South Africa: State of the Nation Address by President Jacob Zuma, 12 Feb. 2012

9 Feb 2012

Honourable Speaker of the National Assembly,
Chairperson of the National Council of Provinces;
Deputy Speaker of the National Assembly and Deputy Chairperson of the NCOP;
Deputy President of the Republic, Honourable Kgalema Motlanthe;
Former Deputy President FW De Klerk,
Former Deputy President Baleka Mbete,
Honourable Chief Justice of the Republic, and all esteemed members of the Judiciary;
Honourable Chairperson of the SADC Parliamentary Forum and Speaker of the
Parliament of Zimbabwe; Mr Lovemore Moyo,
Honourable Ministers and Deputy Ministers,
Honourable Minister of International Relations of the Republic of Angola, Mr Rebelo Chikoti,
Honourable Minister of Foreign Affairs of the Republic of Mozambique, Mr Julio Baloi,
Distinguished Premiers and Speakers of our Provinces;
Chairperson of SALGA, and all local government leadership;
Chairperson of the National House of Traditional Leaders;
The Heads of Chapter 9 Institutions;
The Governor of the Reserve Bank;
Leaders of all sectors from business, sports, traditional and religious leaders,
Members of the diplomatic corps;
Special and distinguished guests,
Fellow South Africans,
Dumelang, good evening, goeie naand, molweni, thobela, abuxeni!

I would like to extend warm greetings to all on this important day.

It is an honour to speak to South Africans in this House and in their homes and viewing centres around the country.

I also extend a warm welcome to Ambassadors and High Commissioners representing 146 countries, with which South Africa has diplomatic relations. We value your presence in our country.

Compatriots and friends,

This State of the Nation Address takes place during a significant year in the history of our country, the centenary of the ruling party, the African National Congress.

In marking this occasion we are recognising the work of all South Africans in bringing about a truly free, non-racial, non-sexist, democratic and prosperous country.

We wish to single out the former presidents of the ANC who led our struggle for liberation and of creating a better life across generations. We salute John Langalibalele Dube, Sefako Makgatho, Zac Mahabane, Josiah Gumede, Pixley ka Isaka Seme, AB Xuma, JS Moroka, Chief Albert Luthuli, Oliver Tambo, Nelson Mandela and Thabo Mbeki.

We welcome the families of the former ANC Presidents who are our special guests this evening.

We also recognise other components of the liberation movement – the Black Consciousness Movement which was led by Mr Steve Biko, whose son Samora is also our special guest, and the Pan-Africanist Congress which was led by Mr Robert Sobukwe.

We acknowledge too, the contribution of the late former MP, Ms Helen Suzman, who was a lone voice in this very House, speaking out against oppressive laws.

Honourable Members,

Compatriots and friends,

The year 2012 is also special because it marks the 16th anniversary of the Constitution of the Republic, which gives full expression to our democratic ideals.

The Constitution is South Africa’s fundamental vision statement, which guides our policies and actions. We reaffirm our commitment to advance the ideals of our country’s Constitution at all times.

Compatriots and friends,

At the January Cabinet lekgotla, we decided to undertake a mid-term review, looking at progress from 2009 till now instead of the usual annual review.

The mid-term review indicated steady progress in various areas such as health, education, the fight against crime, human settlements, energy, water provision, rural development and others.

However, the triple challenge of unemployment, poverty and inequality persists, despite the progress made. Africans, women and the youth continue to suffer most from this challenge.

Somlomo nosihlalo abahloniphekileyo,

Njengekhabhinethi kazwelonke sithathe isinqumo sokuthikufanele senze ngokwedlulele, ukukhulisa umnotho wezwe, ukuze siqede lezizinkinga zokwesweleka kwemisebenzi, ubumpofu kanye nokungalingani ezweni.

Ilezo zinto ezintathu esizobhekana nazo ngqo, kulonyaka naseminyakeni ezayo.

Compatriots,

When freedom was attained in 1994, South Africa inherited a problem of structural unemployment which goes back to the 1970s. Employment continued to deteriorate in the 1990s and the early 2000s due to slow growth and declining employment in gold mining and agriculture.

Although jobs grew rapidly during the boom of 2003 to 2008, unemployment did not fall below 20%.

Employment received another setback in the recession of 2009.

Fortunately, Government entered the 2008-2009 recession with healthy public finances, and a comparatively low level of debt.

This allowed for a flexible response to deteriorating economic conditions.

For example, we increased spending on social security and on infrastructure development to stimulate the economy, mainly through the 2010 FIFA Soccer World Cup build programme.

Informed by some of these difficulties and the need to move away from piecemeal planning, we took a decision in 2009 to establish the National Planning Commission and asked them to produce a national development plan for the country, informed by the Constitution of the Republic.

The Commission released the first draft of the National Development Plan for consideration, which looks at where we want to be in 20 years’ time.

The Plan also directly addresses the elimination of poverty and inequality as critical points that must be attended to.

The solution for the country therefore, is higher growth and job creation to reduce and ultimately eradicate poverty and inequality.

As a developmental state that is located at the centre of a mixed economy, we see our role as being to lead and guide the economy and to intervene in the interest of the poor, given the history of our country.

Informed by this responsibility, in2010 we launched the New Growth Path framework and identified our job drivers as infrastructure development, tourism, agriculture, mining, manufacturing and the green economy.

We declared 2011 the year of job creation, and mobilised our social partners, namely business, labour and the community sector, to work with us in implementing the New Growth Path.

The results are encouraging, although we are not out of the woods yet, given the global economic situation.

The fourth quarter figures released on Tuesday, indicate that the rate of unemployment has come down from twenty-five percent to 23.9% as a result of new jobs.

During 2011, a total of 365 000 people were employed. This is the country’s best performance since the recession of 2008.

What is also important is that all the new jobs are in the formal sector of the economy, in sectors such as mining, transport, community services and trade to name a few.

There are two main things that we did right in 2011 which are contributing to this joint success.

Firstly, we mainstreamed job creation in every government entity including state owned enterprises.

Secondly, we strengthened social dialogue and cooperation between government, business and the community sector.

The Accords, signed by government, business and labour on procurement, skills development, basic education, and the green economy, confirm our common purpose and determination to build this country.

Government alone cannot solve the challenges faced by the country, but working together, solutions are possible.

Compatriots,

Let me take this opportunity to report back on the undertakings made in the SONA last year.

The Job Fund which we announced last year began operating in June. Over 2 500 applications were received in the first round. Project allocations of over one billion rand have been committed.

We had also announced 20 billion rand worth of incentives under Section 12(i) of the Income Tax Act, designed to support new industrial projects and manufacturing, and seven projects with an investment value of 8,4 billion rand were approved.

The procurement regulations empowering the Department of Trade and Industry to designate specific industries where local content is prescribed came into effect in December.

The sectors include clothing textiles, canned vegetables, leather and footwear.

Progress has also been made in amalgamating small business institutions, and a new entity will be launched this year.

We had announced 10 billion rand to be set aside by the IDC for job creation.

To date, about one point five billion rand was approved for 60 companies to promote job creation.

Compatriots and friends,

The mining industry, one of the job drivers in the New Growth Path, plays a critical role in the socio-economic development of the country.

As part of addressing the triple challenge of poverty, inequality and unemployment, government has developed a beneficiation strategy, which seeks to provide opportunities in the downstream part of the minerals sector.

We remain committed to the creation of a favourable and globally competitive mining sector, and to promote the industry to attract investment and achieve both industrial growth and much-needed transformation.

Honourable Speaker,

Honourable Chairperson of the NCOP,

The work done last year indicates that if we continue to grow reasonably well, we will begin to write a new story about South Africa—the story of how, working together, we drove back unemployment and reduced economic inequality and poverty.

It is beginning to look possible.

We must not lose this momentum.

For the year 2012 and beyond, we invite the nation to join government in a massive infrastructure development drive.

Baba Somlomo noSihlalo,

Sizoqala umkhankaso omkhulu wokwakha izingqalazizinda ezweni lonke. Lokhu kuzophakamisa izinga lomnotho, futhi kuveze amathuba emisebenzi.

Compatriots,

We will use the project management expertise gained during the 2010 FIFA Soccer World Cup to make this project a success.

The infrastructure plan will be driven and overseen by the Presidential Infrastructure Coordinating Commission, (PICC), which was established in September, bringing together Ministers, Premiers and Metro Mayors under the leadership of the President and the Deputy President.

The PICC has identified and developed projects and infrastructure initiatives from state-owned enterprises as well as national, provincial and local government departments.

These have been clustered, sequenced and prioritised into a pipeline of strategic integrated projects.

We have chosen five major geographically-focussed programmes, as well as projects focusing on health and basic education infrastructure, information and communication technologies and regional integration.

The projects are as follows;

Firstly, we plan to develop and integrate rail, road and water infrastructure, centred around two main areas in Limpopo: the Waterberg in the Western part of the province and Steelpoort in the eastern part.

