DA's Plan for Growth and Jobs - Democratic Alliance

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CONCLUSIONSouth Africa’s economy is divided into insiders and outsiders. On the one side are those whohave jobs, homes, and the prospect of rising incomes and a better future. On the other sideare the millions of poor South Africans who continue to be excluded from the economicmainstream. After 18 years of democracy, this is an unacceptable state of affairs.This document sets out the DA’s plan to reduce poverty and create jobs by putting SouthAfrica on a path to rapid economic growth. It outlines how the DA will break down thebarriers that inhibit opportunity by creating an open and inclusive economy in which eachperson has the skills, the opportunities, and the resources, to become a productive memberof a dynamic, integrated and forward-looking society.Breaking down barriers - to job creation, to having a real stake in the economy, to a betterstandard of living - and building a high-growth, stakeholder-led economy, will be thecentrepiece of DA economic policy as we move forward to 2014.South Africa’s insider/outsider economy is no accident.It is a product of our nation’s tragic past and its troubled present. The system of apartheid,which involved the legislated denial of opportunity to black South Africans – to assets, jobs,proper education, and even citizenship – left an economic legacy of racially determineddisenfranchisement, marginalisation, and exclusion, which confined our nation’s talent andwounded our psyche.Despite the political miracle of 1994, the policies pursued by successive nationaladministrations have not fixed this legacy, but have instead created new barriers that protectelites and established insiders while excluding millions of poor South Africans fromaccessing economic opportunities.Breaking down these barriers is essential if we are to effectively tackle the triple challenge -of unemployment, poverty and inequality - facing South Africa today. It is the DA’sfundamental purpose and overriding goal.Creating an open and inclusive economy is no simple task. It means breaking down thebarriers that keep young, poor and low-skilled South Africans out of the job market. It meansbreaking down the high costs and bureaucratic red tape facing entrepreneurs and smallbusinesses, and making it easier for poor South African to own assets.It will require that we challenge established interests.Vested interests that seek to monopolise access to opportunity for the privileged few at theexpense of the majority – whether in the form of closed business networks, patronagepolitics, or protected employment for members of labour union COSATU and its affiliates –needs to be met with bold and decisive action.The high costs and bureaucratic red tape facing entrepreneurs and small businesses needto be drastically reduced and the scourge of corruption and poor service delivery needs to beeliminated so that we can begin to build an effective state that works to improve the lives ofSouth Africans.For this plan to succeed we need a healthy, growing economy.In many developing countries of Asia, Africa and Latin America, strong economic growthcombined with smart social policies has resulted in sharp declines in poverty and85 | P a g e
unemployment. In these countries, the end of poverty is not a vain promise. The reality is insight.However, no country that has tackled the interrelated challenges of poverty andunemployment successfully has done so in the absence of high rates of investment andstrong economic growth. Both are necessary to create new wealth and opportunities. Aneconomy capable of doing this has more to share: enough, for all, forever.The DA has closely studied the experiences of these high-growth developing countries in thedevelopment of this plan, which focuses on five key areas:Opening job opportunities to all: Breaking down barriers to entry in the job marketrequires multi-faceted reform programme that creates incentives that encouragebusinesses to hire more people; that ensures delivery of high-quality education andtraining so that job-seekers have marketable skills; that makes it is easier for youngpeople to access employment by reducing barriers to entry faced by first-time jobseekers; that ensures a fairer relationship between work and pay; and that allowspeople with drive and determination to reach their full potential.Breaking down barriers to inclusion: The priority of this section is to make it easierfor poor South Africans to have a real stake in the economy. It includes policyproposals ranging from financial incentives to enhance Broad-Based BEE and extendthese benefits to non-listed companies; legislative changes to make it easier for poorand low-income households to own the homes they live in; additional stateassistance to expedite land reform and broaden ownership in the agricultural sector;and changes to the social security system to make it more proactive in helpingpeople bridge the gap between poverty and opportunity. Half of all policies in thissection are designed to help poor South Africans own assets.Opening the economy to competition: Breaking down the barriers that keep thecost of living high, and protect economic insiders from competition from new andinnovative entrepreneurs, requires a range of policy interventions that challengeestablished interests. The section includes policies designed to: augment the powers,and increase the budget allocations for the competition authorities and the NationalConsumer Commission; slash red tape so that it is easier for people to start and grownew businesses; create an environment that actively encourages innovation andentrepreneurship; ensure that government support services that are reliable, efficient,high-quality and corruption-free.Building the base through trade and investment: Breaking down barriers to tradewith Africa and the world, and building the foundations for long-term growth byreorienting fiscal policy to prioritise investment, are the two fundamental cornerstonesof the DA’s growth strategy for South Africa. This section explains how we plan to:engage Africa as a strategic market and economic partner; radically simplify the rulesand procedures involved in importing and exporting goods in and out of the country;increase infrastructure investment to 10% of GDP to deal with current backlogs;rationalise South Africa’s state-owned enterprises; and eliminate wastefulexpenditure through tighter fiscal governance so that our resources go to building theeconomic base rather than lining the pockets of politically-connected elites.A sustainable future for all: Achieving inclusive, job-creating economic growth thatis sustainable in the long-term requires that we develop smarter ways to manage ournatural resources by living within our means; putting our country’s energy securityback on track, and tackling climate change and pollution in ways that create, rather86 | P a g e
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The DA’s Plan for Growth and Jobs
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Foreword by Helen Zille, Leader of
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Foreword by Wilmot James, Federal C
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LIST OF ABBREVIATIONS AND ACRONYMSB
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PreambleThe 8% Growth Project is th
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EXECUTIVE SUMMARYBreaking down barr
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A preferable, more nuanced approach
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The DA’s policy proposals in this
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Engage Africa as a strategic econom
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This high unemployment underpins wi
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operative government’. The separa
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South Africa growth in GDP, 2000 to
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The situation is exacerbated by pol
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elieves that, with our rich mineral
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Inefficient resource allocation: Re
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credit, while the employees of thes
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have the intended effect. In develo
Page 36 and 37: FISCAL AND MONETARY POLICY PRIORITI
Page 38 and 39: Presidency and VIP security have in
Page 40 and 41: OPENING JOB OPPORTUNITIES TO ALLThe
Page 42 and 43: LONG-TERM POLICY PROPOSALSPolicy ou
Page 44 and 45: Policy outcome: Flexibility in labo
Page 46 and 47: an accredited V-TAP Certificate. Th
Page 48 and 49: SA’s global education rankingsInd
Page 50 and 51: BREAKING DOWN BARRIERS TO INCLUSION
Page 52 and 53: shareholders, and any employee alre
Page 54 and 55: SA Sports AcademyEstablish a world-
Page 56 and 57: (b) Specify that the annual financi
Page 58 and 59: Small Business Growth: A Key Driver
Page 60 and 61: Breaking down the barriers that kee
Page 62 and 63: and (ii) registering the Title Deed
Page 64 and 65: E-government in Africa (global rank
Page 66 and 67: Internet users in South Africa and
Page 68 and 69: Policy outcome: Improved state effi
Page 70 and 71: In the interests of sustaining stro
Page 74 and 75: Simplify import and export procedur
Page 76 and 77: Assessment Unit, located in the Pre
Page 78 and 79: The DA in Government: ‘No Frills
Page 80 and 81: A SUSTAINABLE FUTURE FOR ALLWe have
Page 84 and 85: MEDIUM-TERM POLICY PROPOSALSPolicy
Page 88: than limit, economic opportunities
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