ANC Today --------------------------------------------------------------------- Volume 4, No. 9, 5 - 11 March 2004 --------------------------------------------------------------------- THIS WEEK: * Letter from the President: Voters will not be swayed by fear or fiction * Employment I: We need a people's contract to create work * Employment II: The myth of jobless growth --------------------------------------------------------------------- LETTER FROM THE PRESIDENT Voters will not be swayed by fear or fiction The General Elections are less than six weeks away. The election campaign has picked up some steam. So great is the interest in this process that as many as 21 parties have registered with the IEC for the national elections. For the provincial elections the numbers range from 12 for the North West, the Northern Cape and Mpumalanga, to 19 for the Western Cape. New names never heard of before will appear on our ballot papers. These include 'The Employment Movement of South Africa', 'The Organisation Party', the 'Pro- Death Penalty Party', 'Royal Loyal Progress', and 'The Green Party of South Africa'. 'Keep it Straight and Simple' or KISS, has reappeared, giving a lie to the belief that the people had kissed this party goodbye, some time ago. All this suggests that we are set for interesting times as these new creations challenge the better known political formations, for the votes of the electorate. Of course, these are also times when old habits reaffirm their abiding attractiveness to some of our compatriots. One of these old habits is the use of fear to terrify the voters against supporting the ANC, to persuade them to vote for our opponents. Naturally, these opponents present themselves as nothing short of saviours without whom our country faces a bleak future. Another of these old habits is to tell all manner of stories to convince the electorate that the ANC is divided, that our Tripartite Alliance is breaking apart, that large sections of our population have had enough of ANC government, and that many now know that to elect the ANC to govern is to condemn our country to the mother of all disasters. Perhaps the most fashionable fear that is being peddled this time round is a fictional threat of a one-party state. In this context, some are marketing themselves as the best choice in the political supermarket, on the basis that a vote for them, and therefore a vote against the ANC, is a vote against a one- party state, and therefore a vote for democracy. The argument goes beyond this. The charge is made that, in any case, the ANC is anti-democratic and wants to establish a one-party dictatorship. To substantiate this allegation, various stories are manufactured to frighten the electorate. A recent one was that the ANC intends to change the Constitution to enable the President, and presumably the Premiers, to hold office for a third term, contrary to the two terms prescribed in our Constitution. So desperate are those who resort to this kind of falsification that they did not hesitate to misuse Nelson Mandela's name to lend credibility to their claims. It did not matter to them that Madiba had said that he categorically told those who raised this question that there was no such decision and there would be no such decision by the ANC to change the Constitution. In reality, the truth does not matter to these desperate souls, except to the extent that it serves as an obstacle to the achievement of their goals. The fear-factor has long been a feature of white politics in our country. For long periods, this section of our population has been subjected to the unimaginable terrors of "die swart gevaar" and "die rooi gevaar", the "black" and "red" dangers. At all times, they were told to choose parties that would protect them from these dangers. The danger of an imaginary one-party state that is now being used to frighten our electorate is nothing but a variation on the same theme. The "gevaar" is cloaked in different words. It remains the same "gevaar" nevertheless. Interestingly, the use of fear is totally alien to the liberation movement and to liberation politics. Freedom from fear is a necessary part of the range of objectives of those who fight for freedom. Rather than cultivate pessimism and fright among the people, genuine fighters for liberation always work to inspire hope among the people and confidence in a better future. Historically, it may be that those accustomed to live in a world of fear have always found it difficult to believe that those they defined as a threat could ever see them as part of a new world of hope, enjoying freedom from fear. This is underlined by the circumstance that those defined as a threat would have been oppressed and controlled to protect the dominant from what they saw as an impending danger. Thus, even in changed circumstances, such as ours, when time and practice have proved that the phobias of the past were mere phobias, those used to frightening themselves or being frightened by others, would not find it too difficult to revert to the accustomed world of fear of the future. Fortunately, many of our people have outgrown these phobias. They have become more immune to the phantom terrors spread by the scaremongers desperate to win votes at any cost. The forthcoming democratic elections will demonstrate that these scaremongers are out of step with our country's evolution away from its apartheid past. The latest fear of a one-party state is in reality fear of democracy. What is being proposed is that democracy is in danger of turning into its opposite. The assertion is made that out of democratic practice, dictatorship will be born. From this, the argument is advanced that the acid test of a democratic system is a strong opposition. The proposition is made that the 2004 elections must produce such a strong opposition, to avert the danger of the subversion