The State of the Nation address should have been earth-shattering enough to communicate the seriousness of government’s “radical economic transformation” programme, says Khaya Buthelezi.
Johannesburg - The narrative that the ANC is scared to govern is gaining ground among many observers. This was aptly illustrated in President Jacob Zuma’s seventh State of the Nation address which left many, including myself, a bit deflated and thinking the whole hype about a radical economic-transformation shift in favour of the black majority was just election rhetoric and nothing more.
After Zuma’s speech, he took a stroll with First Lady MaKhumalo to the lawns of the Union Buildings where, in Zulu, he spoke emphatically to more than 20 000 people about the “radical steps” his government would take to address the socio-economic challenges facing millions of people who voted the ANC into power for a fifth successive term.
The first State of the Nation address of this five-year term should have given us a glimpse into “radical economic transformation”, but it sounded more like a lullaby story I have heard before and couldn’t help dozing off occasionally during the address.
The tone and content of the speech left much to be desired – it was an anticlimax.
A part of me wants to cut the president and ANC some slack and say “logic and pragmatism” rule the roost in ANC discussions and decisions.
That, in the final analysis, the party will opt for the best workable solution, taking into account local conditions and the geo-political environment.
My friends in the ANC would say pragmatism is in the DNA of the party and that is what has stood it in good stead over the past 102 years and ensured its survival through the Cold War era to the present. In the main, as others would argue, this is what informed the president’s seventh State of the Nation address .
I beg to differ. This is what Zuma should have said: mining companies that fail to meet the targets as set out in the Mining Charter by the 2014 cut-off date in addressing the appalling socio-economic conditions under which their employees live will be stripped of their mining licences.
In future, only mining companies committed to paying a decent wage to their employees and prepared to reinvest their profits in the development of the communities within which they operate will be considered in the allocation of future mining licences.
In addition, mining licences will be allocated to companies that promote community and employee share-owning schemes in the fulfilment of broad-based black economic empowerment (BBBEE) objectives.
As one of the measures to jump-start the economy, create decent jobs and meet a growth target of 8 percent by 2019, new legislation will compel all companies, listed and unlisted, to reinvest 10 percent of their after-tax profits in the economy, before they can venture into foreign markets.
To allow the SMME sector to flourish, all SMME employees with a turnover of less than R5 million will be exempt from paying tax and adhering to labour laws applicable to big companies.
This on condition that they reinvest 5 percent of their profits in the expansion of their businesses and job-creation initiatives.
To this end, a committee of experts will be set up to investigate the modalities of creating a two-tier labour and tax system for the formal and informal sectors of the economy.
Furthermore, to grow SMMEs, all commercial banks must increase their lending to the sector to 30 percent of all their lending in the next five years.
The social partners’ dialogue, under the leadership of Deputy President Cyril Ramaphosa, will be urged to emerge from the meeting with social contracts between labour and business that commit both parties to zero strikes for the next five years.
This means business will have to commit itself to above-inflation wage increases for the next five years and also drastically cut down on excessive pay for company executives.
By the same token, there will be a moratorium on salary increases for public representatives, including members of the cabinet, premiers and MECs for the next five years.
In terms of land restitution, land will be returned to the claimants with minimum compensation to the former landowners to ensure that black people occupy more than 60 percent of commercial agricultural land by 2030. Farmers unwilling to co-operate will have their farms confiscated by the state and given to compliant farmers.
To quicken the pace in the implementation of BBBEE and employment equity, all JSE-listed companies are urged to increase their black shareholding to 50 percent and black representation on all levels of management to 60 percent in the next five years. Failure to do so will result in companies being penalised heavily and stripped of their licences.
To improve access to financial products, including affordable decent housing finance for the growing black middle class, Postbank will be turned into a state-owned bank with the capacity to give short-term loans and home loans.
Cattle and communal land can be used as collateral.
The above would have been earth-shattering enough to communicate, in tone and content, the seriousness of the fifth democratic government in implementing its radical economic transformation programme.
* Khaya Buthelezi is a reputation management specialist based in Johannesburg.
** The views expressed here are not necessarily those of Independent Newspapers.