These efforts are intended to unlock the enormous mineral belt of coal, platinum, palladium, chrome and other minerals, in order to facilitate increased mining as well as stepped-up beneficiation of minerals.

Using the developments in Limpopo as a base, we will expand rail transport in Mpumalanga, connecting coalfields to power stations.

This will enable us to decisively shift from road to rail in the transportation of coal, which has caused a deterioration of the roads in Mpumalanga.

The eastern parts of the North West province will also benefit from the greater focus on infrastructure connected to mining and mineral beneficiation.

Secondly, we will improve the movement of goods and economic integration through a Durban-Free State-Gauteng logistics and industrial corridor.

This project is intended to connect the major economic centres of Gauteng and Durban/Pinetown, and at the same time, connect these centres with improved export capacity through our sea-ports.

In this regard, I am pleased to announce the Market Demand Strategy of Transnet, which entails an investment, over the next seven years, of three hundred billion rand in capital projects.

Of this amount, 200 billion rand is allocated to rail projects and the majority of the balance, to projects in the ports.

Amongst the list of planned projects, is the expansion of the Iron Ore Export channel from 60 million tons per annum to 82 million tons per annum.

It also includes various improvements to the Durban-Gauteng Rail corridor and the phased development of a new 16 million tons per annum manganese export channel through the Port of Ngqura in Nelson Mandela Bay.

The Market Demand Strategy will result in the creation of more jobs in the South African economy, as well as increased localization and Black Economic Empowerment. It will also position South Africa as a regional trans-shipment hub for Sub-Saharan Africa and deliver on NEPAD’s regional integration agenda.

We have also been looking at the necessity of reducing port charges, as part of reducing the costs of doing business. The issue of high port charges was one of those raised sharply by the automotive sector in Port Elizabeth and Uitenhage during my performance monitoring visit to the sector last year.

In this regard, I am pleased to announce that the Port Regulator and Transnet have agreed to an arrangement which will result in exporters of manufactured goods, receiving a significant decrease in port charges, during the coming year, equal to about 1 billion rand in total.

Thirdly, we will develop a major new South Eastern node that will improve the industrial and agricultural development and export capacity of the Eastern Cape region, and expand the province’s economic and logistics linkages with the Northern Cape and KwaZulu-Natal.

In the former Transkei part of the Eastern Cape, we are committed to building a dam using the Umzimvubu River as the source, in order to expand agricultural production.

In addition, the implementation of the Mthatha revitalization project, which is a Presidential special project, is proceeding very well.

Work is at an advanced stage to improve water, sanitation, electricity, roads, human settlements, airport development and institutional and governance issues.

Fourthly, in the North West, we will expand the roll-out of water, roads, rail and electricity infrastructure. Ten priority roads will be upgraded.

Fifthly, we see enormous potential along the west coast of the country and need to improve infrastructure to unlock this potential.

Our plans include the expansion of the iron-ore rail line between Sishen in Northern Cape and Saldanha Bay in the Western Cape, which will create large numbers of jobs in both provinces.

The iron-ore capacity on the transport-side will increase capacity to 100 million tons per annum.

This will allow for the expansion of iron-ore mining over the next decade to feed the developing world’s growing investment in infrastructure and industrial activities.

Compatriots,

We have also identified critical social infrastructure projects. These include projects aimed at laying the basis for the National Health Insurance system such as the refurbishment of hospitals and nurses’ homes.

A total of 300 million rand has been allocated for the preparatory work towards building new universities in Mpumalanga and Northern Cape.

Another infrastructure project with great potential is South Africa’s bid to host the Square Kilometre Array radio telescope in partnership with eight other African countries. The winning bid will be announced next month. We urge you to support the country’s bid.

Lastly, our infrastructure work extends beyond our borders. South Africa champions the North-South Road and Rail Corridor, which is part of the African Union’s NEPAD Presidential Infrastructure Championing initiative.

Work in this regard, comprises various inter-related projects that cover roads and railways, border crossings, energy and information and communication technologies.

Compatriots,

The massive investment in infrastructure must leave more than just power stations, rail-lines, dams and roads. It must industrialise the country, generate skills and boost much needed job creation.

I will convene a Presidential infrastructure summit to discuss the implementation of the plan with potential investors and social partners.

Honourable Speaker, Honourable Chairperson of the NCOP,

I would now like to discuss matters relating to the extension of basic services, addressing inequalities, peace and security and social cohesion.

I received a lot of valuable correspondence in the run-up to this SONA. Such interaction enables us keep in touch with our people and their needs.

I received an email relating to a housing problem from Mzukisi Mali, a public servant from the Fingo area in Grahamstown. He wrote;

“In 1994 my income was too high to get an RDP and too low to get a

bond, this continued until to date.I have three children and my

wife is not working.

“When I apply for an RDP I am told that I do not qualify and cannot get a bond because I am risky to the banks…’’

Fortunately we have gone some way to address the problem facing Mr Mali and many others.

In 2010, we announced a one billion rand guarantee fund to promote access to loans.

We are pleased to report that this fund will start its operations in April, managed by the National Housing Finance Corporation. The scheme will enable the Banks to lend to people who are in a similar situation as Mr Mali.

In addition, from April, people earning between three thousand five hundred rand and

R 15 000, will be able to obtain a subsidy of up to R83 000 from Provinces, to enable them to obtain housing finance from an accredited Bank.

Ungalilahli ithemba Mr Mali nabaningi abanye, kuzolunga ngenxa yalomxhaso ozotholakala kohulumeni bezifundazwe, kanye nalomshwalense omusha ozokwenza kubelula kumabhange ukuthi aniboleke imali.

Compatriots,

There is an ongoing concern from business and communities about high electricity costs.

I have asked Eskom to seek options on how the price increase requirement may be reduced over the next few years, in support of economic growth and job creation and give me proposals for consideration.

We need an electricity price path which will ensure that Eskom and the industry remain financially viable and sustainable, but which remains affordable especially for the poor.

However to achieve sustainability, a pact will be required with all South Africans – including business, labour, municipalities, communities and all customers and suppliers.

We must save electricity.

For the next two years, until the Medupi and Kusile power stations come into operation, the electricity system will be very tight.

We should all play our part in order to avoid load shedding.

To increase energy capacity we will continue searching for renewable energy sources, especially solar electricity and biofuels as we implement the Green Economy Accord with economic stakeholders.

To date we have installed more than 220 000 solar geysers nationwide.

The Government target is one million solar geysers by 2014-2015.

Honourable Members,

Compatriots,

Government continues to extend access to basic water supply. However, clearly, water access is still a challenge in some areas.

An email from Mmatsheko Pine from Hammanskraal is a case in point.

The writer says; “There is the area called Ngobi near Hammanskraal, under Moretele Local Municipality, the people residing in the area are now old, aged and mostly sick.

“The area has been without water for the past two years. People rely on rain to harvest water.

There are water pipes and machines installed but the problem is said to be pressure to pump water. Could your office kindly assist with the powers that be?”.

I have asked the Minister of Water and Environmental Affairs to investigate this matter with a view to finding an urgent solution.

Water expansion has been delayed in some parts of the country due to a lack of infrastructure.This is being attended to. For example, five new water augmentation schemes are on schedule.

These are Olifants River Water Resource in Steelpoort in Limpopo Province, the Vaal River Eastern Sub-System in Secunda in Mpumalanga, Komati Water Augmentation Scheme in Nkangala in Mpumalanga, the raising of Hazelmere dam in KwaZulu-Natal and the Clan William Dam in Clan William in the Western Cape. In addition, nine out of 25 dams have been rehabilitated.

In relation to the announcements we made during the United Nations COP 17 climate change conference, an amount of 248 million rand is to be invested over next two years to deal with the issue of Acid Mine Drainage in Witwatersrand.

Let me take this opportunity to congratulate the inter-ministerial committee on COP 17 for making the conference a huge success

The final outcome of COP 17 was historic and precedent setting, ranking with the 1997 conference where the Kyoto Protocol was adopted.

Building on the success of COP 17, South Africa will participate in the Rio plus 20 Summit in Brazil, which marks the 10th anniversary of the World Summit on Sustainable Development.

Honourable Speaker and Honourable Chairperson,

Our intensive focus on education is paying off.

We are pleased that the matric percentage pass is on an upward trend.We congratulate the teachers, learners, parents and the communities for the efforts.

We will continue to invest in producing more teachers who can teach mathematics, science and African languages.

Compatriots,

Our call to teachers to be in school, in class, on time, teaching for at least seven hours a day remains pivotal to success. We thank the teacher unions for supporting this campaign.

A major achievement is the doubling ofGrade R enrolment, from 300 000 in 2003 to 705 000 in 2011. We appear poised to meet our target of 100% coverage for Grade R by 2014.

To fight poverty and inequality and to keep learners in school, over 8 million learners attend no-fee schools while over eight million benefit from government’s school feeding scheme.

Last year, national government instituted a Section 100 (1)(b) intervention in the Eastern Cape, to assist the department of education to improve the delivery of education.