and destruction of democracy. The elections would therefore be judged as a successful democratic process only to the extent that they give an opportunity to the opposition to "cut the ANC to size". Our Constitution says that one of its purposes is to "lay the foundations for a democratic and open society in which government is based on the will of the people and every citizen is equally protected by law". To achieve this objective, it states that one of the values of our democratic state is and must be "universal adult suffrage, a national common voters roll, regular elections and a multi-party system of democratic government, to ensure accountability, responsiveness and openness". Further to emphasise the importance of the principle and practice of the exercise of "the will of the people", and a multi-party democracy, the Constitution specifies that our electoral system should result "in general, in proportional representation". The implementation of these provisions, directed at as accurate a representation of the will of the people as possible, resulted in our current parliament having some parties represented only by one member of parliament. Whatever else anyone of us might have thought of this outcome, nobody could doubt the fact that it represented the will of the people, including the smallest political minority among these masses. The Constitutional provisions we have quoted constitute the very core and heart of our democratic system. The defining feature of democracy is the establishment and maintenance of a system of government based on the will of the people, with the people enjoying and exercising the right freely to express this will at regular intervals. And this is what those in our country who argue that the defining feature of democracy is the existence of a strong opposition seek to question. They would prefer that in our specific circumstances, a way could be found or something would happen, so to manage the exercise of the will of the people that it would enable them to play a role in our body politic as a strong opposition. Because they cannot decree that the people will exercise their will in a manner that produces this result, they manufacture new democratic rules intended to bind the party mandated by the people to govern to do this in consultation with the Opposition. And yet the only privilege of the Opposition recognised by the Constitution is that "the rules and orders of the National Assembly must provide for.the recognition of the leader of the largest opposition party in the Assembly as the Leader of the Opposition". With regard to the forthcoming elections, all political parties and formations, as well as our people as a whole, have a collective responsibility to create the necessary conditions to ensure the free expression of the will of the people, regardless of what will result from this free expression of the will of the people. It may be that such free expression of the will of the people will result in the ANC being elected by the people as by far the strongest political formation in the country. This cannot serve as justification for an argument that the result of this free expression of the will of the people is at the same time a threat to democracy. Those who advance this argument must be exposed for what they are, people who mouth the principles of democracy but fear the very democracy they pretend to espouse. The truth must be told openly that these are people who are convinced that the free expression of the will of the people, even in an electoral system based on proportional representation, is inimical to their interests. To hide this reality, they create all manner of scarecrows intended to terrify the people about the prospect of a decisive ANC victory. They denounce the exercise of power by the ANC, mandated by the will of the people, as something they call "majoritarianism". Thus does the will of the people get represented as a threat to democracy, a threat to the very freedom that enables the people freely to express their will. Undoubtedly, once again, the people will decisively defeat the attempt to suggest that by voting for the ANC, they are foolishly expressing their will in a manner that will result in them losing the freedom for which they fought a long and bitter struggle, led by the ANC. In the event that the people refuse to be frightened by imaginary dangers, the scaremongers would still rely on other fabrications intended to convince the people that the ANC is set to slump into a deep crisis. The aim in this regard is to convince as many people as possible that there is no point in boarding or staying on a sinking ship. Recently, some in our country discovered an absurd and non-existent ANC plan to appoint three Deputy Presidents after the April elections. The assertion was boldly made that this is necessitated by projected future "political infighting" in the ANC. And then to add to the supposed woes of the ANC, the bold assertion has been made that "at least 5,5 million trade union members and non-subscribing supporters are willing to support the formation of a workers' party to challenge the ANC, an independent survey says". According to this scenario, we must expect that the ANC will lose the support of members of COSATU and other trade union federations, plunging us into deep crisis. Of course, this will not happen. Earlier the story had been broadcast that "corporate South Africa believes a second term in office for President Thabo Mbeki will not result in better living standards, according to a new poll - a telling indictment of government's failure to reduce unemployment and accelerate economic growth". However the organisers of the "new poll" spoke out against these fabrications. They said "we cannot agree with the conclusion by the author that a belief that living standards would remain the same is a 'telling