Director-General Dondo Mogajane: Launch of the City Spatialised Economic Data Reports

Speaking notes by Director-General Dondo Mogajane at the launch of the City Spatialised Economic Data Reports

City Economic Development Managers and colleagues, sector department and State- Owned Entity representatives, partners such as the World Bank, SALGA and the SA Cities Network, the broader research community, private sector representatives and other interested parties.

Today’s launch of eight metro reports containing spatialised economic data drawn from anonymised tax data sources is a first for South Africa. The importance of having spatialised data means that for the first time we as a country are able to understand and compare what is happening over time to formal firms and jobs within specific city spaces – the central business districts and smaller economic nodes, industrial parks and Special Economic Zones, townships and logistics hubs – and also where jobs are being created and where firms are locating at a city-wide level.

Previously, we were largely reliant on economic modelling and expensive business surveys to estimate these trends. While substantial work is done by organisations such as Statistics South Africa (Stats SA) producing important economic data, their primary mandate is not focussed on producing sub-metro information. Metros in South Africa have consistently requested access to spatialised administrative economic data from various government agencies and departments, but with limited success. The availability of tax data within National Treasury’s Secure Data Centre presented a “quick win” opportunity to address the dearth of economic data at metro level, and this project became the first attempt to utilise this data within the Facility to inform city level policy and planning.

 

The availability of anonymised tax data within the National Treasury’s Secure Data Centre is made possible by collaboration between the South African Revenue Service (SARS) and National Treasury (NT) and a partnership entered with the United Nations University World Institute for Development Economics Research (UNU-WIDER) in 2015. The data housed in this Facility includes information related to Company Income Tax (CIT), Personal Income Tax (PIT), Value Added Tax (VAT) and Customs. This partnership enables the mining of this anonymised data to support evidenced- based policy and research by various departments within National Treasury as well as researchers (who can apply to gain access to the data facility). Up to this point the data has been mined primarily to support macro-economic policy.

Having this information available at a sub-metro level means that South Africa is now in a far stronger position to tackle the spatial transformation of our cities and address the persistent Apartheid legacy of a mismatch between where people live and work. This has resulted in a huge cost of transport and time burden on the poor as they are required to travel long distances to their respective places of work. Such costs have often been prohibitive and entrenches the exclusion of the poor from full participation within the economy.

Sub-metro economic data is integral to support the work of policymakers, planners and practitioners within our cities to make better informed, data-driven decisions and policies to address these spatialised and structural inequalities within our cities and boost economic growth; whether that be identifying locations for low-income housing, evaluating transportation infrastructure investment, deciding on how we subsidise various modes of transport or identifying areas earmarked for commercial or industrial investment.

The fact that this data is being released at metro level is not accidental. It reflects the acknowledgement of the strategic importance of the eight metropolitan municipalities in South Africa in ensuring that our developmental goals of inclusive economic growth and spatial inclusion, justice, efficiency and resilience are achieved. The eight metros collectively contribute more than half of employment and GDP to the country. According to the National Planning Commission, over 90% of all jobs created in the country between 2015 and 2019 were found in the metros. The performance of the national economy is thus dependent on the performance of the metros.

The benefits of connected and productive cities extend far beyond their boundaries to smaller towns and rural areas. Cities generate strong demand for the foodstuffs, raw materials, energy, water and other natural resources from the countryside. The taxes generated in prosperous cities are also redistributed to support public services and livelihoods in poorer towns and rural areas. Dynamic urban labour markets create many decent jobs, which lift people out of poverty and support social mobility.

Addressing structural economic constraints and spatial inefficiencies will go a long way to ensuring that we have more productive, competitive and sustainable cities that are able to drive national economic inclusion and prosperity.

The release of these metro reports is not intended to be a once-off event. The intention is to prepare anonymised data panel sets that have been agreed to with SARS for the metros on an annual basis.

I am proud to announce a partnership between National Treasury and the Human Sciences Research Council to ensure the preparation of these data panels, accessibility by the metros and the broader research community to these data panels, and the building of analytical capabilities within the metros on a sustainable basis.

While the use of this data fills a major gap within a drive for more evidence-based policy within government, the efforts by National Treasury to secure other administrative data sources to fill remaining gaps on behalf of the metros will continue. In particular, the limitation of this administrative tax data set in providing information on the informal sector and non-tax registered firms and individuals, is acknowledged. This remains a key gap to fill.

Whilst I have emphasised the importance of this data for the metros, I am well aware of the value of this data to academic institutions, civil society organisations, think tanks, private sector entities and active citizens who are all contributing to improving South Africa. We welcome the use and analysis of this data and the constructive input that will be generated to guide the whole of government’s plans and investments within metro spaces.

I thank you.

Issued by
More from
More on

Share this page

Similar categories to explore