Problems included non-delivery of textbooks, non-payment of scholar transport, excess teachers and a general poor culture of learning and teaching.

The implementation of the intervention will continue and we are working well with the province in this regard. Sizimisele ukwenza immeko yemfundo ibengcono eMpuma Koloni. We call on all stakeholders to work with us to make this turnaround a success.

Compatriots,

During the 2010 FIFA Soccer World Cup, we resolved that the South African legacy would be to promote universal access to education.

School attendance in the country is now close to 100 percent for the compulsory band, 7-15 years of age.But we remain concerned by the report of the General Household Survey in 2010 that just over 120 000 children in that band are out of school.

Grade 10 drop outs appear to be a problem, particularly in the rural and farm areas of the Western Cape.

The national Government will work closely with the Western Cape government, to trace these learners and provide support so that they do not lose their future.

With regards to higher education, we are exceeding targets. Close to 14 000 learners were placed in workplace learning opportunities over the past year, and over 11 000 artisans have completed their trade tests.

Siyajabula ukubona ukuthi liyanda inani lentsha efunda amakhono kulamakolishi abizwa phecelezi ngama-Further Education and Training Colleges.

Siyaninxusa bazali ukuthi nigqugquzele izingane zifunde kulamakolishi. Akufanele zicabange ukuthi imisebenzi ifundelwa emanyuvesi kuphela.

Siyawadinga amakhono atholakala kulamakolishi.

To expand access to tertiary education as per our announcement last year,200 million rand was utilised to assist 25 000 students to pay off their debts to institutions of higher learning.

Compatriots and friends,

We congratulate the health sector as well as the South African National Aids Council led by the Deputy President of the Republic on the success of the HIV and AIDS programme.

While we are doing well with regards to treatment and the prevention of mother to child transmission, general prevention efforts must also be accelerated.

We also wish to encourage South Africans to live healthier lives to reduce the impact of non-communicable diseases such as diabetes, heart disease and hypertension.

Compatriots and friends,

The year 2013 will mark the centenary of the Natives Land Act of 1913, which took away 87 percent of the land from the African people.

The Constitution requires that the State must realise the restitution of land rights for those who were dispossessed by the 1913 law.

We have only distributed 8% of the 30% target of land redistribution for 2014 that we set ourselves. The process is slow and tedious and there is general agreement that the willing buyer- willing seller option has not been the best way to address this question.

That is why have introduced a new policy framework, the Green Paper on Land Reform.

We urge the public to participate in the process of improving land redistribution and reform to reverse the impact of the 1913 Act.

Honourable Speaker,

Compatriots,

On economic transformation, we are amending the Broad-Based Black Economic Empowerment Act. The amendments amongst other things, establish a statutory Commission that would deal with non-compliance and circumvention.

The proposed law will also criminalise fronting and other forms of empowerment misrepresentation.

With regards to issues of disability, we have directed all government departments to ensure that we meet the target we set several years ago of having 2% of people employed in the Public Service to be disabled persons.

We are also working towards a

Women Empowerment and Gender Equality Bill, to promote compliance in both government and the private sector and to provide for sanctions in the case of non-compliance.

Meanwhile, the NEDLAC Process on the Atypical Forms of Employment and Labour Broking has now been completed.

Government seeks to eliminate all forms of abusive practices inherent in labour broking, in order to strengthen the protection of vulnerable workers. We trust that common ground will be found this year on this matter.

Compatriots,

In 2009 we made a commitment to accelerate the fight against crime and corruption.

The crime statistics for the period 2010/2011 indicate that our country witnessed a decline of 5% in the number of reported serious crimes compared to the previous year.

We will however, not become complacent. We are continuing to implement our programmes of making South Africans feel safe and to be safe.

We also continue to improve the performance of the state in various ways, including the fight against corruption.

The Multi-Agency Working Group on procurement led by the National Treasury, SARS and the Financial Intelligence Centre is reviewing the entire state procurement system to ensure better value for money from state spending.

Initiatives include the vetting of supply chain personnel in government departments.

To further improve security, the Department of Home Affairs, signed a Memorandum of Understanding with the banking industry, to roll out the online fingerprint verification system in all participating banks, to assist in fraud prevention and detection.

Compatriots and friends,

We are working with various provinces to improve governance, systems and administration.

These include Gauteng to improve health service delivery, the Free State on transport and roads and Limpopo to improve governance and financial administration in five departments, including the provincial treasury.

We welcome the launch of Corruption Watch by COSATU, as well as the recent agreement between government and business to implement anti-corruption programmes.

These interventions will complement the work of government in combating corruption.

Compatriots and friends,

As part of promoting social cohesion, this year we will undertake and continue many heritage projects.

Museums and centres to be unveiled will include the 1980 Matola Raid museum in Maputo, the Ncome museum in KwaZulu-Natal, phase 2 of the Freedom Park museum and the Steve Biko heritage centre in Ginsberg in King Williamstown.

We have also prioritised thehomes and graves of former ANC Presidents and other national heroes including Thomas Maphikela, Lillian Ngoyi, Walter and Albertina Sisulu, Griffiths and Victoria Mxenge, Robert Sobukwe and others.

Memorial sites to be prioritised include that of the Pondo Revolt, the sites of the Frontier Wars, the 1913 revolt by African women in the Free State, the 1957 anti-pass revolt by women in Zeerust, the Rocklands Civic Centre in Mitchells Plein where the United Democratic Front was formed and the Gugulethu Seven monument in Cape Town.

We are also in the process of purchasing and rehabilitating the Winnie Mandela house in Brandfort, the Dr. Moroka house in Thaba Nchu and the Bram Fischer house in Westdene.

Additional projects include the launch of the Dube Tradeport and the unveiling of the statue of John Dube at King Shaka International Airport next month and renaming the Kings House presidential residence in Durban after Dr Dube.

The Presidential Guest House in Pretoria will be named after Mr Sefako Makgatho and the Diplomatic Guest House in Pretoria after the late prolific diplomat, Mr Johnny Makatini.

Government will also table the National Traditional Affairs Bill which makes provision for the recognition of the Khoi-San communities, their leadership and structures.

It is important to remember that the Khoi-San people were the most brutalised by colonialists who tried to make them extinct, and undermined their language and identity. As a free and democratic South Africa today, we cannot ignore to correct the past.

I discussed this matter extensively with the Khoi-San community when I met with them in Cape Town last year and we agreed to work together to redress the injustices of the past.

Compatriots,

Next year 2013, the seat of government, the majestic Union Buildings, will mark 100 years of existence and planning will start this year to mark the centenary.

Fellow South Africans,

We must perform better in sports this year! Our star performer, Oscar Pistorius has set the standard for the year by winning the 2012 Laureus Sportsperson of the Year with a Disability Award.Congratulations for this achievement.

We also congratulate the national women’s soccer team Banyana Banyana for qualifying for the London Olympics for the first time. With our support, they will do well.

We have been given the honour to host the Africa Cup of Nations next year, replacing Libya as they are unable to do so.

Compatriots,

Allow me to use this opportunity to extend heartiest congratulations and good wishes to Mama Rebecca Kotane, wife of former ANC treasurer general, Moses Kotane and SACP general secretary, who will turn 100 years old on Sunday the 12th of February.

The Young Men’s Guild of the Methodist Church of Southern Africa, Amadodana aseWesile, is also celebrating 100 years this year.

Another centenary celebration is that of Omama Besililo of the United Congregational Church of South Africa.

We wish them all successful celebrations.

Compatriots,

We have outlined a busy infrastructure implementation programme for now until 2014 and beyond.

I would like to appeal to all our people to join hands as they always do, as we deal decisively with the triple challenges of unemployment, poverty and inequality. Nobody will do this for us, it is in our hands. And we are all equal to the task.

As we get back to work tomorrow, let us internalise the words of ANC Women’s League founding president Charlotte Maxeke who said in her Presidential address to the National Council of African Women.

“This work is not for yourselves — kill that spirit of self, and do not live above your people, but live with them. If you can rise, bring someone with you’’.

I thank you.

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Letter on: Article on Manny vs Floyd in city? Friday,January 13th. (Cape Times)

Dear Editor

The lead article in today’s Cape Times, Manny vs Floyd in City? (Cape Times, January 13), refers to the event as a “dream fight” for the Cape Town Stadium. The article lauds the two boxers, Floyd Mayweather Jr and Manny Pacquia Friday as “the world’s top two glamour fighters” and Grant Pascoe, Mayco member for Cape Town tourism, events and marketing, is quoted as remarking: “It would be a major coup for the city should the fight materialize as it would be major exposure for the city.” The article also reports that Floyd Mayweather Jr is to serve a 90-day sentence for domestic violence in June this year.

We ask, why is it that the Cape Times, the City of Cape Town and the general public think it is acceptable to valorize a man convicted of domestic violence? Why should we want an abuser in a boxing ring in South Africa, and why should we treat him as a “glamour fighter,” thereby holding him up as a role model for young people?