indictment of government's failure'.We therefore record our view that the provocative title of the article and some of the conclusions reached are unjustified and not an accurate report of the views of the (surveyed) audience mentioned above, let alone those of corporate South Africa." Another commentator, keen to advance the cause of the opposition parties, made bold to say that the ANC "has missed all the time frames for delivery established in the reconstruction and development programme", whatever this means in the context of what is actually said in the RDP and our experience in implementing it. Thus in one fell swoop, the ANC, presumably already in negative territory because of its failure to meet its commitments with regard to the RDP "time frames", will be torn apart by intense internal conflicts, abandoned by the workers and spurned by business. Who would blame our people if indeed they abandon such a sinking ship! The reality however is that this will not happen. The scarecrows will not frighten the people. Neither will these masses allow themselves to be led astray by the fabrications of those whose interests dictate that they try everything they can to defeat the ANC, with no holds barred. The election campaign has started in earnest. We must work among the people to convince them to renew the mandate of the ANC to lead our country as we implement the People's Contract to Create Jobs and Fight Poverty. In doing this work we must focus on what we have said in our Election Manifesto and not be diverted either by the antics that some of our opponents use to draw attention to themselves, or the fabrications they concoct to win votes. What we have to do is quite simple and straightforward. We must inform the people what we intend to do, working with them in a people's contract, further to accelerate the advance towards the achievement of the goal of a better life for all. This includes attending to the urgent tasks of job creation and fighting poverty. We must continue to draw the attention of the people to the progress we have made in the last 10 years to change their lives for the better, bearing in mind that these masses are themselves acutely aware and appreciative of what has been achieved. As the premier party of democracy in our country, we must continue to work with all our people and our law enforcement authorities to ensure that we hold peaceful, free and fair elections. We have an obligation to do everything we can so that these elections live up to the constitutional requirement that they must truly reflect the will of the people. Further to prepare for the accelerated reconstruction and development of our country that must characterise our Second Decade of Liberation, and the new victories we must achieve in building a non-racial, non-sexist, democratic, united and prosperous country, we must emphasise the need for all of us to join in a people's contract for the building of a people-centred society. We will leave the scaremongers and the tellers of false stories to define themselves as actors that have excluded themselves from this people's contract, destined to be the permanent professional Opposition. Two weeks after the elections, we will all convene in Pretoria and in our Provinces, brought together by the joyful celebration of our First Decade of Democracy, to confirm our common commitment to this people's contract. The April Elections, the last of this decade, must stand out as an unequivocal confirmation of the vitality of our democracy and our determination to ensure that the people continue freely to express their will. At the same time, we must work with the people to ensure that the outcome of these elections confirms the place of the ANC in our country as the tried and tested representative of the best interests of all our people. Thabo Mbeki --------------------------------------------------------------------- EMPLOYMENT I We need a people's contract to create work The challenge of growing the economy and creating ever-greater job opportunities will not be achieved unless all stakeholders play their part in what needs to be a massive national effort. That is why the ANC is calling in its 2004 election manifesto for a people's contract to tackle the twin tasks of creating work and fighting poverty. As an organisation determined to renew its democratic mandate on 14 April, the ANC will ensure that government plays its part in working to build the economy and create work. But it will need the active involvement and joint commitment of business, labour, communities and other organisations to ensure that South Africa is able to address the biggest challenge it currently faces. To tackle unemployment, it is necessary to understand the nature of the problem and its history. It is important to understand the shifts that have taken place in the South African economy and the challenges these pose. The economy we inherited in 1994 from the apartheid state was one in which only a minority of the population benefited. The rest of the population was consigned to live below dignified levels in poverty and marginalisation. The levels of consumption and savings of the privileged few were too small to create a wealth basis that could create jobs in the economy. In fact, the South African economy had been shedding jobs for almost two decades by the time the ANC came into government. The economy was in an advanced state of near-terminal decline. The new ANC-led government inherited a debt of about R254 billion, a 10 percent budget deficit to the GDP. This massive debt, together with a narrow revenue base, was the economic reality the new dispensation had to deal with. Added to this was an extremely narrow skills base, the result of decades of bantu education, job reservation and an economy preoccupied with the extraction and exportation of raw materials. And all of this was