Deputy President Jacob Zuma said on Saturday that government was planning to increase its expenditure by about 4,7% for the next three years without endangering fiscal stability.
Zuma was speaking at an African National Congress (ANC) fund-raising dinner in Rustenburg in the North West.
”With government finances now sufficiently under control, we can begin to think more innovatively. One of the main areas of increased economic expenditure is in economic infrastructure, including local economic development handled in partnership with municipal governments.”
Zuma said it was envisaged that local government grants would allow 12% per year.
Another area of significantly expenditure would be health services, where expenditure would go up by about 11% per year for the three-year period.
”We will also focus on the integrated justice system, police, prisons and courts where expenditure will increase by about 9,4% per year.
”The recovery on the rand will help significantly in reducing the rate of inflation caused by the sudden depreciation of the currency in the latter half of 2001, and the high commodity prices.
”Ladies and gentlemen, a key issue on which we all need to work on in earnest this year is job creation. We are moving into the second phase of our economic reform process, namely that of growth and employment recreation. Our reconstructed economy now requires different skills than those required by the old economic structure.”
The deputy president said the problem was therefore one of structural unemployment, meaning that certain skills that were abundantly available in the country were no longer required by the new economy.
”The other major problem is that our economy has not been growing at high levels that would generate enough jobs for all new entrants. We need to deal with the problem of the abundant skills that are presently not used by our economy and at the same time address the challenge of a complete lack of skills to a larger percentage of the poor. This certainly calls for a diversified economy that is able to absorb this kind of the labour force in our country,” Zuma added. – Sapa