Zuma’s 6m jobs a pipe dream, unless ...

2014-02-12 10:19

President Jacob Zuma’s pledge to create 6 million job opportunities within the next five years will not be realised unless the government raises the levels of service delivery and creates a conducive environment for private business to create jobs, economist Mike Schussler has warned.

Speaking at the Institute of Internal Auditors SA’s public sector forum in Ekurhuleni yesterday, Schussler told auditors that the economic forecast for the country will become bleaker as more downgrades to the country’s credit rating were expected from international agencies.

Despite concerted efforts by Finance Minister Pravin Gordhan to keep the country’s debt:gross domestic product (GDP) ratio at 40%, Schussler said it will become increasingly impossible to keep the ratio at 40%, which would lower the country’s credit rating and affect job creation.

Schussler told auditors that they were in the driving seat and had to ensure that the country delivered services by being vigilant about how local, provincial and national government departments spent taxpayers’ money.

With only 10% of the country’s population paying taxes into the coffers, auditors were vital in ensuring that the poorest of the poor received basic services.

“You have a responsibility as auditors in the public sector to look after the other 90% who are poor or unemployed,” said Schussler.

He had sympathy for Gordhan because the minister had the unenviable task of ensuring a conducive environment for the private sector to create jobs. Ever more people are unable to keep up with their bills, and ratepayers owed R85 billion to municipalities.

“I feel for the minister of finance. He’s no longer walking on a tightrope that has snapped. He is hanging on a piece of string and you guys are part of that piece of string,” said Schussler.

He said proposals currently doing the rounds that would halt salary increases for anyone earning more than R35 000 a month were gaining traction because “times are tough”.

“The government is the major employer. If you add state-owned enterprises, 25% of formal employment is in government. That means that one in four adults in formal employment work in government when we only have four out of 10 people working.”

Schussler appealed to civil servants not to demand high salaries because South Africa spent 13% of the country’s GDP on salaries, which was not sustainable with increased wage demands from the public sector.

“If you work in the civil service, you’re not poor by any measure. It might be shocking to you, but this is true and this gives us the right as taxpayers to say to you guys, do not misspend our money. Deliver the service. Make sure the service is delivered and that we’re paying you. Make sure the teachers are on time and hospital staff is there because we cannot be the top five country in this [salaries paid to civil servants per GDP].

“That makes you [civil servants] a very important cog in this whole scenario. Don’t go running around asking for more money because there isn’t any,” he said.

“But go running around ensuring that the audits you do are giving honest assessments and perhaps answer the question whether we are delivering, are we getting bang for our buck?” Schussler said.

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