In December every year, during the 16 Days of Activism Against Gender Violence campaign, we wring our hands and politicians clamour to be seen to be making grand statements about what needs to be done to prevent violence against women, but then rapidly go back to ignoring and/or trivializing the problem.

The Cape Times’ report normalizes domestic violence, subordinates it in importance to the glamour of a contact sport and belittles domestic violence survivors’ experiences. It seems the very least that we can do, if we are serious about combating violence against women, is to say no thanks to Mr Floyd Mayweather Jr and his ilk, and to call on the Mayco to stop this glorification of an abuser.

Phyllis Orner and Leslie London

Observatory

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Grahamstown Police brutality *happened a few hrs ago*

URGENT from Unemployed
People’s Movement and Students for Social Justice:

Ayanda Kota Beaten up by police and arrested Unemployed People’s Movement Press Statement Ayanda Kota Assaulted in the Grahamstown Police Station – Under Arrest

About 40 minutes ago Ayanda Kota was seriously assaulted by a group of police officers in the Grahamstown police station. He was dragged, bleeding from at least two wounds, and with his clothes torn from his body, to the holding cells.

For some months he has been under open police surveillance and at times has been threatened and insulted by the police. The police have been watching his mother’s house and have searched it looking for him. Their behaviour has been very rude, threatening and aggressive.

Today Ayanda was summoned to the police station. He popped out of a meeting organised by Masifunde and the Rural People’s Movement with his six month old son and a comrade. He was called to the police station because a lecturer at Rhodes, who has publicly engaged in strange and aggressive behaviour on a number of occasions, laid a charge of theft against Ayanda after he misplaced a book that she had leant him. Ayanda did not steal the book – he mislaid it. This is something that happens all the time to people that share books. Perhaps another comrade picked it up and forget to return it. Perhaps it was left in a taxi. These things happen. Ayanda has made it quite clear that he is willing to replace the book.
As soon as Ayanda met Constable Zulu, the officer that had summoned him to the station, Constable Zulu said that he was taking him straight to the cells. Ayanda said that he wanted to show the officer text messages on his cellphone to the lecturer at Rhodes offering to replace the book but the officer insisted that Ayanda was going straight to the cells. Ayanda then asked to be able to take his son home first. At that point Constable Zulu lunged at Ayanda very aggressively. Ayanda raised his arm in an instinctive gesture of defence following which Zulu began to assault him with blows to the head. Three or four other police offices then joined the assault. Ayanda was on the floor for most of the duration of the assault which went on for some minutes. This happened in the presence of his six year old son who of course was traumatised.

The assault was brutal, entirely unnecessary and accompanied by, in Constable Zulu’s case, an obvious sadistic delight. A police secretary who witnessed it all burst into tears.One of the police officers made a sarcastic remark about Ayanda being the newsmaker of the year in the local paper. This was plainly no ordinary arrest.

This is a bogus charge that most certainly does not justify arrest. There was nothing to justify the assault. This is a simple attempt on the part of the police to misuse a ridiculous charge laid by someone well known for strange and erratic behaviour in order to intimidate an activist and the movement that he represents.
The police are not here to protect society. They are here to protect the ruling party from popular dissent. This is not an isolated incident. Poor people’s movements have been constantly subject to this sort of behaviour at the hands of the police for many years now.

UPM will try to visit Ayanda in the holding cells and will mobilise to get him medical attention tonight and to support him in court tomorrow. The movement is currently looking for a lawyer. Of course civil and criminal charges will be laid against Constable Zulu and all the other police officers who joined this assault.

For more information please contact Xola Mali on
+27(0)72 299 5253

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SPORT & RECREATION CO-ORDINATOR: YOUTH CENTRE IN MASIPHUMELELE

The Desmond Tutu HIV Foundation (DTHF) is a registered non-profit organisation focused on the pursuit of excellence in research, treatment and prevention of HIV and related infections inSouthern Africa. 

 

We invite applications for a 1 year contract post as the Sports & Recreation Co-ordinator at the Youth Centre in Masiphumelele

 

PURPOSE OF THE POSITION

 

The Recreation Co-ordinator is responsible for planning, implementation & co-ordination of Sports & Recreational programmes & management of all recreation facilities at the Youth Centre  in order to provide clean and safe opportunities for sport and recreation and promote a healthy lifestyle for all participating young people.

 

Requirements:

  • Minimum Grade 12 education
  • Relevant Sport & Recreational Management qualification
  • 3 years’ experience in co-ordinating sports, drama & music programmes for young people
  • Lateral creative thinking & detail orientated
  • Supervisory, decision making and analytical skills
  • Willingness to take on new responsibilities & challenges
  • Passion to work with youth and provide a youth friendly environment
  • Reliability, dependability and a well-developed work ethic
  • Valid driver’s license & PDP

 

Responsibilities:

  • Develop, plan and implement age & gender specific sports, drama & music programmes at the Youth Centre
  • Co-ordinate Partner facilitators & volunteers to run relevant sports & recreation programmes
  • Find and foster relationships with new local partners, facilitators and volunteers
  • Manage maintenance of  sports & recreation facilities and equipment
  • Co-ordinate sporting competitions and recreational field trips
  • Promote sport & recreation programmes in the local communities
  • Co-ordinate programmes with Education Co-ordinator & Medical Research Co-ordinator
  • Maintain discipline and safe healthy practice by participants
  • Perform other duties as assigned

 

 

If you meet the criteria as set out above and are interested in the position please send a covering letter and concise CV (no certificates) which includes contact details of 2 referees to Jobs@hiv-research.org.za or fax  021 633 0182 (indicating the name of the position that you apply for). You can also drop them off at the Desmond Tutu HIV Foundation youth centre in Guinea Fowl Road opposite Masiphumelele High school by 20 January 2012.

 

NB: only short-listed candidates will be contacted. We are committed to equity in our employment practices. It is our intention to appoint individuals with the aim of meeting our equity objectives. We reserve the right not to appoint if no suitable candidates are identified. If you have not heard from us within two weeks after the closing date please consider you application as unsuccessful.

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Open Letter to Black Grade 12s from BLACKWASH

The statement below was first published in the City Press in December 2009. The issues it raises are still very relevant.

Hi Black grade 12s

Look, there is a very big chance you will fail the 2009 Grade 12 examinations. Each year, thousands of black learners who write these exams do not make it and an even bigger number never even get to Grade 11 or 10. A large percentage of those who do pass, do not have good enough results to go to university or simply cannot afford the fees. So there is clearly a problem, yet each year prayer meetings are held and ‘good luck’ messages are sent in the hope that all matric students will pass, but none of these confront the simple reality that black learners in this country are likely to fail. This is a hard truth we can no longer ignore, in the same way that we cannot ignore the fact that the majority of white learners are guaranteed to pass.

But why is this the case? Why is it that white learners can be sure of passing Grade 12 while most blacks who are in township schools are more likely to fail? Is it because white learners are naturally smarter and harder working than black learners? Are the blacks in Model C schools perhaps cleverer than blacks in township schools since they also pass well and have better chances of going to university to further their studies. Or maybe this has nothing to do with individual blacks and individual whites at all, but with how the South African system favours whites to blacks in all situations. But what exactly do we mean by this?

We all know that during apartheid blacks had to study under Bantu Education which was an inferior form of education compared to what whites got. Black people were oppressed in all forms of life and Bantu Education was just one of the many ways of ensuring that they would remain oppressed and work for whites. Under apartheid, black schools had bad text books or none at all, no stationary or libraries. The schools were also overcrowded because the white government simply refused to build more schools for blacks while white classes were small enough for each learner to get the necessary attention they needed. Black schools also didn’t have enough sports facilities or extra mural activities while white schools provided activities such as chess, music lessons, swimming, debating, drama, art classes etc etc. All of these things cost money to provide and the white government put more money into white schools than into black schools as a way of oppressing blacks. And this money they used to build better schools in white areas was mostly from gold, diamond and platinum mines which black people worked on while earning peanuts. In other words, black people worked as slaves on farms and mines so that white kids could get a good education. And the white government was right to look after white learners because it was in power at the time; in fact it would have been foolish not to do so. We must ask ourselves though why these conditions persist even after a black government has been put in power.

In the last fifteen years of democracy, nothing much has changed. Township schools are still getting a type of Bantu Education that results in very low pass rates amongst black learners. (Even if this education is given all sorts of names like OBE, it remains Bantu Education for blacks). Most of the teachers in township schools were also educated under apartheid and do not have the necessary skills that white teachers have. And so the reality is that even though we now live at a time when blacks and whites are supposed to get equal opportunities, blacks who are in township schools have little opportunities or skills. For example, a Grade 7 learner in a white school is more likely to have better mathematics and literacy skills than a black learner in matric. So black learners fail Grade 12 because they have been systematically underprepared from Grade 1. Even those who manage to pass and go to university often fail their first year because they don’t have good reading and writing skills. This means that out of all the Grade 12 learners who wrote the 2009 exams, a very small number of black learners have a chance to get good jobs in three to four years time. Many of them will join the unemployed blacks who are trapped in townships and struggling to make ends meet.

