Beacon of hope as SA stands at a crossroads

17 October 2011 - By Heather Dugmore

As the winds of unemployment, corruption and mismanagement rattle the good ship South Africa, a beacon of hope is visible in the form of the National Planning Commission (NPC). 

Heather Dugmore speaks to Wits alumnus Kuben Naidoo (BSc 1993; PDM 1995), who heads up the NPC Secretariat. 

Once upon a time in South Africa the democratic promise of a thriving economy with employment and a good quality of life for all South Africans was slipping away. 

Then along came the National Planning Commission (NPC), appointed by President Jacob Zuma, headed by former Finance Minister Trevor Manuel, and assisted by a team of 25 experts from every sector of South African life. The team includes specialists in water, housing, education and the environment, labour market economists, agricultural economists, trade unionists and business people. 

At the inaugural meeting of the NPC on 11 May 2010, President Zuma stated: ¡°The mandate of the commission is to take a broad, cross-cutting, independent and critical view of South Africa, to help define the South Africa we seek to achieve in 20

years time and to map out a path to achieve those objectives. The commission is expected to put forward solid research, sound evidence and clear recommendations for government. 

The NPC released its diagnostic report in June this year for comment. In November, its final report and development plan, containing the 2030 vision for South Africa, will be presented to Cabinet. 

As head of the NPC Secretariat, Kuben Naidoo is confident that government will act on its suggestions. He is an optimistic man because several of the suggestions go against current political tides. 

¡°I believe there is sufficient political goodwill to take the issues we are facing forward in a constructive manner. I am very positive about South Africa and an amazing amount has been achieved since 1994,¡± says Naidoo, referring to the diagnostic report, which lists some of South Africa¡¯s achievements during this period as follows:

• South Africa has the 27th biggest economy in the world, accounting for almost 25% of the GDP of the entire African continent (World Bank);
• The JSE is the 14th largest stock exchange in the world, with a total market capitalisation of some R2.3-trillion (JSE);
• More than 12 000 ¡°Black Diamond¡± families (South Africa¡¯s new black middle class) are moving from the townships into the suburbs of South Africa¡¯s metro areas every month (UCT Unilever Institute);
• The black middle class grew by 30% in 2005, adding another 421 000 black adults to SA¡¯s middle-income layer and ramping up the black population¡¯s share of SA¡¯s total middle class to almost a third. Between 2001 and 2004, there were 300 000 new black entrants to the middle class (Financial Mail);
• South Africa generates two-thirds of Africa¡¯s electricity (Eskom);
• Durban has the largest port in Africa and the 9th largest in the world;
• 96% of children below the age of 15 are in school;
• The proportion of black people in higher education is up from 27% in 1986 to 78% today;
• Over 700 clinics have been built;
• 2.6-million subsidised houses have been built, providing shelter for more than 10-million people.

Starting on this positive note, Naidoo then lists some of the key issues facing South Africa, on which the NPC has been asked to advise. These include: unemployment; the sub-standard quality of education for most black and coloured learners; food, water and energy security; the ailing public health system; the corruption that undermines state legitimacy and service delivery; spatial challenges that continue to marginalise the poor; and skills shortages. 

What is remarkable is that Naidoo is not daunted. 

Starting with skills shortages, he says: ¡°It is clear that if we want to make progress we have to start using the skills and resources of all South Africans, and the NPC has made a big issue of the need for non-racialism. 

¡°Policies like black economic empowerment, employment equity and land reform are morally correct but they only work effectively in an environment where the economy is performing well, where the cake is growing, and where you have an education system functioning well to produce skills. In the absence of these, such policies become a win-lose trade-off. Part of what we are suggesting is that South Africa first fixes the context.¡± 

There has been a sharp rise in unemployment, he notes. ¡°Out of every 100 adults between the ages of 18 and 60 in South Africa, only 41 are working, and that includes the informal sector.¡± 

He compares this figure to most other developing countries where over 60 people in 100 are employed in this age group, and to developed countries where over 70 are employed. 

¡°Our entire economy needs to use more labour but this is not happening,¡± says Naidoo. Some of the reasons are to do with the legacy of apartheid and poor education, some with spatial inequality and the fact that the poor generally live far from places of work; others are stifling labour laws and the structure of our economy, which is not competitive enough. 

¡°In South Africa we have very large businesses that employ large numbers of people but we don¡¯t nurture small and medium size businesses, which are essential for employment. Other countries have millions of smaller businesses but we have too many laws and regulations, which make it difficult for smaller businesses to survive and thrive. On top of this we have collective bargaining which sets relatively high minimum wages. If we want to encourage smaller businesses we need to look at exempting them to some extent.¡± 

Stifling labour laws, he adds, are leading to extensive job loss instead of job creation in critical sectors such as agriculture, which, together with mining, used to employ more people than any other. 

