The announcement that Cabinet is considering a basic income grant should be welcomed, writes Mark Rountree.
South Africa’s democratic governments have provided grants for children, the elderly and disabled. Although this social support network is something we can be proud of, millions of citizens remain unemployed and unsupported.
No just society should allow its people to starve.
The announcement by Social Development Minister Lindiwe Zulu that Cabinet is considering a basic income grant is a welcome, if decades overdue, move by the South African government.
However, the funding to underpin the proposal needs to be found.
During the Zuma administration, “free” higher education was made possible by cutting the budgets for schools, housing, home electrification and city infrastructure. Such budget juggling doesn’t offer a sustainable approach to improving the lives of all. The government should not steal from the future to pay for the present.
Some Cabinet members, like Patricia de Lille, have been calling for a basic income grant for decades.
In February last year, De Lille, the leader of GOOD, said “a government that is committed to eliminating rampant theft and corruption is capable of implementing a basic income grant, incrementally.”
She noted that such a grant, necessary “to alleviate the social and economic trauma of rampant unemployment and inhumane hunger” could be funded from savings made through eliminating corruption.
Bringing the money back into the budget that has been lost to corruption is a huge source of income.
President Cyril Ramaphosa said that R500 billion was lost to corruption during the decade of the Zuma administration and analysts estimate that an additional R1-1.5 trillion in tax revenues and foreign investment were lost in addition to the direct costs of corruption.
This is at least R25 000 stolen from each South African citizen – easily enough to fund a small monthly grant for unemployed people.
Will we get this money back from Dubai? Who knows.
Definitely some, but definitely not fast.
In the meantime, people are starving and the global economy is in a freefall.
We need society, the unions and political parties across all spectrums to unite for the common good of all citizens.
Leaders must balance the needs of the many against the privileges of the few. That means taking a close look at budget allocations across all levels of government – including the salaries and perks of employees and cadres deployed to State Owned Enterprises (SOEs).
Politicians and political parties also need to be ready to slice their own incomes.
It seems obvious, but who is doing it?
Smaller governments
We need smaller, not bigger, governments, but none of the large parties are supporting that.
The DA in the Western Cape is proposing to increase the size of the provincial government by more than 40%. It is, quite frankly, insane – even without the Covid-19 pandemic.
Brett Herron, GOOD’s representative in the Western Cape legislature, opposed the proposal, even though our party would benefit most from the increase.
“It is ludicrous to even consider increasing the budget for politicians when hundreds of thousands still await housing. Asking for more salaries for politicians when we cannot even employ enough teachers is immoral and simply cruel,” he said.
Unfortunately for taxpayers, the DA’s proposal has received support from the EFF and is under consideration by the ANC.
Less allocation for salary bills
Each year, hundreds of billions of taxpayers’ money is spent by our metros and municipalities and a huge chunk of that goes to salaries and perks for staff and local politicians.
The salary bills for government need to come down and local councillors have a key role to play.
Councillors determine the municipal salary bill through the budget they approve. The budget dictates the number of senior managers and the size of the administration.
This year, the DA opposed ANC-led Durban’s R1.1 billion wage increase, a 6.5% increase for senior officials and a 4% increase for councillors, but approved DA-led Cape Town’s R1.4 billion increase for salaries, including increases of 30 to 50% for senior officials, and approved a 5.5% increase for councillors.
Such hollow posturing – opposition for the sake of opposition – does not help anyone.
We need leaders to advance principles; to act with integrity and do what is right and good.
Less spending on SOEs
Hundreds of billions of rands have also been sunk into South Africa’s SOEs, but it is increasingly difficult to see what benefit the public gets from these investments.
The World Bank has highlighted SOE governance problems and advocated for reform and improved transparency. Other experts recommend some SOEs be closed.
At least one member of government is listening.
For years, the Auditor-General, Kimi Makwetu, has highlighted his concerns over the Independent Development Trust (IDT).
Makwetu said that supply chain management legislation and regulations were being flouted; no effective steps were taken to prevent tens of millions lost through irregular expenditure; and investigations into alleged financial misconduct or disciplinary steps against officials implicated were not being undertaken.
After years of ignoring the Auditor-General’s reports, this SOE is now being dissolved.
When the IDT board approached their new minister, Patricia de Lille, requesting additional budget, she said she found it difficult to justify any further bailouts and instructed them to dissolve before the end of the year. This should see hundreds of millions of rands being saved.
These problems are not isolated.
The funding and salaries in nationally-funded SOEs – like Eskom, SABC, Prasa and SAA – are well documented. But even in small SOEs, like Wesgro, state employees can earn more than the president.
With more than 700 SOEs operating, this means that there is plenty of room for large savings to be found.
While any job losses are highly undesirable, the Covid-19 pandemic has reduced overall government income and vastly accelerated the need for a major revision of spending priorities.
Savings from salary freezes or cuts, a smaller government, and reduced allocations to SOEs will allow more budget to be allocated for higher priority areas – like making sure unemployed citizens do not starve.
– Mark Rountree is the National Policy Officer for GOOD.
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