But each year the Department of Education promises that things will get better and that they need more time. While young people wait for things to get better the country builds expensive stadiums that we don’t need and the children of our government ministers go to fancy schools where they are guaranteed to pass.

In countries where the government is serious about making sure that blacks are not oppressed, education is always made a priority. In Haiti, for example, the pro-black government of President Aristide, reduced illiteracy levels by a large percentage in less that four years.

In Burkina Faso too, Thomas Sankara was president for only four years before he was killed but he had managed to put in very good education programmes for the black poor and was very unpopular with the white world for doing this. Both of these countries are much smaller and poorer than South Africa but their leaders were revolutionaries who wanted to see the end of white power.

After this year’s results are announced many individual black learners in rural and township schools who did exceptionally well will be praised for their hard work and dedication. We will be told by the newspapers that all black learners in townships who work hard can also do well. But this is a lie. The majority of white learners pass well whether they work hard or not and black learners also fail either way. If you fail you may blame yourself, see it as a personal failure and be depressed as a result even though you have been set-up to fail by forces beyond your control. Some parents might also think they are personally responsible for their kids’ bad results even though the responsibility lies with our government which continues to make life a breeze for whites and a living hell for blacks.

As the revolutionary leader Che Guevara said, “An uneducated people is easy to deceive”. We must not allow ourselves to be deceived into believing that this is the best that we deserve and demand a better education. The youth who fought the Apartheid government in 1976 didn’t die for things to be like this. Its time to take action. Vuka Darkie!

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Open Letter to Black Grade 12s from BLACKWASH

The statement below was first published in the City Press in December 2009. The issues it raises are still very relevant.

Hi Black grade 12s

Look, there is a very big chance you will fail the 2009 Grade 12 examinations. Each year, thousands of black learners who write these exams do not make it and an even bigger number never even get to Grade 11 or 10. A large percentage of those who do pass, do not have good enough results to go to university or simply cannot afford the fees. So there is clearly a problem, yet each year prayer meetings are held and ‘good luck’ messages are sent in the hope that all matric students will pass, but none of these confront the simple reality that black learners in this country are likely to fail. This is a hard truth we can no longer ignore, in the same way that we cannot ignore the fact that the majority of white learners are guaranteed to pass.

But why is this the case? Why is it that white learners can be sure of passing Grade 12 while most blacks who are in township schools are more likely to fail? Is it because white learners are naturally smarter and harder working than black learners? Are the blacks in Model C schools perhaps cleverer than blacks in township schools since they also pass well and have better chances of going to university to further their studies. Or maybe this has nothing to do with individual blacks and individual whites at all, but with how the South African system favours whites to blacks in all situations. But what exactly do we mean by this?

We all know that during apartheid blacks had to study under Bantu Education which was an inferior form of education compared to what whites got. Black people were oppressed in all forms of life and Bantu Education was just one of the many ways of ensuring that they would remain oppressed and work for whites. Under apartheid, black schools had bad text books or none at all, no stationary or libraries. The schools were also overcrowded because the white government simply refused to build more schools for blacks while white classes were small enough for each learner to get the necessary attention they needed. Black schools also didn’t have enough sports facilities or extra mural activities while white schools provided activities such as chess, music lessons, swimming, debating, drama, art classes etc etc. All of these things cost money to provide and the white government put more money into white schools than into black schools as a way of oppressing blacks. And this money they used to build better schools in white areas was mostly from gold, diamond and platinum mines which black people worked on while earning peanuts. In other words, black people worked as slaves on farms and mines so that white kids could get a good education. And the white government was right to look after white learners because it was in power at the time; in fact it would have been foolish not to do so. We must ask ourselves though why these conditions persist even after a black government has been put in power.

In the last fifteen years of democracy, nothing much has changed. Township schools are still getting a type of Bantu Education that results in very low pass rates amongst black learners. (Even if this education is given all sorts of names like OBE, it remains Bantu Education for blacks). Most of the teachers in township schools were also educated under apartheid and do not have the necessary skills that white teachers have. And so the reality is that even though we now live at a time when blacks and whites are supposed to get equal opportunities, blacks who are in township schools have little opportunities or skills. For example, a Grade 7 learner in a white school is more likely to have better mathematics and literacy skills than a black learner in matric. So black learners fail Grade 12 because they have been systematically underprepared from Grade 1. Even those who manage to pass and go to university often fail their first year because they don’t have good reading and writing skills. This means that out of all the Grade 12 learners who wrote the 2009 exams, a very small number of black learners have a chance to get good jobs in three to four years time. Many of them will join the unemployed blacks who are trapped in townships and struggling to make ends meet.

But each year the Department of Education promises that things will get better and that they need more time. While young people wait for things to get better the country builds expensive stadiums that we don’t need and the children of our government ministers go to fancy schools where they are guaranteed to pass.

In countries where the government is serious about making sure that blacks are not oppressed, education is always made a priority. In Haiti, for example, the pro-black government of President Aristide, reduced illiteracy levels by a large percentage in less that four years.

In Burkina Faso too, Thomas Sankara was president for only four years before he was killed but he had managed to put in very good education programmes for the black poor and was very unpopular with the white world for doing this. Both of these countries are much smaller and poorer than South Africa but their leaders were revolutionaries who wanted to see the end of white power.

After this year’s results are announced many individual black learners in rural and township schools who did exceptionally well will be praised for their hard work and dedication. We will be told by the newspapers that all black learners in townships who work hard can also do well. But this is a lie. The majority of white learners pass well whether they work hard or not and black learners also fail either way. If you fail you may blame yourself, see it as a personal failure and be depressed as a result even though you have been set-up to fail by forces beyond your control. Some parents might also think they are personally responsible for their kids’ bad results even though the responsibility lies with our government which continues to make life a breeze for whites and a living hell for blacks.

As the revolutionary leader Che Guevara said, “An uneducated people is easy to deceive”. We must not allow ourselves to be deceived into believing that this is the best that we deserve and demand a better education. The youth who fought the Apartheid government in 1976 didn’t die for things to be like this. Its time to take action. Vuka Darkie!

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Mini-Budget 2011 Speech by Minister of Finance, P. Gordhan

I have the honour to present the third Medium Term Budget Policy Statement of President Zuma’s administration.

We present this Policy Statement at a time when our own economy is recovering, but there are still winds of uncertainty in places that seem far away, which can rapidly affect us, for better or worse.

We have learnt from the 2008 global crisis that sound fiscal and financial institutions do not provide immunity against job losses in our own economy arising from turbulence originating elsewhere in the world.  Nor are they sufficient to reposition our economy on a new growth trajectory that creates jobs, reduces inequality and improves the quality of life of our people.

Our economic transformation requires much more.

It requires an extraordinary national effort from all role-players, committed not just to identifying the barriers to progress, not just to proposing solutions, but also to working together, over the long haul. 

In February, at the time of this year’s Budget, Mister President, we referred to your clear injunction:

“We want to have a country where millions more South Africans have decent employment opportunities, which has a modern infrastructure and vibrant economy and where the quality of life is high.”

We said in this Budget, Mister President, that it “reflects the collective determination of the Government to address with energy the challenges of creating jobs, reducing poverty, building infrastructure and expanding our economy. The Budget sets out a financial framework for implementing this vision, a framework that is sound and sustainable. It recognises that building South Africa is a multi-decade project that must invigorate our capacity to grow, and must include all South Africans in that growth.”

This remains our point of departure, but once again we have to take stock of this uncertain environment and review how we might better address our challenges and seize new opportunities.

For the past two years we have felt the shock waves of financial crises, first in the United States and the UK, now centred in Europe.

A year ago at the time of the 2010 MTBPS we thought we would see a sustained improvement in the global recovery and in our economy. That was not to be. The eurozone crisis has brought new financial challenges and threats to global growth, and we are also seeing rising inflation and overheating in several economies, including Brazil, India and China. Once again, we face the prospect of declines in global trade, falling industrial demand, delays in investment, liquidation of businesses and stressed financial institutions, this time with the added risk that fiscal austerity in some parts of the world will extend the slowdown and deepen the crisis.

The crisis of leadership currently reflected in the Eurozone and in Europe is having a damaging effect on the global economy including our own.  The world expects Europe to urgently mobilise the resources required to recapitalize banks and support a durable restructuring of insolvent or debt-laden economies.

The MTBPS sets out the fiscal and budgetary dimensions of the government’s response to what some have called “dangerous times”. It challenges us to confront both our immediate priorities and long-term development imperatives. It invites this House and all South Africans to join in our collective effort to do more, with the resources at our disposal, to strengthen our economic performance and improve public service delivery.

In brief, Mister Speaker, the MTBPS advises the following – 

The global environment poses considerable risks to the world economic recovery, and the outlook for our own economy.

Our tax revenue collections have not yet recovered fully from the effects of recession, and so our counter-cyclical fiscal stance allows for a temporary increase in borrowing.

Higher borrowing must be carefully managed: capital markets are volatile, and debt service costs are already the fastest growing category of expenditure.

