Billions to drum up jobs

2014-02-27 00:00

THE government has proposed a range of new measures to stimulate job creation in the Budget.

Finance Minister Pravin Gordhan said yesterday he supported President Jacob Zuma’s view that it is the private sector that must create new jobs. South Africa has one of the highest unemployment rates in the world at around 25%, and most are young people.

The government will expand its employment programmes over the next three years, Gordhan said.

Government projects to accelerate employment include the acceleration of public infrastructure investment, new spatial plans for cities, improved public transport and the upgrading of informal settlements.

There are R3,6 billion of new support measures for special economic zones — areas where manufactured goods exporters receive special benefits — a tax incentive to encourage youth employment that had already attracted 56 000 beneficiaries in its first month, while the further expansion of public works programmes is planned.

Other government measures to help create new jobs include a renewed focus on accountability and quality in education, the phasing in of National Health Insurance, further investment in renewable energy and steps to professionalise the public service.

Gordhan said the government has spent more than R100 billion on employment programmes over the past five years, including municipal and provincial spending, and more than four million job opportunities were funded over this time.

Some R19,4 billion will be allocated to the National Student Financial Aid Scheme over three years, to assist over 500 000 students a year to get through university, and the figure will boost the R115 billion already spent on higher education over five years.

Spending on infrastructure — one of the major drivers of government-funded job opportunities — will amount to R847 billion over the next three years, this following R1 trillion already spent.

Spending on industrial incentives is expected to amount to R21,8 billion over three years.

A total of 128 projects have been approved under the Automotive Investment Scheme and more than 460 companies have benefited from the Clothing and Textiles Competitiveness Programme.

Gordhan said a community work programme will be implemented in every municipality by 2017 in the effort to expand the public works programme.

In addition, billions of rands would be allocated to support the small and medium enterprise sector, and the Jobs Fund partnerships with private and public sector development agencies.

To support those who lose their jobs in difficult times, the Labour Department proposed to extend unemployment benefits to 365 days from 238 days, on condition that the claimants are actively seeking work.

Some R10,8 billion will be spent on incentives to develop the manufacturing sector, and R15,2 billion is available for machinery and productivity-related upgrades.

The government is also developing an agriculture policy action plan to support the National Development Plan’s target of creating one million jobs in the 2014 Budget speech.

Over R7 billion will be spent on conditional grants to provinces to support about 435 000 subsistence and 54 500 smallholder farmers and to improve extension services in rural


In support of the digital broadcast migration programme, R620 million will be allocated from funds to be surrendered to the National Revenue Fund, by Sentech.

The regulatory burden of small businesses is being eased through the lowering of the turnover tax regime, a graduated tax structure for small businesses and amendments to the venture capital tax regime.

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