taking place at a time of falling commodity prices, the global liberalisation of markets, the rapid and ever-increasing transfer of resources from one economy to another, and a marked shift away from primary economic activities towards secondary and tertiary activities, like hi-tech manufacturing and services. Yet through intelligent policies and determined effort, the ANC has turned the South African economy around. It has halted the downward spiral of the apartheid years and placed the country on a sound economic footing. At the same time it has made impressive gains towards meeting the many challenges facing the country's people. The economy has created 2-million net new jobs since 1995. But the number of people seeking work has sharply increased; many workers have lost their jobs; and many have been negatively affected by casualisation and outsourcing. As a result many South Africans do not have jobs or decent self-employment; poverty is still a reality for millions who do not have appropriate skills, while many cannot get credit to start or improve their own businesses. This is the reality which the ANC has begun to address. In its 2004 manifesto, the ANC outlines the key programmes it will pursue over the next five years to ensure that by the end of the second decade of freedom, South Africa will have halved levels of unemployment and poverty. A central task is to grow the economy at a faster pace, while ensuring that this growth is sustainable and benefits the millions of unemployed South Africans. This means that the ANC will continue to ensure low interest and low inflation rates, as well as low government debt so that more resources are spent on attacking poverty, building economic infrastructure and creating work opportunities. Through government and state-owned enterprises, the ANC will invest more than R100-billion in improving roads, rail and air transport as well as telecommunications and energy; and encourage more investment in key economic sectors such as manufacturing, information and communications technology, mining, and business services. It will spend over R15-billion to facilitate broad-based Black Economic Empowerment which also benefits communities - including youth, women and people with disabilities - as well as workers and small businesses. While growing the economy, however, the key challenge is to match the skills that people have to the needs of the economy. There are many positions that remain vacant, both in the public and private sector, because there aren't enough skilled people to fill them. Increasing employment therefore requires increasing the number of people with appropriate skills. This needs to be done at a number of levels. The ANC will continue the impressive work done to ensure greater access for all to quality education. It will ensure that all children have decent classrooms, further reduce the teacher-pupil ratio, improve spending in favour of children and students from poor households, and expand the school nutrition programme. It will take more and more young people through learnerships so they can gain skills and work experience in order for them to access jobs. The ANC will also intervene to ensure proper functioning of skills development authorities. The ANC will intensify assistance to youth agencies such as the Umsobomvu Youth Fund to provide skills training for employment and self-employment; and ensure the implementation of the National Youth Service. There are also immediate, direct interventions that government can make. These will include the creation of one million job opportunities over the next five years through an expanded public works programme. This will ensure the provision of much-needed social infrastructure, while providing people with income, skills and experience. The ANC will encourage the use of labour-intensive methods in sectors of the economy which lend themselves to this form of operation, including through the government procurement system. It will also conduct research into the full impact of casualisation of labour and outsourcing, and devise ways of dealing with their negative impact on workers and the economy as a whole. Work will be done so that those who wish to start and sustain their small businesses, including youth and women, have access to credit, through dedicated funding to support micro-loan financing, through further reforms to existing support agencies and through changes being introduced in the financial system and institutions. Importantly, the ANC will work to ensure the involvement of communities in local economic development initiatives to provide work, build community infrastructure and ensure access to local opportunities, and encourage the emergence of co- operatives. The success of all these measures depends however on the cooperation and participation of all stakeholders in the economy, from the private sector to organised labour, from institutions of learning to the public servants who need to implement much of this work. It depends on the contribution that every community and every citizen makes in building a people's contract to build a better life for all South Africans. --------------------------------------------------------------------- EMPLOYMENT II The myth of jobless growth A careful look at employment statistics over the last nine years highlight the challenges of job creation, while debunking the myth of 'jobless growth'. Government's statement that about two million net new jobs have been created since 1995 has been the subject of intense discussion, and depending on circumstances of the interlocutors, facts can easily become the casualty. It is therefore not surprising that The Star should say government's assertion is "confusing" in the light of the opposition's repeated claim that one million jobs have been lost. On the other hand, Terry Bell in Business Report on 13 and 15 February argues against government's statement on account of changes in definitions used in surveys to measure employment. Bell bombards the reader with anecdotes and other statistics, which he calls the "official statistics", to further put government's position in doubt. Let's clarify things, even if it means being a bit technical. The simplest of these technical facts is one of pure arithmetic. 