Over the next three years, we will stabilise the debt level through fiscal consolidation and a moderation in expenditure growth.

The composition of our spending needs to change – while public service expenditure has continued to expand strongly, we are not doing enough to build a growing economy.

Therefore, we must prioritise public infrastructure spending and invest in job-creating assets.

We must also support business investment, through a competitiveness package and protect workers and enterprises affected by current economic conditions.

We will create a “policy reserve” and indicate options for reprioritizing expenditure and mobilizing other resources within the state to fund economic development priorities.

We have to address inefficiency, extravagance and waste in public administration, for trusteeship is at the heart of the contract between government and its citizens.

In confronting these challenges forthrightly, we are mindful that similar issues are faced by many other countries.

Across the world, there is rising indignation about unemployment, about inequality, about environmental degradation, about corruption, about the abuse of power. Correctly so.

Across the world, there is impatience at the slow pace and poor outcomes of international cooperation, and there is anger about the impact of financial and governance failures on ordinary people, on employment and on livelihoods. But anger is not enough – we have to act, we have to be bold and far-sighted in our resolve to move ahead with the reforms that will build a better future not just for ourselves but for generations to come.

Mr President, you have put jobs at the top of the agenda of our new growth path. Cabinet has endorsed a twelve-point programme of action and we have targets and delivery schedules for a wide range of public services, programmes, projects and activities.

Minister Chabane leads a department dedicated to monitoring and evaluating performance.

Our planning commission under Minister Manuel has provided a diagnostic assessment and will shortly release its long-term vision for public consultation and debate. (And the man in the yellow suit is knocking on our doors to ensure that we have the numbers we need to set targets and track our progress with confidence.)

Minister Nkwinti is steering a new course in development of rural livelihoods, in addition to chairing the work of our economic cluster.

Minister Patel has taken the lead in the dialogue with social partners that must underpin programmes of action not just within government but across society as a whole.

Ministers Motshekga and Nzimande are seeking better ways of managing our schools and expanding access to higher education and training opportunities.

Improvements in our justice system are in progress, under Minister Radebe’s guidance.

How do we achieve the right balance between these and other objectives in public policy? How do we manage the tension between promoting a dynamic enterprising economy and provision of collective goods and services?

The Medium Term Budget Policy Statement does not set out the details of policies or spending plans, as these are the responsibility of specific Ministers and their departments, and are still in preparation. But it provides the broad framework and it signals what is likely to be affordable. It also invites Parliament, and all stakeholders, to reflect on the choices before us, and to assist in finding the best combination of revenue measures, borrowing and spending plans, that is consistent with economic growth, sustainability, broad-based development and social progress. 

Economic outlook

In reporting on the outlook for the economy, Mister Speaker, we have to take account of the slowdown in the world economy and continuing uncertainty associated with the unresolved European debt crisis and sluggish growth in the United States. Global trade and growth at present are mainly driven by continuing expansion in China, India and other fast-growing developing countries.

Advanced economies are expected to grow by 1.6 per cent on average this year, rising to 1.9 per cent next year. Taking into account population growth, this is, at best, standing still. On the other hand, developing Asia will continue to grow at over 8 per cent a year, and Sub-Saharan Africa is projected to grow by between 5 and 6 per cent a year.

South Africa’s economic growth typically follows the average global trend quite closely. We saw a gradual recovery last year and an annualised GDP growth rate of 4.5 per cent in the first quarter of this year, but in the second quarter growth slowed to 1.3 per cent. For 2011 as a whole we now expect growth of 3.1 per cent, which is somewhat below the projection at the time of the Budget in February.

For the period ahead, growth is expected to be 3.4 per cent next year rising to just over 4 per cent in 2014 and 2015. The current account deficit of the balance of payments will average about 4 per cent of GDP. Consumer price inflation has increased over the past year, and is expected to stabilise at about 5½ per cent a year.

Within the global economy, the overall trend is a gradual but still inadequate convergence between living standards in rich and poor countries.  The gap is still very wide and individual country performance varies considerably.

But we have not yet seen convincing evidence of convergence within the South African economy: the income gap and the development gap are still very wide and employment growth has been too sluggish.

Also of concern is that the trends in expenditure and production are not taking us in the direction of faster, sustainable growth.

Household consumption spending has recovered strongly since the 2009 recession and household debt remains high, but private sector capital formation in 2011 is still well below its 2008 peak.

Government consumption has also increased steadily, but general government capital spending has declined for three years in a row.

Exports are still more than 15 per cent below their 2008 level in volume terms, whereas imports are near their all-time high.

South Africa has benefited from the boom in commodity prices over the past several years, but this has not led to significant growth in mining production. Energy constraints, inadequate transport capacity and uncertainty in the regulatory environment have held back progress. In contrast, mining production expanded by 30 per cent in Australia, and 44 per cent in Brazil between 2003 and 2010. This has provided a huge boost for investment, tax revenues, jobs and incomes in these countries. Minister Shabangu’s engagement with the Chamber of Mines on increasing investment in our mining resources is therefore to be welcomed.

In the manufacturing sector, rising domestic costs and weak external demand have held back the output recovery. Minister Davies is seeking common ground with leaders in industry on a strategy to revitalise manufacturing and provide appropriate support.

We recognize also that the volatility of the rand remains a difficulty for many businesses in the tradable goods sectors. The currency has traded in a range of R6.58 to R8.25 to the US dollar this year, with volatility clearly linked to global financial turmoil. The rand weakened by as much as 7.5 per cent against the US dollar in one day during September, before strengthening by 5.4 per cent on another. Depreciation in the rand in recent months has brought some relief to manufacturers, though it has also contributed to some upward pressure on prices.

Of particular importance is the trend in food prices. Minister Joemat-Peterson’s efforts to improve our agricultural trade position and support emerging farmers are critical not just for food security, but also because of the employment potential associated with farming activities. The expanding role of the Land Bank in supporting the farming sector will assist in growing our agriculture sector while contributing to job creation.

Mister Speaker, trends in the labour market indicate the magnitude of the economic challenge ahead. Real wage levels have increased in both the public and private sectors, but the pace of job creation has been far too slow. In the fifteen months to March 2010, 426 000 jobs were lost in the formal non-agricultural economy, and the estimated overall loss of jobs was more than double this. In the subsequent fifteen months of recovery to June this year, just 210 000 jobs were created, mainly in the public sector.

The quarterly employment survey records 8.3 million formal non-agricultural jobs. Several million people also earn uncertain incomes in agriculture or household employment, and in informal, seasonal and unrecorded activities. How do we bring these activities into the formal economy? How do we improve livelihoods in vulnerable and insecure activities, in which productivity is low though there may be potential for growth?

The recent recession has exposed similar concerns in many other countries. Everywhere in the world there is a struggle to boost job creation and to recognise and enhance the value of atypical forms of work. So we need to acknowledge Minister Oliphant’s difficult task in finding the right balance between protecting job security and adjustment to changing market opportunities. The agreement recently reached between the South African Clothing and Textile Workers’ Union and employers in this sector illustrates that dialogue is the way to make progress.

Countries deal with these issues in differing ways. We have to learn from international experience, and adapt these lessons to our circumstances.

Social security and health insurance reforms are important elements in building a better deal for vulnerable workers, providing protection against unemployment, illness or injury, and securing an adequate income in retirement.

Better city planning, investment in public transport and well-targeted financing of housing and residential development are also important elements in the social wage. These are activities that create work opportunities in themselves, but they also create better living conditions for working people and make it easier for the unemployed to search for jobs.

The central thrust of our economic policy challenge is to support competitiveness and promote the kinds of structural change that will lead to more rapid, inclusive growth. This means that we need a reserve of funds, and a capacity to direct these resources effectively. The MTBPS proposes a competiveness support package of R25 billion over the next six years to boost industrial development, assist enterprises and accelerate job creation. This initiative will build on several broader programmes:

Tax incentives for industrial investment, technology and training amounting to over R8 billion for  recently approved projects

Continuing investment in energy, water, transport and communications and infrastructure

Improved incentives for investment in industrial development zones, particularly where there is potential to participate in global supply chains and to develop competitive logistics hubs

Regulatory and administrative reform to facilitate small business development

Support for black business development, including preferential procurement and finance facilities

Encouragement of export diversification, including new trade partnerships with fast-growing emerging economies

Regional integration within sub-Saharan Africa, including investment in a north-south transport corridor and administrative reform of trade arrangements

Support for job creation, training and community works projects

Alignment of trade, investment and energy policies to support the transition to a green economy, including private sector participation in our renewable energy production programme.

Fiscal framework

The fiscal challenge over the next three years is complex. We must support job creation, maintain the value of the social wage and finance economic transformation outlined in the New Growth Path. Over the longer term we must realise a rising floor of social and economic rights. Achieving these objectives, Mister Speaker, requires us to work within a sustainable fiscal framework.

Since 2009, in response to the global crisis and the recession, we have pursued an accommodative fiscal stance. Revenue has fallen, but we have maintained real growth in expenditure, complementing the Reserve Bank’s support for the economy through lower interest rates and monetary easing.

