Expedience a threat to JZ’s bounty

2011-02-12 09:01

You could say that President Jacob Zuma’s annual state of the nation address was like a shopping list with a section called “What we’ve done” and the second half “What is still to be done”.

In that sense, it lacked his characteristic mshini. But it’s quite a list, if you consider the liberal use of billions of rands to show his good intentions: in an era of public service cuts and massive budget deficits, it was a dream address.

And we like that Zuma’s team concentrated on the people who matter most: the jobless.

The employment numbers out this week reveal a picture of need that is growing like the queues at the UIF offices.

There are well over two million South Africans who are tired of looking for work – a mass of discouraged people who are on the brink. We tip the unemployment scales, measuring in at the higher end.

So, it’s good that Zuma played a flush hand on Thursday in his state of the nation address, promising more than R30?billion in tax cuts and job funds.

It can only be good news that will help us outgun a future as a welfare state.

The money is not insubstantial – the tax breaks are generous and the employment fund is proof of a government putting its money where its mouth is.
But for these to work, government must walk its talk and ensure that it does not end up shooting itself in the foot.

In so many ways, our policies and political position can work against each other.

Here are the bullets we must avoid: for one, government cannot offer massive tax breaks of R20?billion for new projects, expansions and upgrades while the governing party has nationalisation on the policy agenda.

Mining and other investors will run 1 000 miles in the opposite direction, as Anglo-American’s Cynthia Carroll said this week.

The only reason that ANC secretary-general Gwede Mantashe was forced to contradict mining minister Susan Shabangu this week was to keep the ANC Youth League on side – a position of expedience that could make 2011 The Year of Expedience rather than the Year of Job Creation that Zuma hopes for.

Previous subsidies offered as tax breaks have not featured the rate of take-up expected, suggesting that government needs to pay attention to disincentives in other parts of the economy.

While we support the need to grow the manufacturing sector, it will not happen while there is a slate of tough labour laws on the drawing board. We do not advocate a slave labour economy, but the regulatory impact of the employment laws add to the cost of job creation.

They are a sop to Cosatu, another example of expedience, and do not necessarily represent the interests of new workers or the businesses who may want to employ them.

As we have done this week, we will be keeping a chary eye on the billions to ensure that they are spent efficiently and quickly.

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