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ANC policy indaba must create a platform for honest debate

More than a hundred people queued for social relief grants at a Post Office in Durban in March. Social Policy Initiative research demonstrates that a universal Basic Income Grant of R1 335 has the potential to generate annual economic growth of 4.5% and about 3.7 million jobs, says the writer. Picture: Bongani Mbatha/African News Agency (ANA) Archives

More than a hundred people queued for social relief grants at a Post Office in Durban in March. Social Policy Initiative research demonstrates that a universal Basic Income Grant of R1 335 has the potential to generate annual economic growth of 4.5% and about 3.7 million jobs, says the writer. Picture: Bongani Mbatha/African News Agency (ANA) Archives

Published Jun 5, 2022

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By Isobel Frye

With the new unity growing among opposition parliamentary parties in South Africa, the months running up to the 2024 national and provincial elections provide a fertile opportunity for some of the most intense and truly transformative debates and visioning for our democratic project. We stand at a crossroads.

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The process forward can either be riddled with chaos, divisive and violent self-serving horse trading among political elites, or we can very deliberately use this space to examine what we have all created since 1994, honestly agreeing on what needs to be fixed, and commit to clear targets of change and time-bound, inclusive processes to achieve these targets.

The recently released ANC Policy Discussion Documents have opened up the season for the development of election manifestos. It remains for the opposition to either engage on this terrain or attempt to disrupt the ANC narrative.

A wise electorate would do well to be exacting of the parties that in months to come will be vying for votes, demanding that informed debate replace violence and intimidation as the modality of engagement. The ANC Policy Discussion Documents are not the ANC’s 2024 election manifesto, but they do signal and pre-determine to some extent the various options that can emerge from the intensive internal debates to be held in the coming months.

That this internal debate may be divisive is acknowledged by the selection of Immanuel Wallerstein’s quote at the end of Chapter 1 of the document. According to the quote, we are living in “transition times” that will be divisive, being a “fierce struggle for the future”. Over half of all South Africans live in poverty.

Life is a fierce struggle for daily survival. Unemployment is one of the key causes of the extreme levels of poverty that stunt millions of South Africans, although wage inequality is a greater driver of income inequality than unemployment.

That these dual causalities of impoverishment and inequality have continued unabated suggest a clear class bias in the selection of macro-economic policies and priorities.

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Quarter one for 2022 unemployment statistics released this week by Statistics South Africa reflect a momentary pause in the national jobs massacre with a 0.7% quarterly drop in the unemployment rate to 45.5%, a truer indicator of the unemployment trajectory is the year-on-year indicator that shows a 9% increase in unemployment from quarter one of 2021.

Of the 40 million working-aged people in South Africa, 15 million people are employed, 12.4 million are unemployed, and 12.6 million are not economically active, including just under 4 million unemployed “discouraged work seekers”, people who have given up looking for work.

Definitions and measures are crucial in correctly understanding the size of the problem, in turn allowing for the choice of the most effective corrective. Stats SA has defined the narrow definition of unemployment – which excludes discouraged work seekers – as the official unemployment rate.

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Previously, both the broad and narrow definitions carried equal status, but now the narrow definition carries the branding of approval. This is important for two reasons. The first is obviously that any selection of remedial policies that leaves out 4 million people will be suspect, but more importantly, it indicates the level of political resolve to solve the crisis. Why would we attempt to define the crisis away rather than deal with it head on?

The ILO global unemployment rate for 2022 is predicted to be 6%. In South Africa, 45.5% of working age people are unemployed. We need to call this for the crisis that it is, requiring immediate humanitarian and structural intervention.

Turning to the ANC policy documents, we would hope to see concrete proposals about what to do about jobs and incomes for the 12.4million unemployed people. But the document is riddled with conflicting measures of the extent of the crisis. The unemployment rate is variously described as 29%, 34%, 35.5% and 40%. And the solutions to these different understandings of the crisis are as unclear.

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What we need is a concrete timebound plan that addresses actual head counts – saying over the next three years, we will absorb 2 million youth through the Youth Wage Subsidy, 2 million to Community Works Programme and 2 million jobs through a potential Expanded Public Works Infrastructure programme, 3 million people to Green Transition Jobs and 3.4 million people will be redirected to further tertiary skilling and education.

And from the costing of these plans, we can see if enough funds are allocated for these interventions. The lack of detail on jobs heightens the attractiveness of social security as a means of addressing needs and stimulating economic activity.

The Discussion Documents showcases the clear success of the rapid roll-out of the R350 Social Relief of Distress Grant, pointing to an attractive, concrete solution to people’s poverty – the much debated Basic Income Grant. Question 6.3 in the ANC Discussion Documents, in fact, asks whether the basic income grant can be a solution to address high levels of unemployment and poverty.

Good policy depends on clear detail. Social Policy Initiative research demonstrates that a universal Basic Income Grant of R1 335 has the potential to generate annual economic growth of 4.5% and about 3.7 million jobs, meeting basic needs, and stabilising socio-political unrest.

Wallerstein said: “The employment rates are in very bad shape. We vastly underestimate the unemployment.” We look forward to engaging in honest debate in coming months.

* Frye is the Executive Director of the Social Policy Initiative

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