He discusses the example of the Draft Land Tenure Security Bill which would give every farm worker who has worked and lived on the farm continuously for six months or longer the right to permanently live on the farm, with their extended family. Nobody is going to want to hire labour if this gets approved. 

On a more positive employment note, Naidoo says the transition to a low carbon or ¡°green¡± economy will help to create a new generation of labour intensive jobs, which is what the country needs. ¡°We need to move far faster on this,¡± says Naidoo. ¡°Think, for example, of the employment that can be created around the installation and maintenance of solar water heaters in 2-million South African households.¡± 

He explains that ¡°government inefficiency and policy uncertainty¡± is standing in the way of key green goals, such as the tariff scheme for renewable energy, which was supposed to be on the national grid by mid-2011. Because of government¡¯s stalling on this, renewable energy producers are considering relocating to other African countries. This poses a massive threat to job opportunities in South Africa. 

One of the reasons for this lack of progress, Naidoo explains, is that our government operates in silos where the Department of Energy has one approach, the Department of Trade and Industry has another approach and the Department of the Environment has another. 

¡°Considering that about 40% of our country¡¯s energy needs to come from renewables by 2030, urgent national dialogue and decision-making is required,¡± he says. 

COP17, the United Nations meeting on climate change, is taking place in Durban in November this year, yet we are still engaging in too much talk and political gesturing with far too little action. 

A strong economy requires strong performers, states Naidoo. In many sectors, however, performance is not rewarded in South Africa, and this prevents us from achieving competitiveness and excellence. 

¡°We see this very clearly in government-paid positions, such as teachers, police officers and prosecutors, where the principle of ¡®equal work for equal pay¡¯ breeds mediocrity because excellence cannot be rewarded.¡± 

Highly motivated government school teachers, for example, who go out of their way to encourage learning, do not get paid any more than teachers with little interest in their profession. 

¡°On top of this, a government school teacher with 15 years¡¯ experience earns just a little more than a teacher with two years¡¯ experience,¡± he adds. The same applies to other government sectors. ¡°This is how our courts have landed up with so few senior prosecutors.¡± 

The solution, he says, is to pay inexperienced people less and to financially reward excellence and experience. 

Continuing the discussion about teachers and education, Naidoo says: ¡°In the report we state that we have failed to improve the quality of education for poor people, notably black and coloured children.¡± 

While the legacy of apartheid education still haunts us, the post-1994 democracy has made some poor policy choices. ¡°Outcomes-based education has good intentions but we do not have the skills, capacity or resources to implement it,¡± he says. ¡°We have also underinvested in teacher training and the work ethic in education is low. We have to increase the accountability of teachers to the communities in which they serve, we have to invest in training more teachers and we have to encourage people to become teachers by offering full bursaries and scholarships. 

¡°We additionally have to invest in principals because they make all the difference as to whether a school functions well or not. The Department of Education will soon be conducting competency tests with all principals and deputy principals in South Africa¡¯s 27 000 government schools.¡± 

On the issue of food security, Naidoo says the NPC recognises that land reform cannot be conducted at the expense of food security. He says the state needs to encourage all existing commercial farmers and make them feel secure. At the same time the state needs to conduct the process of land reform far more professionally and give emerging farmers proper training and support. 

In this era of climate change, food and water resources need to be protected at all costs, and the two are inseparable. ¡°É³°ÍÌåÓý¹ÙÍø_2024Å·ÖÞ±­²©²Êapp@ 60% of South Africa¡¯s water is currently used in food production processes,¡± Naidoo explains. ¡°In a water-stressed country we need to do everything we can to conserve our water, including investigating how to protect our water catchments and river systems, and how to produce more food with less water.¡± 

Crime and corruption is another core issue the NPC is addressing. 

¡°The reason for the high level of crime and corruption is weak accountability and poor systems of control in government on the one hand, and the breakdown of ethics and values in the private sector and in society in general on the other. To fix this, you have to fix both. We have reached the stage where too many people think it is okay to break the law and pursue illegal, quick-fix avenues to get rich.¡± 

Naidoo says South Africa needs transparent systems of accountability, strong crime and corruption deterrents, robust crime and corruption fighting institutions and social education. 

¡°We need people across the board to reassess the cost-benefit analysis of crime and corruption. At present both are seen as worth it, and we need to change this. To achieve this we need to start making strong examples of people who have committed crimes and/or are found to be corrupt. Others will soon get the message.¡±

Recommended strategies for all the issues addressed by the NPC will be presented in its November report. It promises to be one of the most important documents ever to be produced in South Africa as it plots the course that South Africa will hopefully be taking for the next 20 years. 

For the diagnostic report and more information about the NPC see www.npconline.co.za 

To email your comments on the report: comments@npconline.co.za