A few weeks ago the ANC converged on Nasrec for its 2022 policy conference. The conference is supposed to be the guiding light for its members to deliberate on critical issues ahead of the national elective conference scheduled for December.
Given the many challenges faced by the state the ANC presides over, its policy deliberations remain important for all of us — as long as the party remains in government. From the resolutions, issues relating to the economic question naturally attract a greater level of interest as this is the one aspect we all agree needs to be addressed with a greater sense of urgency.
The ANC’s challenge is that so much of what it has tried before has failed to achieve the stated optimum outcomes. In the absence of getting the economic question right, so many of the other intersectional challenges the ANC says it wishes to address — poverty, unemployment and inequality — remain simply intractable.
The hope, despite all the evidence indicating otherwise, is that the ANC can use the collective lessons it has learnt over the years to articulate a more cogent vision for the country’s economic pathway. But based on the policy documents that have been released so much of what should be immediate action plans sound like speculative statements of intent. Having put Cyril Ramaphosa at the helm of the party, partly using the narrative that his business acumen would bridge the great divide between the party and the world of business, the ANC’s performance on that front has been less than impressive.
Given that 2024 brings another general election, it is inevitable that the party will seek to capitalise on any easy wins that might project the image of a party still in control of public resources. One of these relates to the social relief of distress grant that has been in place since 2020. The grant — pitched at R350 — has reached many citizens without means who would otherwise be forgotten by the system. It has also corruptly reached many employed civil servants who, quite bizarrely, according to employment & labour minister Thulas Nxesi, cannot be weeded out of participation.
As it was implemented as an emergency measure rather than an extension of social assistance policy, the durability and feasibility of it all has remained a talking point. Just like the e-tolls question, the ANC has opted for the perpetual deferral approach where the grant will keep getting paid at this level until something happens. The problem is that such commitments cannot simply be a matter of an emergency response that gravitates towards permanence with no explanation of what the plan is.
As it stands now, those who receive the grant are not sure how long it will be for. In light of the cost of living crisis, there is the unavoidable question of purpose. If the grant is meant to enable recipients to afford basic necessities, the inflation associated with those necessities cannot be ignored by the state. If the view is that this should form part of the standard social assistance programme, the state needs to make this explicit and then move to the question of resources.
Like many other organisations, the Organisation for Economic Co-operation and Development (OECD) has recommended that it be maintained for the long term. On the funding question, it imagines that increased VAT, cutting corporate taxes and cutting exemptions for individual taxpayers are the immediate solution. While these may well pass the mathematical test, the current state of the country — high unemployment and a fragile tax base — means government not only has to tread carefully in this case but will have to pray that those targeted by the OECD for additional taxes will still be around by the time government gets to implementation stage.
• Sithole (@coruscakhaya) is an accountant, academic and activist.
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