PARTY

COSATU oblivious to tragedy of joblessness - Zille

The DA leader says the union federation's policies are pro-poverty not pro-poor

Jobs, jobs, jobs

This weekend, the Democratic Alliance is hosting the General Assembly of the Africa Liberal Network (ALN), encompassing 24 parties from 19 different countries. Party delegates from as far afield as Burundi, Senegal, Cote d'Ivoire and Morocco will share experiences in their countries and discuss political developments on the continent.

Since its inception in 2003, the ALN has increased in size and stature. Some member parties are now in government and others are close to winning elections. This is greatly encouraging. It reflects a growing recognition that Africa's success depends on fostering openness in its politics and creating opportunities for people to lift themselves out of poverty.

This is what we and our sister parties across Africa call the open, opportunity society for all. It is a philosophy that has evolved over centuries of political thought. It can only be realised in practice through a commitment to constitutionalism and growth-centred economic policies that create jobs.

Why is job creation so integral to the open, opportunity society?

A job is the surest route out of poverty. Not only does employment provide an income in the here and now, it gives people the experience and on-the-job training that will help them to climb another rung on the social ladder. A job is also a source of dignity, pride and self-respect. Because a job rewards hard work and contains built-in incentives for people to lead responsible lives, a low unemployment rate has obvious benefits for social cohesion. Above all else, a job offers people the opportunity to lead the life they value, instead of a lifetime of dependency on the state.

This is why we believe that South Africa's top three priorities for the next decade must be jobs, jobs and jobs. The role of government is to adopt policies that make it easier for businesses to create jobs and help people acquire the skills they need to get jobs.  Nothing but a relentless focus on policies for job creation will lift sufficient numbers of people out of poverty.

Just as Finance Minister Pravin Gordhan was delivering his mid-term budget policy statement, our economic team in the Western Cape government was attending a presentation on China and Brazil's success in driving growth, creating jobs and reducing poverty. China and Brazil, along with Russia and India, make up the BRIC group of nations - a group that the South African government very much wants to be part of.  We often hear our government Ministers refer to BRICSA.  But wishful thinking is not enough.

The factors that prevent South Africa from joining these high-growth economies were evident in the presentation.

Firstly, the BRIC countries have steadily improved the effectiveness of their public sector.  Public money is invested in drivers of economic growth like education and infrastructure. And the money is, by and large, spent efficiently and effectively.

Secondly, all of these countries have rapidly improving education systems that produce graduates with the necessary skills and abilities to compete in the modern global economy.

Thirdly, both China and Brazil understand the important role that provinces or regions play in driving development. They realise that local conditions, such as geography, climate and access to markets are best understood by regional governments who are better placed than the central government to create an enabling environment for growth.

Fourthly, and most importantly, all of these countries understand how important high economic growth rates are for job creation and vice versa. They understand what policies are necessary to drive growth.  They accept the fact that development occurs differentially across a country as a whole.  They encourage, rather than punish successful regions. 

They know that as a region develops and input costs increase, so investors move to other regions, to take advantage of more competitive labour costs.  They accept that this cannot happen in an over-regulated labour regime, where wages are determined by central bargaining.  These countries are making growth their priority, because they realise that the more jobs are created, the more people can be lifted out of absolute poverty.  And the more people can use the opportunity to put their foot on the next rung of the economic ladder.  That is how sustainable development happens.

And it is what we are missing out on in South Africa. Our government's policies have destroyed job opportunities and consigned millions of people to a lifetime of dependency on a state with ever-diminishing resources.  We have to face the fact that a ratio of five million registered personal taxpayers to over 13-million social grant recipients is unsustainable.  The only way out of this is a bold and sustained job creation strategy.  We have to make the choice for growth, against all other priorities.

This week in Business Day, Allister Sparks wrote up a fascinating case study of textile factory closures in Newcastle, KwaZulu-Natal. Factories there have been forced to close because they could no longer pay workers the statutory minimum wage in the face of an influx of cheap Chinese imports. The closures sparked protests from business owners and workers alike. The employers were angry because they were going out of business; the workers were angry because they would rather earn less than the minimum wage than live in absolute poverty, without any wage whatsoever.

The irony of workers and employees uniting against unnecessary job losses must have been lost on Cosatu which continues to support inflexible labour legislation regardless.

Those factory workers in Newcastle who have lost their jobs will now join the ranks of the growing army of unemployed South Africans - two-thirds of whom are young black people under the age of 35 who have never had a job and have been rendered all but unemployable as a result.

Cosatu is seemingly oblivious to this great tragedy. Its intransigence over wage flexibility demonstrates that, for all its railing against the predatory elite, Cosatu is certainly not pro-poor. On the contrary, given the policies it promotes, it is fair to conclude that Cosatu is actually "pro-poverty".

How else can one explain Cosatu's opposition to a wage subsidy for first-time job-seekers? Such a subsidy would incentivise businesses to employ young South Africans who have never had a job. If nothing else, it would open the first door towards dignity and self-respect.

Pravin Gordhan must be applauded for his commitment to create five million new jobs by 2020. This pledge is backed up by some solid and innovative ideas, such as the R6-billion set aside for youth employment projects proposed by private firms. Gordhan has also said that government is in the process of formulating a wage subsidy scheme for unemployed youth - a promise made by Jacob Zuma in his first state of the nation address and then put on the back-burner after opposition from Cosatu.

But the truth is that, whatever the ANC government pledges (remember Zuma's broken promise of 500,000 jobs by the end of last year?), it will not be able to emulate the BRIC countries unless it calls Cosatu's bluff.  It is the disproportionate influence of Cosatu (and its affiliate the South African Democratic Teachers Union) that, more than anything else, is undermining the chances of young South Africans to get jobs.  Liberating young South Africans from this stranglehold is a priority if we are to become a model for our African brothers and sisters to follow.

This article by Helen Zille first appeared in SA Today, the weekly online newsletter of the leader of the Democratic Alliance.

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