P Mlambo-Ngcuka: National Economic Development and Labour Council
(Nedlac) Annual Summit

1 September 2007

Theme: "The Economics of Development � Key Achievements and Challenges for
South Africa"

Programme Director,
Minister of Labour, Membathisi Mdladlana,
Minister of Trade and Industry, Mandisi Mpahlwa,
Other Government Ministers present,
President of Business Unity South Africa (Busa), Patrice Motsepe,
Community Constituency Leadership
Secretary General of Congress of South African Trade Unions (Cosatu),
Zwelinzima Vavi,
Chairperson of Joint Initiative on Priority Skills Acquisition (Jipsa), Gwede
Mantashe,
Nedlac Executive Director, Herbert Mkhize,
Senior Government Officials,
Leaders from all the Nedlac constituencies,
Distinguished guests,
Ladies and gentlemen

I am honoured to have the opportunity to engage with you on this auspicious
12th Annual Summit of Nedlac, a critical focal point of our social dialogue.
During the fourth annual Nelson Mandela Lecture in 2006, Honourable President
Thabo Mbeki said "despite the advances we have made in our 12 years of freedom,
we must also recognise the reality that we still have a long way to go before
we can say we have eradicated the embedded impulses that militate against
social cohesion, human solidarity and national reconciliation." I believe this
is even more relevant in the context of the theme of this annual summit: The
economics of development, key achievements and challenges for South Africa.

Government, like many of you in this meeting, we believe in and support the
growth-development nexus that shared economic growth is a condition for
development and in the long-run, people development is a condition for
meaningful and sustainable economic growth. Put differently, not all growth
translates into development and without development; economic growth will be
imperilled by the very inequities that it sets in motion.

The understanding of this growth-development nexus informed our approach to
the Reconstruction and Development Programme (RDP). It will be the approach we
are grappling with. The RDP emphasised growth combined with development and it,
in turn, informed many of the policies we adopted. The Accelerated and Shared
Growth Initiative of South Africa (AsgiSA) is a logical continuation of these
initiatives, premised on the importance and centrality of growth and
development with the state playing a greater role. A necessary step towards
building a developmental state.

The RDP emphasises that "no democracy can survive if the mass of our people
remain in poverty, without land, without tangible prospects for a better life.
Attacking poverty and deprivation must therefore be the first priority of a
democratic government." Using the dead assets in the hands of poor people
remains "a must do," be it land, indigenous knowledge, livestock owned by mine
workers in the poverty stricken villages, etc.

An important question that we need to ask today is: how can we ensure that
the growth we have seen in the last few years translates into development, job
creation, improvement in people's living conditions and poverty reduction! That
is while we attend to other growth inhibiting macro-economic trends that creep
in at different times.

The biggest challenge facing government and all social partners is to change
the lives of the millions of our people who have fewer chances to make ends
meet on their own to build a caring society. All of us in government
nationally, provincially and locally, the private sector professionals, civil
society in our various community and non-governmental organisations have to act
jointly and severally to ensure that we meet this common objective. If we do
not do this, there is a prize to pay by all of us.

Some four years ago, together we embarked on this journey when we adopted
far-reaching agreements at the Growth and Development Summit (GDS). Correctly,
we identified our joint responsibility to ensure higher rates of economic
growth; more jobs, better jobs and decent work; improving equity and
empowerment in the economy and local participation as the key areas on which we
needed to focus.

As you would be aware, the report presented recently by the Executive
Director of Nedlac, Mr Herbert Mkhize (summarised in his presentation today)
does point to welcome progress made in most areas in the GDS agreement we also
need to be frank about the failures. In some cases the detailed targets we had
set ourselves then, were not very ambitious given the social and economic
challenges that we face. While the progress that we have made since 2003 should
be appreciated in some cases and indeed celebrated. What this progress has laid
bare is the massive responsibility that we have, as partners, to improve our
performance.

