Programme Director
Honourable Acting Premier Mr Phumulo Masualle
National Ministers
Members of the Provincial executive Council
Members of the National and Provincial Planning Commissions
Ladies and Gentlemen
I am grateful for this opportunity to be part of this gathering to share perspectives on the implementation of the National Development Plan. Permit me to remind us of the journey of the National Development Plan. The National Planning Commission spent the first 12 months of its life assessing the nature and extent of the challenge we face and produced a diagnostic report in June 2011.
Thereafter we consulted our people to test whether they agreed with our findings. They agreed with us and suggested the inclusion of community safety, rural development, social protection, and the position of South Africa in the world. Six months later we produced a draft plan based on the findings of the diagnostic report and of public consultation. After that, we undertook further consultation and produced the National Development Plan.
It is important that we do not underappreciate the responses that we received over two years of consultation. The Plan was also endorsed by all major political parties – including the ruling party – and approved by the Extended Cabinet. It enjoys the support of most South Africans.
This broad support for the plan was echoed in President Zuma’s State of the Nation Address on 14 February 2013, in which he referred to the National Development Plan as follows: “It is a roadmap to a South Africa where all will have water, electricity, sanitation, jobs, housing, public transport, adequate nutrition, education, social protection, quality healthcare, recreation and a clean environment.”
The image of a roadmap is, actually, quite powerful. At the best of times, roads are built on the basis of planning, deep thinking, thorough research and precision construction (implementation). When we, as drivers, travel on our journeys we usually make our decisions on the basis of thorough planning. What is required of us is to stay on the road and follow the path that we have selected with the drive and commitment to reach our destination. We don’t always take the fastest or the safest route, and we can’t account for what other people do on the road but invariably, if we remain steadfast in our commitments and responsible in our actions, we will reach our destination.
The National Development Plan is South Africa’s roadmap; it is our passage to a prosperous and stable future for us and for the generations that follow. In his Budget Speech, the Minister of Finance affirmed the centrality of the National Development Plan to all government efforts to eliminate poverty, reduce inequality and create work. He said: “The 2013 Budget takes the National Development Plan as its point of
departure. The strategic plans of government and the medium-term expenditure plans will be aligned to realise our objectives”.
Having a plan that enjoys popular support is necessary and important, but insufficient for ensuring meaningful social change and transformation. A budget that supports the plan is not sufficient condition for success. The national budget sets the macro-economic framework within which we have to work. It lays out, in great detail, what we can and what we ought to do. Once these parameters are set, we need
people, across society, with the conviction and resolve to tenaciously implement the plan.
A functional engine room – the state
One of the questions that comes up every time we discuss the plan, regardless of who we are talking with, is: Does the state have the capacity to make this plan a reality?
People are right to ask this question. The state, as a whole, is the engine room that needs to drive the implementation of the NDP. However, the state cannot be expected to implement the Plan on its own. This does not mean that the state should not lead the process or be held accountable for its responsibilities and obligations. If we are going to move in the right direction and at the right pace, then there are some pretty fundamental things we need to sort out.
The first is that we can’t have public servants doing business with the state. If it’s your job to drive the engine, you can’t also sell coal to the train company. We need public servants who will concentrate on the jobs they are employed to do and nothing else. I am convinced that there is a relationship between the difficulties we experience in the procurement system in government and the financial interest of public servants, and with the reliance on consultants for basic tasks. It is one thing to draw on new knowledge and inventiveness, it’s yet another to outsource our thinking and responsibilities.
Allowing public servants to mix their personal financial interests with their professional objectives creates a perverse incentive - this should be obvious to the most casual observer. On behalf of government, the Minister for Public Service and Administration is working on a set of measures to address this.
Honourable guests, we are not going to solve our problems overnight. We will encounter resistance from people who will seek out new loopholes to protect their interests. We will encounter opposition and criticism from people who benefit from the status quo. It is critical that we start by putting a ban on public servants doing business with the state. It perverts the efficiencies and effectiveness in the supply of goods and services.
