South African President Cyril Ramaphosa.
Picture: Thobile Mathonsi/African News Agency/ ANA
South African President Cyril Ramaphosa. Picture: Thobile Mathonsi/African News Agency/ ANA

#StimulusPackage leaves political parties, labour unions divided

By Zintle Mahlati Time of article published Sep 21, 2018

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Johannesburg - President Cyril Ramaphosa’s wide-ranging stimulus package has received mixed reactions from labour unions and opposition political parties. 

Ramaphosa announced the package on Friday and emphasised that it is meant to stimulate the economy into recovery. 

The deal has five aspects which deal with reviving the economy, increasing investor confidence, prevent further job losses, address issues faced by vulnerable people and measures to do deal municipalities. 

The package includes pumping money into infrastructure spending and will also see about R50 billion in budgeted spending being reprioritised. 

This package has pleased some but has brought a number of questions from labour and political parties. 

The DA said the package would not go enough in dealing with challenges faced by the economy and is likely to have a modest effect on the economy. 

 “In the end, the stimulus and recovery plan is likely to have a modest effect on economic growth and job creation, and it is likely to be compromised by reckless economic policy proposals being considered,” said the DA’s David Maynier. 

“The stimulus and recovery plan is aimed at speeding up the implementation of existing economic policies, rather than introducing new economic policies, such as exempting small businesses employing fewer than 250 employees from complying with restrictive labour legislation, other than the basic conditions of employment, in South Africa,” he said. 

Ramaphosa has also instructed health minister Aaron Mostoaledi to fill 2 200 vacant posts in the health sector. The Health Education, Health and Allied Workers Union (Nehawu) said the number of posts mentioned by the president was not enough to address the issues faced in the healthcare sector. 

“As Nehawu, we hold a strong view that this number is very little and that more posts would have to be filled in order for the public health sector to perform at its optimum best. By July a study revealed that the public service has 37 000 vacant posts. Our members and workers are subjected to perform duties that are meant for five other people,” said the union.  

The FF-Plus called the package a “lip service” as it was unlikely to increase investor confidence and investment. 

“The plans announced by President Cyril Ramaphosa to stimulate economic growth in South Africa seem like nothing more than lip service to the voters and investors who are concerned and displeased with the fact that the country's economy is going from bad to worse. The FF Plus holds the opinion that the reprioritising of public expenditure to facilitate job creation must not result in greater debt and more loans. The government must simply keep to its budget,” said the FF-plus. 

With the package expected to focus on manufacturing, which is seen as a key industry in job creation, trade union the South African Clothing and Textile Workers’ Union (Sactwu) says it’s pleased with the package. 

"We welcome the specifics relating to the sectors in which we are organised and have members, specifically; the promised greater support for the clothing and textile sector, the most labour-intensive sector in the manufacturing industry. And the intended vigorous crackdown on illegal imports, which will provide a stimulant to local manufacturers as well as much needed job protection,” said the union. 

Ramaphosa said Finance Minister Nhlanhla Nene would provide a breakdown of the R50 billion in budget spending that will be reprioritised at the medium-term budget speech next month. 


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