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The plans are laudable, but their success lies in record-keeping and implementation, writes Thabi Leoka
The ANC manifesto has introduced no new solutions to growing the economy and solving the unemployment problem that South Africa faces.
In 2010, then president Jacob Zuma announced the Job Fund, where projects worth R3 billion were approved for job creation.
In 2013, there were talks of plans to empower the youth. State-owned companies were supposed to provide apprenticeships and learnerships.
There was an appeal to the private sector to absorb 11 000 Further Education and Training graduates who were awaiting placement.
In his 2013 state of the nation address, Zuma announced that the department of rural development and land reform would run the National Rural Youth Services Corps, which apparently enrolled 11 740 young people in various training programmes.
Over the years, there have been numerous policy discussions, academic papers and commentary on how we should solve the unemployment problem we currently face.
Had we implemented some of the suggestions found in chapter 3 of the National Development Plan, the manifesto would be more of an update on the improvements made, the challenges ahead and how the ANC plans on overcoming these challenges.
It is 2019, and 25 years into democracy, the unemployment rate is 27.5% – and if we include discouraged workers, that figure is closer to 40%.
The unemployment rate among South Africans between the ages of 15 and 24 is the highest in the world at 52.4%.
Sadly, where there is little progress made, the same grand plans and ambitions will be regurgitated each year.
I do not want to move forward looking back. President Cyril Ramaphosa has done well in reaching out to the private sector and labour in an effort to bridge the trust deficit that emerged over the past few years.
However, as citizens of this beautiful country, we should hold people in leadership to account.
A political party’s manifesto is a document that informs the voter about what a political party hopes to do and achieve. This document should influence the voter’s choice. So, as a woman, I agree that women, rural people and the youth have been excluded from economic activity.
I support the idea of building an economy “in which all our people have a meaningful stake and from which they can all benefit”.
I fully support the drawing of more women, more rural people and more youth into the economy by expanding access to digital skills training to young people, developing and supporting technological and digital start-ups, and making a more concerted effort to focus on small, medium and micro enterprises, cooperatives and township and village enterprises.
Allocating at least 30% of procurement spend to small businesses and cooperatives is music to my ears because I believe that small businesses are a key driver of economic growth.
Small businesses are both vehicles for entrepreneurship and sources of employment and income.
The labour absorptive capacity of the small business sector is higher than that of others.
Unlike the large companies we have in South Africa, small businesses adapt more rapidly to economic trends, they tend to use local resources, they do not necessarily require highly skilled workers or training, and often workers learn on the job.
For someone like me, who grew up surrounded by thriving black entrepreneurs in Soweto during apartheid South Africa, a manifesto that focuses on the plight of townships is appealing.
The ANC wants to ensure that townships and villages do not remain the dormitories “for most of our people, far from economic opportunities and often without adequate social amenities”.
Read: Sharp rise in number of South Africans leaving the country
I can list a lot of appealing ideas and ways which, if implemented, would bring sustained economic growth.
The problem is, and has always been, implementation.
How does the ANC plan on achieving all the lofty ideas and plans it has in its manifesto? The details are missing.
I would also suggest that a national dashboard is created so that we can track plans and projects and their achievements. What happened to the National Rural Youth Services Corps, which enrolled all those young people in training programmes? Where are they now? And what happened to the Job Fund of 2010? With a dashboard, we would know where they are, and if the programme was not successful, we would be able to see what came in its place.
The one issue that I believe requires further consultation with stakeholders and should not be part of the manifesto, is prescribed assets on financial institutions.
Prescribed assets would essentially force fund managers to invest in government-approved instruments. This would undermine an asset manager’s investment philosophy, which informs their reasons for investing in a particular asset. It would also undermine and limit their ability to assess risk.
Again, this is not a new idea. In the 1980s, the national government legislated prescribed assets, where fund managers had to invest 53% of retirement funds in state-owned enterprises (SOEs) and government bonds. Offshore investments were not allowed.
I understand the spirit of suggesting prescribed assets. It is a way of growing the economy through injecting funds into ailing SOEs, but this may also divert funds away from corporates to entities that are yet to contribute towards growth.
Lastly, the manifesto states: “The ANC believes that the SA Reserve Bank must pursue a flexible monetary policy regime, aligned with the objectives of the second phase of transition. Without sacrificing price stability, monetary policy must take into account other objectives such as employment creation and economic growth.”
I understand the Reserve Bank governor’s frustration when it comes to this because he has stated ad nauseum that you need price stability in order to achieve sustainable growth. A lot of academic work has been done on the relationship between price stability and employment. I therefore argue that there is no need to add employment as an objective, when maintaining low and stable inflation is central to achieving employment and high rates of growth.
In a country like Malaysia, every prime minister has left a legacy that the country celebrates. The first prime minister was hailed as the Father of the Nation, the second as the Father of Development, the third as the Father of Unity, the fourth as the father of modernisation and the fifth as the Father of human capital development.
If leaving an impressive legacy is key to Ramaphosa, all he has to do is implement policies and prioritise the country before the party.
Leoka is an economist affiliated to two organisations. She was named Economist of the Year in 2017