In addition to supply chain management problems, we need to fix what appears to be deficient business processes in government and introduce consequences for failures, non-delivery and non-compliance Why is it that you can go to a chain store in the most remote part of the country, and readily find the goods you expect to find and ATMs dotted across the landscape of our country that dispense notes day and night but we seem to struggle with a simple task of supplying each clinic with the right type and quantify of drugs?
Why do we have more teachers in one school than it needs – the excess teachers’ problem – and not enough in others? Why is it difficult to ensure that every learner has a qualified maths teacher for a maths lesson? These are problems that require systems re-engineering and political leadership to take on vested interests which benefit a few at the expense of our people.
I want to make a claim, here, which I am sure you will agree, and it may seem commonsensical, but which we should not allow to become passé. As parents, we have one expectation of our teachers. We expect them to teach, and prepare our children for a better future. When teachers perform below expectation or neglect teaching to demonstrate a grievance – genuine or not – it is the children of the poor
who suffer. We must be outraged when teachers sexually abuse our children; just as we must be outraged by parents who disrupt schooling because they are unhappy with a proposed municipal boundary demarcation. We need a social pact that says whatever the grievance anyone may have, schooling should not be disrupted.
The greatest achievement of a teacher should not be a new luxury car, but to educate and open the world of ideas and knowledge, to empower our children. Only then, can you say you have done your job. If you’ve become a teacher for any other reason you should not be allowed near our children.
A similar commitment is required from the providers of health care in our country. At the moment, when a clinic runs out of medicines, nobody seems to know why or how this has happened. At the one end of the supply chain, we know that the medicines left the warehouse, but nobody knows where they went after that. Nobody expects those who do deliveries to keep a register of what they delivered to each clinic. At a very basic level, we need to look at the way our systems are working. This means working through particular problems, paying attention to detail, developing systems that work. We also need to instil a sense of responsibility at each step of the supply chain. Nurses cannot provide health care and attention to patients if support staff do not understand or accept that they are obligated, and are part of a system that is noble and necessary.
Of course, that’s only one part of the accountability story. We also need to strengthen the effectiveness of oversight mechanisms from Parliament. We have to ask the difficult questions from how departments are run to parents asking about the quality of education their children receive. We have to always expect the best and provide oversight to ensure that best practice is delivered – not just to ourselves as government officials. Our own benefits are not why we are in the public service. We need to ensure, therefore, that citizens are able to access appropriate information and that there are appropriate mechanisms through which they can engage.
This doesn’t mean setting up talk shops and social functions; it means we have to actively ensure that we provide the best public services to all South Africans, all the time. Distinguished guests, meaningful participation has to be sustained. It has to be a conversation, followed by action, accountability and consequences if we fail in our duties. If we simply consult and then carry on as usual, then we undermine the
credibility of the consultation process. If you go and consult, and make promises and don’t deliver on them, then that also undermines confidence and further erodes the credibility of the public service – especially when people see that it works for public servants but not for themselves.
We have to engage people in sincere and meaningful ways. When people articulate their concerns, we have to be honest. We must be careful not to raise expectations, but not fall into the trap of expecting people to continue to live in poverty, ill-health and under an education system that traps them in poverty. We must engage and talk with people to identify the most pressing problems and those which ones can most realistically be solved, then go back and let people know about progress. If it hasn’t been possible to do something you promised to do, explain why. Explain how together we’re going to overcome the obstacles. Above all, perhaps, listen to people. Many people understand their own problems very well and are ready to make sacrifices and become active and engaged in their own empowerment – if we encourage them and let them!
The other big issue is skills. We know that the problem of skills will not be solved overnight but we will continue to push back solutions if we don’t fully understand the problem and tackle it in a meaningful and measurable way. Building skills takes time, and it’s not just about how many qualifications you have or how many training courses you’ve attended. Of course those things matter, but what really matters is
your attitude and ability to do your job. People must feel they are valued. They must feel that their sacrifices and dedication at entry levels of career levels are appreciated, that mobility is guaranteed and that they can, generally, improve their lives through hard work and dedication.