It is in this context that we sought, as government, to developed new
emphasis to address these challenges. The Accelerated and Shared Growth
Initiative (AsgiSA), developed in consultation with the social partners is
aimed at ensuring that, by 2010, our economy grows at an average of at least
six percent per annum. But most importantly, for AsgiSA is to agree on what to
do to eliminate the conditions that reproduce the Second Economy. This we aim
to achieve through dealing with the following conditions:

* Access to affordable and reliable services: Starting by meeting our set
targets for sanitation, water, energy, Information Communication Technology
(ICT) and roads.
* Quality public education: Those ones with less than 12 years of school. That
is South Africa's greatest challenge. Let us make Sector Education and Training
Authorities (Setas) work!
* Increasing the number of entrants into the labour market to balance demand
and supply for jobs. And build policy and capacity to do this. The Employment
Services System of South Africa is one such capacity.
* Improving the capacity of the state to deliver economic services and to
enable co-operatives and all sizes of entrepreneurs to enter the SA Economy
which has its baggage and blend of racial capitalism. Black Economic
Empowerment (BEE) is one attempt to respond with all its challenges, which we
must address the challenges as we go because stopping, is not an option.
* Anti-poverty measures that predictably reduce numbers of poor people.
That is:
1. number of poor household or families reduced as well as
2. levels of poverty
3. prevent poverty and Second Economy conditions for children and youth.

* Local Economic development with rural development, which changes the life
in each community. Fundamentally, which also supports the Proudly South Africa
Campaign.
* Only when we are together in building a developmental state based on a
national consensus which Nedlac must lead us on, common priorities especially
Poverty Eradication and Elimination, with a solution to manage supply and
demand for jobs because that will require business unusual. The consensus must
be on the how and also the agreement on measurable outcomes in quality and
quantity. And on what we do with poverty and unemployment. Part of our
anti-poverty strategy has to be about greater investment on women.

We should take this opportunity to thank all social partners for the
contribution that you are making to the realisation of these objectives. Thank
you for co�operation in AsgiSA or Jipsa especially in skills development. We
are taking steps towards right direction for co-operation on building
co-operatives through amongst others jobs for growth. Labours donation of R900
000 from the Job Trust to build co-operatives for women is highly appreciated.
In the past, Nedlac played a critical role in setting out the broad policy
framework for a democratic and prosperous society. Today, its relevance lies in
the fact that it should ensure that, in actual practice, we act in unison
implementing joint, and separate but complementary, programmes to make a better
life a reality. We need a binding consensus to remove binding constrains, which
will be a contract between the poor and rich to close the inequality gap, that
goes beyond a contract of the ruling party with the people. We need a contract
with poor households so that we can work with the poor such that they can end
their own poverty as business, government, labour, and society at large.

In this regard, we will need to pose the questions: given these new
challenges, what are institutional and capacity requirements that a body such
as this should have; what are the systems that should be put in place to meet
the new accent in its work; what style and posture should be adopted by each
constituent part of Nedlac to ensure that this body meets its mandate under
changed circumstances! If we agree on a new consensus it means each social
partner should critically examine its own capacity, systems, posture towards
other partners and style of work.

Improving the strength of each constituency and that of Nedlac as an
integrated entity is critical not only from the standpoint of the smooth
running of the institution but also because it will improve the quality of our
decisions and the outcome of our joint efforts. All our constituencies indeed,
the people as a whole expect this from us because they know they stand to
benefit if Nedlac functions better.

We don't just need sector plans, we need sector consensus and sector plans
and in each sector we need tight and binding targets. We also need corrections
for market failure that we already know and we can build on the industrial
strategy.

On HIV and AIDS government has already done the following:

* government has increased sites for antiretrovirals (ARVs) provision
* government has introduced dual therapy and mother to child transmission
* I have met with National Association of People with AIDS (Napwa) and
Treatment Action Campaign (TAC) to discuss having a unified sector dealing with
people living with HIV and AIDS
* we are also going to meet as a South African National AIDS Council (Sanac) on
10 September 2007.

South Africa can be at the cutting edge of new values in global politics,
which means we in South Africa can form and sustain the best of socialist
values in the womb of our capitalist really best interest for all. An
impoverished majority is not good for all. The prosperity of a few is false
prosperity it is living in glass house in a world of tremors.

Our presentations and discussions have brought to our attention a glorious
future that beckons. I can see a future in which we have defeated crime,
poverty, disease, joblessness. I know what we need to do to reach it. All the
role players are there and in one phrase, what this Summit enjoins us to do is
to roll up our sleeves and get down to work!

Thank you!

Issued by: The Presidency
1 September 2007
Source: The Presidency (http://www.thepresidency.gov.za)