Beginning in 2002, non-interest expenditure doubled in real terms in seven years and consolidated spending increased to 32 per cent of GDP. This spending growth was largely financed by increased revenue associated with economic expansion and improved tax compliance and administration. But the higher revenue also included a temporary windfall associated with high commodity prices. Revenue has now declined relative to GDP, and the budget deficit has widened.

For the first six months of the fiscal year, tax receipts grew by 7.1 which is significantly lower than was anticipated in the February Budget. The lag in consumption spending and high administered prices have particularly affected small and medium size businesses, contributing to lower VAT receipts.

SARS detected increases in VAT fraud and has introduced more stringent screening of VAT refunds which, to date, has led to the prevention of R4.2 billion of potential VAT fraud.

Although corporate income tax has not yet recovered to pre-recession levels, it has remained resilient despite the uncertain economic climate.

On the trade side, customs duties and import VAT have grown significantly year-on-year and to some extent offset the poor performance of domestic VAT. Enhancements in customs administration have resulted in faster processing of commercial traffic at border posts and have, in the main, attracted favourable responses from traders.

This year, we expect tax revenue to be R729 billion, which is R13 billion below the February budget estimate.

Next year government will spend over one trillion rands.

The result is that the deficit will be 5.5 per cent of GDP this year. For the period ahead, the deficit will decline to 5.2 per cent next year and 3.3 per cent by 2014/15.

The consolidated public sector borrowing requirement will be 8.1 per cent of GDP this year, falling to about 5 per cent of GDP in 2014/15.

Government debt will rise from 23 per cent of GDP in 2009 to about 40 per cent of GDP in 2015, which signals the very substantial contribution of the fiscus over this period to economic recovery and growth.

Budget deficits and continued rising debt erodes the space for fiscal and monetary policy responses to future downturns. For the next three years, the aim is to moderate spending growth, combined with a recovery in tax revenue, so that national debt will be stabilised as a percentage of GDP. This means that by 2014/15, we can begin to rebuild fiscal space, with a positive primary balance, or revenue broadly in line with non-interest spending. We must borrow to invest in infrastructure – not for government consumption.

We will once again create a “policy reserve” to finance the initiatives we propose in support of economic growth. Government as a whole has substantial financial investments, sometimes in surplus cash and sometimes in other assets. Where these resources could more productively be applied to other priorities, we will return surplus funds to the fiscus. Greater efficiency must also be sought in government cash management and in goods and services procurement, where ordinary disciplines of financial management have to be strengthened. Further steps will be taken to reduce administrative costs and unnecessary duplication of capacity. Departments will be obliged to identify and report on savings initiatives.  We will request the Auditor-General to strengthen his focus on value for money.

Long-term sustainability depends also on shifting the composition of government spending from consumption to investment.

Our aim is to strengthen infrastructure investment and maintenance, because this is a key contribution to the underlying growth potential of the economy. This means that we must see a moderation in the growth of the wage bill and spending on goods and services over the MTEF period ahead. We must do more with less.

Over the past three years, the public service wage bill has increased from 35 per cent to nearly 40 per cent of non-interest expenditure. The proposed framework for the 2012 Budget provides for more moderate cost-of-living adjustments for public sector employees than in recent years, to be implemented with effect from April each year.

All of us must share in creating a greater momentum for growth, jobs and investment.  As government we see the need for the same principle of moderation to be applied to ourselves as cabinet ministers and other political office bearers. This must also be extended to senior management in the public service and executives of state entities. It is vital that the private sector provides responsible leadership as well. Indeed, throughout the world we need to see a paradigm shift in this regard.

We want to assure our people that we will address inefficiency, extravagance and waste in public administration.  In the wider economy, the same principle applies – moderation in consumption means higher savings and stronger growth. 

Investment in infrastructure

We will do all of this and more, because we need to invest more in infrastructure that will help to stimulate our economy and increase job creation. 

In recent years, infrastructure spending by many national and provincial departments and municipalities has lagged behind budget allocations. Efforts to strengthen capacity to manage capital budgets and construction contracts are therefore necessary. The Development Bank of Southern Africa is providing support in this area, but we also need to see much greater responsibility and accountability in municipal councils and key infrastructure departments, state-owned companies and public entities.

Public sector infrastructure spending in the current year is estimated at R233 billion, or 7.8 per cent of GDP. Over the MTEF period ahead infrastructure plans amount to R802 billion. This is a very substantial investment programme, within which there is considerable opportunity for local construction and manufacturing development and job creation.

Investment in the energy sector amounts to R292 billion over the next three years

Transport and logistics account for R226 billion

Provision is made for hospital construction and other health facilities, amounting to R39 billion, and education infrastructure of R32 billion

Substantial funding will go to municipalities and provinces for housing, residential infrastructure and local economic development.

Much of this will be financed through debt. State-owned enterprises will borrow about R74 billion this year to finance investment spending, rising to just under R80 billion next year.

We need to appreciate that debt has to be repaid, either through the tariffs and charges that are dedicated to these services, or through higher taxes. It is important to find the right balance between cost recovery from users of services, and general tax-funding. But the cost of not expanding capacity, the cost of not maintaining and rehabilitating ageing infrastructure, is an even greater future burden of congested and dangerous networks, constrained production and economic decline.

Adjustments to the 2011/12 appropriations

Before turning to the medium term expenditure plans for the 2012 Budget, Mister Speaker, I need to explain briefly the adjustments proposed for this year’s allocations. These are set out in the Adjusted Estimates of National Expenditure.

Additional appropriations are proposed amounting to R10.3 billion. Almost half of this amount is required to fund higher-than-planned wage bills – R3.2 billion in the provinces and R1.2 billion in national departments. The costs of the 2011 wage settlement will also require savings and reprioritization in departmental administration and programme expenditures.

Members of the House will note that many departmental votes include shifts in funds between identified activities, known as virements. Reservations have been expressed in this House about these mid-year changes to allocations, and the extent to which departments are able to amend allocations that have been approved in law. Our aim is to bring greater reliability and consistency to the appropriations over time. However, it is not possible to predict expenditures with complete certainty, and so some scope for adjustment has to be accommodated within the budget rules.

On top of the additional allocations for wages, R3.8 billion of unspent money from last year is rolled over to this year.  This includes

more than R1 billion for infrastructure projects

almost R200 million for improving health facilities, and

R105 million for the COP 17 Climate Change Conference in Durban next month.

The adjustments also include provision for unforeseeable and unavoidable expenditure.

Almost R150 million will go to help farmers recover from the damage caused by flooding at the start of the year and the harm caused by livestock diseases.

R81.4 million is required by Minister Sisulu to fight piracy in the Mozambican channel in cooperation with the Mozambican defence force.

An amount of R266 million is proposed for once-off gratuities to be paid to outgoing councillors following this year’s municipal elections.

R208 million is allocated to meet urgent needs associated with acid mine damage in the Witwatersrand basin. I understand that progress has been made towards a partnership between the water authorities, municipalities and mines that will contribute to addressing the region’s water supply needs over the long term.

R752 million goes to provinces for various conditional grants, including allocations for the repair of flood-damaged infrastructure.

The overall impact of the adjustments is a decrease of R0.9 billion in the 2011/12 expenditure estimate. In brief, we are adding to our spending plans for higher wages and salaries, but we will see offsetting under-spending on investment and maintenance of infrastructure this year. This is a pattern that needs to be reversed in the period ahead.

Medium-term expenditure framework and division of revenue

I turn now to the proposed expenditure framework for the 2012 Budget, Mister Speaker. I need to compliment this House, and the chairs of portfolio committees and the appropriations committee, for the constructive advice set out in the first set of budget review and recommendation reports last year. Parliament’s attention to the details of public expenditure plans and their implementation, is critical for the success of our economic transformation and social development agenda.

The expenditure framework for the period ahead provides for real growth in spending of 2.3 per cent a year. Reprioritization and a concerted focus on efficiency and improved financial management mean that new expenditure priorities are mainly financed by savings within this expenditure envelope. A total of R48 billion is added to the spending allocations over the MTEF period, partly to accommodate the carrythrough costs of this year’s salary increases.

Chapter 4 of the MTBPS outlines the planned consolidated expenditure of national and provincial government and public entities, and summarises the division of revenue between national, provincial and local government. 

Let me highlight key features:

As a consequence of the wider budget deficit since 2008, state debt cost is the fastest growing category of spending, increasing to R115 billion in 2014/15, or just under 10 per cent of the total.

Transport infrastructure is the second fastest category, rising from R67 billion this year to over R90 billion in three years’ time. Minister Ndebele’s responsibilities include the first phase of the commuter rail rolling stock replacement programme, and continued investment in the construction and rehabilitation of national and provincial roads.

Public order and safety spending is set to increase by 7.4 per cent a year, with the main share going to the police vote under Minister Mthethwa.

