President Thabo Mbeki takes to the podium on Friday as a paradox: he is at both the strongest and the weakest moments of his term of office.
On the economic front, he is soaring like an eagle. Mbeki is one of few presidents in the world who can boast 78 straight months of growth, matched by declining inflation and a budget deficit at record lows. This week, the JSE, riding the coat-tails of a commodities boom, broke through its own ceilings to hit new records.
At the same time, Mbeki is politically weaker than he has ever been, facing both a grassroots rebellion and a leadership split in his ruling African National Congress.
More than 200 ANC members, in open defiance of Mbeki’s centralist management style, have registered as independents for the March 1 local poll. Last year, the government counted more than 800 street protests in overwhelmingly ANC strongholds.
Last year too, Mbeki failed to push through labour market and other reforms at the party’s national general council and was forced to climb down from his intended outcome for axed deputy Jacob Zuma. While Mbeki hoped to exclude Zuma from all party political work as he faced a corruption trial, a grassroots rebellion pushed him on to the back foot. He looked very much the lame duck.
Today, Mbeki will bank on the economic feel-good factor to tough out his speech. The key themes will be Deputy President Phumzile Mlambo-Ngcuka’s Accelerated Shared Growth Initiative (Asgi) and local government capacity. He is also likely to finally unveil details of his plans for the “structure of government” … a package of measures to improve the working of the state.
Control from the centre is a management formula Mbeki believes in, and he plans to propel a project he started in 2003 — the reconfiguration of South Africa’s model of government (isolated ministries and three vertical tiers: national, provincial and local government) into a seamless and goal-orientated public administration.
“The macro-organisation of the state and improving monitoring and evaluation, as contained in the programme of action” are likely to be emphasised, said Richard Levin, director general in Department of Public Service and Administration.
Mbeki’s Programme of Action, which he first announced in 2003, has been the centrepiece of his last two speeches and is his blueprint for delivery.
A tranche of the programme, dedicated to the “macro- organisation of the state”, includes details such as plans to review the Public Service Act, the Public Finance Management Act and the introduction of the Local Government: Municipal Employment Bill to legalise the deployment of senior managers and officials across the three tiers of government.
The programme of action has introduced business efficiency into the government and enables the public to hold the executive to account by means of numerical targets. For example, a sample of promises made by Mbeki in his speech last year shows that only about 50% have been achieved [see box].
Yet Mbeki is likely to continue on this structured path. When goals are not achieved, the time-frames will be readjusted.
The objectives in the programme of action are divided according to the government clusters: economic; governance and administration, international relations; justice and social. The presidency appears 60 times as the overseeing department, only second to the Department of Trade and Industry, which appears 80 times.
At the heart of Friday’s address will be the announcement of a R370-billion boost in infrastructure expenditure in the medium term in a bid to achieve 6% economic growth in the next five years, as part of Asgi.
This cash injection will increase public sector capital investment as a percentage of gross domestic product from 5,2% last year to 6,7% annually for the next three years.
At least 50% of this allocation has been earmarked to bolster capital investment in the three spheres of government, an initiative that is sorely needed given the flood of service delivery protests at local government level.
At the launch of the ANC’s local government manifesto on January 8, Mbeki restated the programme of action’s pledge that, “by 2010 when South Africa hosts the Soccer World Cup all households will have access to clean running water and sanitation, and when the ANC celebrates its centenary in 2012 every house will have access to electricity.”
David Hemson, director of Integrated Urban and Rural Development at the Human Sciences Research Council, says that these figures fail to take into account the increasing number of households. Based on his projections, the number of households will rise annually from 388 606 in 1997 to a projected 616 812 in 2008.
This will mean that in 2008 there will be a backlog of 2,1-million households without access to water.
Beyond delivery targets, Mbeki needs to address the exorbitant salaries of councillors, which on average consume as much as 54% of council budgets.
Levin said there was “a massive review of personnel expenditure under review” with the purpose of incorporating local government into the legal parameters of provincial and national government.
On the economic front, Mbeki will continue to focus on reducing the cost of doing business in South Africa, review import parity pricing, and implement a regulatory impact assessment of all legislation, including labour laws.
The government’s efforts to address the country’s skills dearth is moving at snail’s pace. Restructuring the Skills, Education and Training Authorities according to a review conducted in 2004, has taken more than a year and is still incomplete.
A focused employment strategy has become imperative, as unemployment has increased from 26,2% to 26,7% over the past year, according to Stats SA.
Real job creation will come with growth, and that depends on the series of interlocking programmes and policies to be announced under the Asgi.
While South Africa Inc is booming … the economy is in its 77th month of a record upturn (the previous record was in 1961) with at least a 5% economic growth rate — the pulse of socio-economic development is barely perceptible. The number of households surviving on a poverty line of R12 a day has risen 2% since 1995, according to a University of Cape Town report.
Mbeki has embedded his image as a manager, less so as a leader, and 2006 will mark a tipping point in his career. To keep strong, he must make tangible and meaningful progress on his programme of action.
Report card
FULFILLED:
- Second Network Operator awarded license in December last year
- Black Economic Empowerment Council appointed.
- Agricultural credit scheme established
- Schools register of needs updated
- R220-million dedicated to improving commuter transport and safety.
SOME PROGRESS:
- Aligning the National Spatial Development
Perspective with the Provincial Growth and
Development Strategies and the Municipal Integrated Development Plans
- Construction of new oil pipeline between Durban and Cape Town been approved. Environmental Impact Assessment studies underway.
- Implementing an Administered Price Index.
- Rehabilitating two mothballed power stations
UNFULFILLED: [FAILED]
- Transnet investments in the Durban and Cape Town harbours stalled.
- National Social Security Agency still hasn’t been launched (due date April 2005)
- Financial Sector Charter commitment to invest 5% of investible capital of financial institutions in productive activity stalled because of reluctance
from business.
- Sector development strategies in key sectors identified by government last year: community
and social services, wood and paper, appliances and retail haven’t happened.
- The implemetation of a government wide monitoring and evaluation system including an electronic information management system
hasn’t happened.
- A Pledge to expand the number of police areas for focussed multidisciplinary interventions from 63 to 169 hasn’t happened.
- Plans to operationalise more sexual offences courts, “taking into account that the conviction rate in these courts, (at 62%), is much higher than in ordinary courts (at 42%)”, has floundered as government is quietly doing away with specialised courts.