On the one hand we must do more to root out people who lack the skills or motivation to do their jobs effectively – those who get through the work days by the seat of their pants - but we must also do much, much more to nurture people’s potential, talent and commitment. Many young people take up jobs in the public sector every year. I suspect that many of them come in hoping they’ll be able to
change things, to make a difference, to contribute something positive. The question is: What are we doing with that raw talent? Are we harnessing it? Are we giving these young people the tools, guidance and support they need to make the engine pick up speed? Or are we simply putting them behind a desk, turning them into paper-pushers rather than agents of change?
We need to ensure that people are stretched and challenged from day one, but also supported and guided. That’s why the Commission has given a lot of attention to this issue. The National Development Plan makes a set of proposals on how we can ensure the public sector provides a working environment where people are encouraged and supported to learn on the job and to develop their skills in the course of their work.
If we don’t get these things right, we’re not going to be able to achieve our objectives in terms of eliminating poverty and reducing inequality. A major factor contributing to inequality of opportunity is the uneven quality of public services, and to address this we need to focus in a serious, sustained way on improving the quality of services and that means making sure our systems operate effectively guided by a strong
commitment to our developmental objectives.
So the clarion call just has to be, “Let us repair the engine room!”
The economy
I would hope that it is not necessary for me to explain to this gathering why growing the economy is an integral part of our strategy to eliminate poverty and reduce inequality. The NDP proposals on the economy are based on the understanding that economic growth expands total incomes as well as production. Economic growth also generates higher revenues to finance programmes, to eliminate poverty and
reduce inequality. And in order to generate capital to invest in the domestic economy and create jobs, we need higher exports.
In the State of the Province Address Premier Kiviet referred to work done to promote industrialisation and job creation. This includes important interventions from the automotive industry, to greening the economy, and to agro-processing and forestry sectors. We need to undertake these interventions and more. We need a better understanding of economic activities in which the Eastern Cape has competitive advantages.
Greater attention will need to be given to a range of microeconomic reforms. In the Business Report of 7 March, Mario Spannenberg, President and MD of GM Africa is quoted saying “the country needs to provide an environment in which it is conducive to do business”. He mentions four areas that need to be dealt with. These are a stable labour environment, controllable cost, competitive suppliers, and a focus on
education.
In our research and consultations, the Commission came to the same conclusions. The South African economy suffers from low levels of competition, large numbers of work seekers who cannot enter the labour market, low savings and a poor skills profile.
Uncompetitive markets and low levels of investment make it harder for new firms to enter the market and so impede job creation. Uncompetitive labour markets keep new entrants out and skew the economy towards high skills and high productivity sectors. Low savings mean that the country is reliant on foreign capital inflows, which reinforce the oligopolistic nature of the economy since foreign investors invest in
existing high-profit firms. And the skills constraints push up the premium for skilled labour, creating a large gulf in the salaries of skilled and unskilled people and so raising levels of inequality and expectation.
Overcoming these problems is not easy as any solution must tackle the problem holistically. The plan’s proposals on the economy therefore include raising exports, improving skills development, and incentivising the employment of young, low skilled work seekers.
The plan also proposes using fiscal policy more effectively to raise savings and investment, measures to increase competition in regulated sectors and broadening price regulation in sectors that are natural monopolies. To promote economic growth we need to reduce the costs of transport and logistics, address spatial divisions and reduce the cost of living for those who are out of work or in low paying jobs.
Increased rates of investment will be achieved initially through state spending on infrastructure, aimed at “crowding in” private-sector investment. The focus should be on infrastructure that reduces costs for business and households. Private-sector investment will also be stimulated by greater policy certainty and ensuring that all policies are considered in light of their impact on the competitiveness of South African companies. Businesses are also likely to invest more on the back of expanding consumer markets, including those on the rest of the continent.