The expanded public works programme continues to make progress towards a target of 3.4 million job opportunities over the next three years. The recently established community works programme will be expanded to about 250 000 participants by 2014/15.

Education remains the largest priority in government spending. It accounts for over 20 per cent of non-interest allocations, and will rise to R232 billion in 2014/15.

Health spending is set to increase by 7.4 per cent a year, from R113 billion this year to R140 billion in three years’ time. This includes the NHI pilot projects in ten districts focused on comprehensive primary health care.

Spending on local government, housing and community amenities will rise from R122 billion to R146 billion over the next three years, including targeted funding for upgrading informal settlements in 45 cities and towns.

Environmental protection and green economy initiatives will continue to be strengthened, including assistance to municipalities for electricity demand management programmes and private sector partnerships aimed at reducing greenhouse gas emissions.

Allocations for science and technology will increase by 9.5 per cent a year over the period ahead, with a special focus, under Minister Pandor’s guidance, on support for business innovation with potential for growth and employment creation.

Of the R48 billion available for allocation in the 2012 Budget, 42 per cent goes to provinces and 11 per cent to local government.  Personnel expenditure will take up part of the revised provincial shares, and allocations are also made for infrastructure repairs and rehabilitation and early childhood education programmes. Transfers to municipalities take into account service delivery backlogs that have to be addressed, and bulk infrastructure and waste management services.

Decisive steps need to be taken to address slow and inefficient spending on social and economic infrastructure by provinces and municipalities. The rules for infrastructure conditional transfers to provincial departments and municipalities will be adapted to improve planning, procurement and implementation procedures. The intention is to reward provincial departments and municipalities that accelerate implementation and that ensure efficient and cost effective delivery of services. These measures will be introduced from April 2012 and will be announced during the tabling of the budget next year.

To grow the economy and further accelerate access to basic services, greater infrastructure investment is needed by municipalities. The 2011 MTBPS signals a number of interventions in this regard.

First, funding is targeted at smaller predominantly rural municipalities to improve their institutions to deliver faster and quality services to their citizens. This should put them in a position to recruit and retain skilled municipal managers and financial management expertise.

Second, these municipalities will also be provided with greater national support. Depending on their circumstances and need, bulk infrastructure project implementation will be accelerated.

Third, our metropolitan and secondary cities are home to the urban poor who are accommodated in many instances in large informal settlements. Over R60 billion is to be spent in these cities and towns to transform informal settlements into fully integrated and dignified built environments. The spirit of enterprise is there, we need to collectively roll up our sleeves and face these challenges head on.

Fiscal reform and financial stability

Mister Speaker, our fiscal policy is built on the principles outlined in the 2011 Budget Review:

Counter-cyclicality – which means that changes in the budget balance work to offset the fluctuations in demand that create economic slowdowns and booms

Debt sustainability – increases in the stock of debt, incurred by financing deficits during slowdowns, will be offset by debt reduction in boom periods

Inter-generational equity – our children and their children should not be unfairly burdened by the future costs of commitments we make today.

Next year, the National Treasury will publish a long term outlook for the public finances, drawing on these principles, and taking into account South Africa’s demographic trends and economic challenges. It will explore the implications for government finance of major long term priorities, including improved infrastructure investment and maintenance, social security and retirement reform, the establishment of national health insurance, the role of development finance institutions and the strengthening of our municipal finances.

The main source of finance for the real growth of total expenditure will be, as always, tax revenues. I wish to pay tribute to the Commissioner Magashula and the South African Revenue Service team for their continued hard work and success in building payments compliance and securing the revenue stream.

Coordination of fiscal and monetary policy is also critical to macroeconomic management and our financial stability. Working together with Governor Gill Marcus and the South African Reserve Bank, we have begun the reform of financial regulation and risk management set out in the paper A Safer Financial System to Serve South Africa Better, published in February this year. Prudential regulation has been strengthened by establishing the Financial Stability Oversight Committee, chaired jointly by the Governor and myself. It aims to ensure that we maintain financial stability and deal effectively with systemic risks to the financial system. Progress has also been made in setting up the necessary technical support to implement the proposed separation of prudential regulation and consumer protection, which will take two to three years to implement.

We have also agreed on several reforms to improve South Africa’s position as a financial gateway into Africa and facilitate cross-border transactions. All inward-listed shares on the JSE will henceforth be classified as domestic assets and be included on the JSE indices, as agreed with the regulatory authorities. Steps will be taken to simplify procedures and reduce the cost of cross-border money remittances, particularly to neighbouring countries and the rest of Africa.

I am pleased to be able to assure the House that whilst some banks in advanced economies now appear to be undercapitalised, our own banks and financial markets are in robust condition. Our regulatory and oversight systems have stood the test of time, ensuring that our financial sector has remained steady in these troubled times. To take forward this work, I am pleased to welcome the new Banking Registrar, Mr Rene van Wyk, who will build on the firm foundations laid by his predecessor Mr Errol Kruger.

Conclusion

Mister Speaker, on previous occasions I have stated that we must target economic growth of 7 per cent per year sustained for a generation or longer. At this pace the economy would double in size every ten years, delivering jobs and prosperity and lifting millions out of poverty. For us as a nation to achieve this ambition requires deep rooted transformation of our economy that removes the many barriers to growth and development.

Microeconomic reforms are at the heart of undertaking structural change, increasing productivity and improving competiveness. Central to these efforts are interventions that systematically raise the level of competition across industries and sectors, provide efficient and cost-effective energy, transport, ICT, and logistics networks, encourage innovation, foster entrepreneurship and enterprise development, and provide the platform for closer regional economic integration. Within government our reform efforts must provide value for money, improving the efficiency with which we build social and economic infrastructure and the delivery of high-quality public services particularly in health and education.

Minister Motsoaledi’s insistence, for example, on achieving lower costs in our anti-retroviral procurement, and better management of medicines and other supplies in our hospitals and clinics, represents savings of billions of rand over time. Minister Motshekga’s cost-savings through centralized publication and distribution of workbooks to schools is another excellent example. Minister Dlamini-Zuma has led an impressive administrative turnaround in the Department of Home Affairs.

I am also pleased to be able to report that the Jobs Fund, launched on the 7th June 2011, received a total of 2 651 applications following its first call for proposals, illustrating the demand, innovation and desire across both the private and public sectors to create jobs. The applications were spread across each of the four funding windows – enterprise development, support for work seekers, infrastructure investment, and building institutional capacity. The Investment Committee has commenced the approval of projects with a total grant allocation of R352 million and 115 226 projected jobs.

Mister Speaker, we owe it to our young people to take these reforms forward, both within government and in building our wider economy.

This week, the matric examinations begin for another cohort of school-leavers. I know that the House will join me in wishing them everything of the best.

In a few weeks’ time, Minister Nkoana-Mashabane will seek to make progress in a most difficult global coordination challenge: how to invest in a clean-energy future, and how to share the costs of this transition. In wishing her well as chair of the 17th Conference of the Parties we can also take pride in the contribution of the South African scientific community to understanding climate change and its implications. We also wish Minister Molewa well in leading South Africa’s delegation to the conference.

Honourable Speaker, allow me to express my appreciation to President Zuma for his wise leadership, and to Deputy President Motlanthe for valued guidance.  I am grateful for the support of the Ministers Committee on the Budget, members of the Treasury Committee, Cabinet colleagues, Premiers and provincial finance MECs, during a year of a period of financial challenges.

I would also like to commend Mr Thaba Mufamadi, Mr Mshiyeni Sogoni, and Mr Charel de Beer and Mr Teboho Chaane, who chair the standing committees on finance and appropriations, and the select committee on finance. 

We are grateful to the Governor of the South African Reserve Bank, Ms Gill Marcus and her team at SARB for their steadfast management of monetary policy at a challenging time.

I know that the House will join me in expressing our admiration and thanks to the Auditor-General, Terence Nombembe, and his staff, for their rigorous scrutiny of the public finances.

Thanks are due to Mr Oupa Magashula and the staff of South African Revenue Service for taking the “Eish out of taxation” and their valiant efforts to give us the revenue we need.

I would like to thank Deputy Minister Nhlanhla Nene for his tireless support and sharing our burden.  The National Treasury team have again delivered a set of budget statements during a dynamic and uncertain time when innovation, dedication and hard work, more so than usual, is required.  I would like to congratulate the new Director-General, Lungisa Fuzile on his appointment and thank him for his leadership and tireless efforts in steering his first MTBPS. 

Mr Speaker, we live in challenging and uncertain times.  There, are, however, many opportunities for us to advance to our goal for a better life for all in South Africa.  This is a time for united action, for greater urgency, and for an unconditional focus on those programmes which will demonstrate to our people that we care and that we will change their lives for the better.

Honourable Speaker, I hereby submit the Medium Term Budget Policy Statement 2011, and I table the Adjusted Estimates of National Expenditure, the Adjustments Appropriation Bill 2011, the Division of Revenue Amendment Bill 2011, the Taxation Laws Amendment Bill, and the Taxation Laws Second Amendment Bill for consideration by Parliament.  

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