Dominic Evans)