To unlock the growth potential of the economy the NPC argues that the major binding constraints on growth need to be addressed. Such issues include energy generation and distribution, urban planning approval processes, water supply and waste water management, logistics, telecommunications, and licensing for water, minerals and environmental permits.
Microeconomic reforms in the areas of food, transport and telecommunications can help to reduce the cost of living and doing business. We also need to develop the capabilities of the workforce. Earnings need to be sufficient to ensure a decent standard of living, but also be realistic from the standpoint of international competitiveness. This means a stable and constructive environment will be needed in which bargaining and labour relations both support investment and protect human rights.
The Plan argues in favour of a more responsive labour market that helps to create jobs, raise living standards and reduce inequality. The NDP recognises that this is not an easy balance to strike. In the first five years of the Plan emphasis will have to be on job creation while maintaining living standards for those already in employment.
Rural development
The Eastern Cape is largely rural. Agriculture in the Province has the potential to expand if the necessary environment is created. Premier Kiviet’s State of the Province Address highlights a number of initiatives to revitalise agriculture in rural areas that are underway. Central to our efforts on rural development is to ensure that the land in the hands of our people is put to productive use. In addition to ensuring
access to important agricultural inputs, we must improve the availability and quality of extension services.
A further requirement is tenure security for black farmers in the communal areas, and under the land reform programme. As long as these farmers (especially women farmers) do not have secure tenure, they will not invest and agricultural production will not grow at the rate and in the pattern required for growth in employment.
The focus should be on co-operating with traditional leaders to secure tenured irrigable land supported by fully defined property rights is made available. This will allow for development and give prospective financiers and investors the security they require. It is a difficult problem we need to solve. This province could be the right place to solve it.
Investment in infrastructure
The Mzimvubu River is the largest river in South Africa that is unused for water development. A dam on the Umzimvubu River could support agriculture, domestic supply, hydropower production, transport, tourism and could mobilise the natural resource advantages of an otherwise underdeveloped area, if planned in a coordinated manner. We need to unlock this potential.
The Eastern Region can benefit from increased investment in the strategic transport routes crossing the region between KwaZulu-Natal and the Western Cape, with associated public transport facilities to upgrade mobility of goods and people. Improved rural access roads will be a vital component of rural development in the Eastern region to link smallholder farmers to both sources of inputs and to markets.
These routes will include the N2, the Wild Coast Highway, the R56 and R61. Rural economies will need to be activated through the stimulation of small-scale agriculture; tourism, including the creative and cultural industry; and mining investments and related spin-offs. Public-sector procurement will need to be leveraged to stimulate local activity.
Conclusion
I could go on and lift proposals in different chapters of the NDP that have relevance for the Eastern Cape, but that will guarantee nothing. Much will depend on strengthening local institutions and leadership. We need to focus on how to address the most pressing problems that beset our country – the twin scourges of poverty and inequality, and one of the main causes of misery and instability in our country, unemployment.
Honourable guests, this is not a time for posturing. This is not the time to play ideological games. We have to find ideas that work; not ideas that sound right. We have to produce policies based on evidence, not on scare tactics, or nostalgia for a time when the world seemed simpler and our enemies were ‘out there’. Our enemies are with us; poverty, inequality and unemployment are destroying our country. We
have one chance to give our people a better future.
Before I conclude, let me quote the President’s State of the Nation Address again: “The National Development Plan provides a perfect vehicle for united action precisely because it has the support of South Africans across the political and cultural spectrum. Leaders in every avenue should be ready to rise above sectional interests and with great maturity, pull together to take this country forward.”
Honourable guests, we should never tire of striving to create a better country for coming generations. It is why we joined the liberation struggle, why we joined government, and why we are now planning to secure a better future for the generations of South Africa that will follow us. I want to leave with the following statement. If we, in public service, cannot see the simple causal links between skills,
education, good health, employment, prosperity and increased trust and stability, then we don’t belong in the public service. We are not in this for ourselves. Too many people depend on us.
Thank you very much for your patience.
