Economy awaits cabinet fix

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ZumaHand.jpg Independent Newspapers President Jacob Zuma. Photo: Leon Nicholas.

Johannesburg - The primary task of the new cabinet that President Jacob Zuma is scheduled to announce today is to get the economy growing, implement the National Development Plan (NDP) and spur job creation. The ministries in the economic cluster are critical to getting the government’s plans to improve the lives of South Africans off the ground. What follows are some of the shortcomings and successes of each of the ministries in the last administration:

- Forestry, fisheries, agriculture

Under the stewardship of Tina Joemat-Pettersson, the department suffered from severe mishaps. In March, Public Protector Thuli Madonsela issued a report scathing of the minister and recommended Zuma consider disciplinary action against her. This concerned an R800 million contract to manage the department’s fleet of research and patrol ships. Subsequently, Joemat-Pettersson has said she would sue Madonsela over the report.

In May, Joemat-Pettersson announced that last year’s fishing rights allocation process would be set aside, following an independent legal audit, which found the allocation process was flawed.

- Trade and industry

In April, Trade and Industry Minister Rob Davies launched the sixth three-year iteration of the Industrial Policy Action Plan (Ipap), for 2014/15 and 2016/17. The investment incentives have spurred close to R143 billion in private sector investments, creating about 144 000 jobs.

The plan is aimed at ramping up competition in the production and services sector.

- Economic development

Minister Ebrahim Patel introduced the New Growth Path (NGP), but it seems it still has to get off the ground after its official launch at Tuynhuis in November 2010. Perhaps it was overshadowed by the NDP.

Patel said: “The centrepiece of the NGP is a massive investment in infrastructure and people through skills development, together with smart government and better co-ordination with the private sector and organised labour, so that we can achieve our national goals.”

A fleeting glory for the department was in June, when the Competition Commission reported 15 construction firms agreed to pay penalties totalling R1.46bn for collusive tendering.

- Finance

A rumour surfaced recently that Finance Minister Pravin Gordhan wanted to retire from politics so that he could spend more time with his family. This was followed by reports that investors were looking to Zuma to reappoint him to help bolster confidence and drive economic growth and job creation.

Gordhan ordered government departments and ministries to slash perks for all officials. The measures signal an end to ministers splurging R1m on luxury cars and long stays in five-star hotels. No public funds would be used to buy alcohol, all official credit cards would be revoked immediately, and ministers would be banned from travelling first class.

In the last financial year, the SA Revenue Service (Sars) collected R899.7bn, surpassing its target of R899bn.

- Labour

Labour Minister Mildred Oliphant has had to grapple with the longest strike ever in the history of South Africa.

Two days before the strike on the platinum belt, she said the country could not afford a protracted strike and added that she was meeting with unions and employers to seek a way forward. Unless she has been discreet, she has not made any headway.

At the launch of the annual report of the Employment Commission, Oliphant said the slow pace of transformation showed that remnants of apartheid remained in the workplace. With the new legislation, firms can be fined up to 10 percent of their revenue if they are guilty of flouting the Employment Equity Act.

- Energy

Energy Minister Ben Martins came to this portfolio on November 1, 2010, after swopping with Transport Minister Dipuo Peters. Although he is responsible for energy, he has no say on Eskom, which falls under Public Enterprises.

In April, he said South Africa would start a procurement process for 2 500 megawatts (MW) of additional coal generation electricity.

He also said his department would be procuring 800MW of co-generation power.

- Public enterprises

Minister Malusi Gigaba is in charge of two unruly horses: Eskom and SAA.

In March, South Africa awoke to a state of emergency declared by Eskom, attributed to wet coal. It said it lost three units and had to reduce output at other power stations.

Medupi and Kusile, which are both 4 800MW power stations, have missed deadlines to come online several times.

It was reported in February that money-losing SAA had been subject to eight recovery schemes in the past 13 years, all of which had failed, costing the taxpayer almost R16bn.

Two former chief executives are suing SAA over their dismissals.

- Mineral resources

Minister Susan Shabangu launched a scathing attack against Anglo American Platinum (Amplats) last year for announcing it intended to lay off at least 14 000 miners.

She said the company was undermining her department by taking decisions without proper consultation.

The mining sector stakeholders forum, led by Deputy President Kgalema Motlanthe, has failed to make a meaningful contribution towards ending the platinum strike.

Meanwhile, the Mineral and Petroleum Resources Development Amendment Bill is awaiting Zuma’s signature.

Shabangu said the legislation would streamline the granting of licences and provide a framework for beneficiation. It would also give the government the power to declare minerals as strategic.



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