Is a decent life enough?

2014-04-10 10:00

As the term of the National Planning Commission draws to a close, Bridgette Gasa, Mike Muller and Karl von Holdt argue economic transformation must be the focus of engagement among government, business, labour and the wider community.

The National Development Plan (NDP) states that South Africa must move away decisively from the extractive and exploitative apartheid economy; that the new economy must be fairer and support a more inclusive, participative and cohesive society.

It sounds good, but is this what people really mean by economic transformation?

If so, why have the plan’s economic proposals been qualified or rejected by labour federation Cosatu, the National Union of Metal Workers of SA and other role players?

One reason may be that the plan tried to cover four separate, albeit related, areas:

.?The structure of the economy and its governance;

.?Ownership and control of economic assets;

.?The distribution of income and wealth, and access to public goods; and

.?Access to opportunities in jobs and businesses.

But it concentrates on the basics needed for a “decent life”?–?jobs and public goods like education, health and other services that directly help to eliminate poverty and reverse inequality.

Ownership and the distribution of wealth receive less attention.

Critics ask if poor people must wait for a generation before their lives improve while few demands are made on the private sector and richer members of society.

Economic growth offers opportunities, but it will not necessarily overcome inequality or change ownership and control unless the black majority gets the lion’s share.

If opportunities are simply captured by the old elite?–?or monopolised by new ones?– transformation will have failed and tensions will escalate.

While much has been achieved since 1994, with growth rates consistently higher than in apartheid’s final decade, the fruits appear to have been disproportionately captured by the elite, leaving poverty and inequality deeply entrenched.

This poses huge challenges.

The NDP makes far-reaching proposals for transformative infrastructure programmes, changing spatial structures, accelerating land reform, improving health and education, and enhancing state capabilities?– and government is already beginning to implement several of these.

But are these initiatives enough?

Historically, mining produced an unequal and exploitative society based on migrant labour and racial segregation.

But its profits also financed industrial development, infrastructure and agricultural expansion.

The NDP says we must continue to exploit global demand for our rich minerals to boost our economy and society.

But how? Through a competitive mining equipment industry and beneficiation? What about environmental and social costs?

How can mining profits be translated into public benefits that also reach communities living in squalor around the mines?

Some argue for nationalisation, while others argue for giving the state a stake in mining operations or simply taxing superprofits.

Government is reinforcing traditional authority in the former Bantustan areas through various laws despite the NDP’s call to extend constitutional democracy and democratic land tenure systems to those areas.

Black economic empowerment is an NDP priority since existing efforts are not achieving their objectives and emerging firms must be enabled to grow.

The challenge is to build more independent, production-oriented, black businesses rather than the current, often dependent, relationships with old white capital. We need to do this while recognising the constraints imposed by the complex global economy.

Concrete, visible action that acknowledges the “historical debt” owed for apartheid’s violence and dispossession will contribute to economic transformation.

We need catalytic interventions that will change the way we think and work together, and the way the economy runs.

Business protests that it is ready to move, but needs clear direction and frameworks in which to work.

However, robust public strategies promoting cheap generic medicines, identifying minerals with strategic importance or proposing state involvement in natural gas have been vocally opposed by the business sector.

Yet the private sector could contribute far more through greater long-term investment of its alleged trillion-rand cash pile, more balanced remuneration, practical commitment to real redress in land ownership and business ventures, targeted taxation and royalties to help build healthy communities around mining developments.

These and other challenges are not just technical issues.

They reflect power imbalances in society that affect the distribution of opportunities and wealth.

Those with power seldom relinquish it voluntarily, but they may share it if they understand that to be in their long-term interests.

How about investing in longer-term development programmes of the Industrial Development Corporation and the Development Bank of Southern Africa?

Or agreements in mining that allow us to benefit from our natural endowments?

How can we use our minerals to reduce high local prices for steel?

If the private sector has no answers, it should support public sector interventions.

But it is not just private business that needs to come to the party.

Better-off communities could support the NDP by embracing town planning and housing interventions that enable poorer people to live closer to work and opportunities.

The rural reform programmes being tested in Mpumalanga where commercial farmers have volunteered to give land to new farmers and help them use it productively, could build trust between historically divided communities.

Our schools must be fixed together with the people who work in them.

Already, some quiet pilot partnerships, which include organised teachers, are making significant progress.

These tough challenges of transformation cannot be addressed by one group alone.

But the current wave of industrial strikes, community protests and increasing levels of political violence should only strengthen our resolve to commit to transformation and broad social development, and identify what has to be done and agree on who will do it.

So we need to provoke discussions about the issues and options across the land and see practical action by active citizens and organisations.

We cannot just wait for government to act. No plan will succeed unless it is owned by the people who must implement it.

That is the challenge for the next phase of South Africa’s national development planning.

As outgoing commissioners, the most important contribution we can make in our final year is to get that conversation going, and to unlock the energies and abilities that are South Africa’s real treasures.

Gasa, Muller and Von Holdt are NDP commissioners

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