Jeremy Cronin, the deputy general secretary of the South African Communist Party, suggested in Parliament on Tuesday that there should be a council of state, which would be a super-cabinet with a strategic planning mandate.
As he sees it, the council — which, he said, exists in a number of developing countries — would have key ministers with overarching responsibilities such as infrastructure, energy, human resources, social development, public safety, trade, industrial policy, foreign affairs ”and, of course, the Treasury”.
Speaking during debate on the Appropriation Bill — which gives effect to Trevor Manuel’s tax proposals made in his Budget last month — Cronin added that more regular line departments would then form a second, implementing tier.
”In this way, surely, we could ensure much better alignment of, for instance, our human resource, infrastructure, energy and industrial policy objectives,” he told MPs.
Cronin said he is anxious to solve the problem of how South Africa aligns its infrastructure investments with its industrial policy objectives.
He said that MPs have to ask these kinds of questions. ”We would be failing in our duty if we did not ask for greater clarification on why — given our electricity generation crisis — Cabinet appears to be committed to another energy-guzzling aluminium smelter at Coega,” he said. ”Perhaps there are sound reasons, but we certainly need to ask.”
Fiscal discipline
He broached the subject of fiscal discipline, saying there are concerted and persistent attempts to frighten the government’s economic policies into the narrow confines of maintaining the confidence of the markets.
”Fiscal discipline, fiscal discipline, fiscal discipline is the theme song,” he told the National Assembly. ”They want the minister of finance to proclaim himself in favour of fiscal discipline, as he must, of course, as if this were a rejection of ANC [African National Congress] policy.
”And they want the rest of us to hoist the banner of fiscal indiscipline, imagining that we were somehow proving our ‘left’ or ‘Polokwane’ credentials in so doing.”
He told the House: ”Rather than getting trapped into a false debate, let us agree that indeed we need fiscal realism, less for the narrow and exclusive purposes of reassuring the whims of market sentiment, and more for the critical purpose of freeing ourselves from those whims and broadening our sovereign capacity to debate and decide upon economic policy.
”That is the consensus that informs the ANC’s national conference economic resolutions, and that is the consensus that informs the present budget,” he said.
He said that this is nowhere more apparent than in the sustained, state-led infrastructure investment, which is consolidated and accelerated in this budget. Increasingly robust government-led spending on infrastructure is the key factor in sustaining growth in a turbulent global context.
In this budget, a total of R17-billion was added to the budgets of the departments of housing, provincial and local government, water affairs, sports and recreation and transport over the next three years. Most of this was for infrastructure.
”All of these initiatives, and others like them, are to be welcomed. As the ANC we lend our full support,” he said. ”However, we would be failing in our responsibilities as the ANC parliamentary caucus if we simply left matters there, basking in a justifiable sense of satisfaction and pride in this infrastructure spend that has been — and will continue to be — the key catalyst of growth and job creation. We need also to ask some probing questions.”
‘Pet fancy’
He added that at present — ”and I might be wrong” — too many of South Africa’s major infrastructure projects give the impression of being a particular province or line department’s pet fancy, if not vanity project, with insufficient integration into a developmental and transformational strategic agenda.
He gave as an illustration the Gautrain project. ”In the first place, if my information and understanding is right, quietly and below the radar screen, its construction costs are now escalating towards the R35-billion mark — up from the already exorbitant R20-billion that we were told, hand on heart, here in Parliament, just a few years ago, was the written-in-stone, absolute upper limit.”
But, he said, that is not the key issue. Big projects like the Gautrain create thousands of jobs — at least during the construction phase — and contribute to the Gauteng, and therefore national, GDP.
”And, yes, strategically smart infrastructure programmes can catalyse many other things, but ill-conceived ones might have the opposite impact.
”They might crowd out and undermine other possibilities by drawing off scarce engineering, artisanal and project management skills from government departments, parastatals, municipalities; by driving up the prices of cement and steel and even threatening the availability of these key inputs.”
They might do the same by making inappropriate technical choices — for example, in the case of the Gautrain, the train sets and electrical components are all being largely imported, and because it is a stand-alone and one-off system, it means that there will be little medium-term and longer-term manufacturing spin-offs for future transport projects. — I-Net Bridge