9.5 million people were employed in 1995, and by 2003, 11.5 million people were in employment. So, irrespective of how many people lost their jobs, net new employment in the economy increased by 2 million. In other words, if as others claim, 1 million people lost jobs since 1995, then it would mean 3 million jobs were created. Which data is used to come to this conclusion? South Africa has three official ways of measuring employment statistics: the population census, the Labour Force Survey (LFS), and the Survey of Employment and Earnings (SEE). The census surveys all households, the LFS a sample of households, and the SEE a sample of firms. The October Household Survey (OHS) preceded the LFS before 2000 when some definitions changed, particularly the definition of employment which was broadened. According to experts, including Statistics South Africa, the LFS is currently the best measure of employment. As one expert put it, "the international preference is for measuring employment through information collected from individuals, generally by means of household surveys". Firm-based surveys like the SEE rely on samples of firms that usually do not keep up with the changing structure of employment. For example, the growth of the information technology sector in South Africa in the 1980s and1990s was not addressed in the sample structure of firm-based surveys until long after the event. Recent changes to the SEE sample base had such a radical effect that the latest results suggest a forty percent increase in employment in 2002-2003. If government wanted to mislead the public it could have cited this number as evidence of its success. But government cannot afford to take liberties with data - unlike newspaper columnists and opposition parties. Fact though is that the SEE seriously underestimated employment levels before 2002. Employment data from the census is of limited value as there were not enough detailed questions on employment in the Census. That is why StatSA advised that Census data on employment should not be used as the definitive reference point on the matter. So, government has relied on what experts consider to be the best of our three measures of employment and unemployment - the OHS/LFS series. It is not perfect and there are discontinuities in the series, but none as dramatic as the discontinuity in the SEE or the omissions in Census data. Where Bell derives his "official statistics" from he does not indicate, but they are probably from the SEE. Where others get the numbers for a fall in employment of one million we certainly don't know. We expect that they probably do not know either. They do not derive from any of the official surveys. Government has relied on the OHS and the LFS because the overall trends they indicate are the best information we currently have to hand. In spite of some changes in definition between the LFS and the OHS there is a surprising degree of consistency and continuity between these surveys. Most of the increase in informal sector employment took place before the changeover from the OHS to the LFS, so the change in definition did not really seem to affect the numbers. Almost all of the increase in employment numbers after 2000 is attributable to the formal sector where employment rose by over 700 000 between February 2000 and March 2003, after falling during the 1990s. This number was not affected by the change in definition of employment. There are two obvious anomalies in the figures - subsistence farmer employment in February 2000, and "other" informal sector employment in February 2001. But we have not used those numbers for our analysis - we have excluded them as "outliers". We do not claim that all the 2 000 000 net new jobs are good jobs in the formal sector. The government's ten-year review and the ANC's election manifesto express concern about some of the effects of casualisation and outsourcing on the standards of living of workers. But the bottom line is that there has been significant job growth overall since the mid-1990s and, we suspect, even more since the early 1990s. Because the October household series begins in 1995 we do not have the numbers to back up this contention, and therefore we have not made any such claims. One analyst's view of the OHS/LFS series suggests employment growth of 2.22 million net new jobs. But because of our concerns about the data, government has not claimed more than 2 million new jobs. We have treated the numbers with care. We have not pulled numbers out of a hat to suit our arguments. The editor of a financial weekly recently pleaded that we should not politicise the employment challenge. These were wise words. We should be working together as a nation, as we did at the Growth and Development Summit, to address the challenge of employment together. In doing so, we should rely on the facts, rather than selective use of data and carefully chosen anecdotes. ** This is an edited version of an article by ANC National Executive Committee member Alec Erwin which first appeared in the Sunday Independent. --------------------------------------------------------------------- This issue of ANC Today is available from the ANC web site at: http://www.anc.org.za/ancdocs/anctoday/2004/at09.htm To receive ANC Today free of charge by e-mail each week go to: http://www.anc.org.za/ancdocs/anctoday/subscribe.html To unsubscribe yourself from the ANC Today mailing list go to: http://lists.anc.org.za/mailman/listinfo/anctoday