ANC NEC must acknowledge neo-liberalism as source of troubles - COSATU

Federation says economy can't be allowed to remain concentrated in white capitalist hands

COSATU Statement on the January 08 ANC NEC message delivered by ANC President Comrade Cyril Ramaphosa at Absa Stadium in East London in the Eastern Cape

The Congress of South African Trade Unions congratulates the ANC for reaching the 106th Anniversary milestone this year. We welcome and support the January 08 ANC NEC message that was delivered by ANC President Comrade Cyril Ramaphosa at Absa Stadium in East London in the Eastern Cape.

The federation supports the general essence of the ANC NEC message and expects both the State of the Nation Address and the upcoming budget speech to focus and make sure that their content reflects the identified priorities.

We support the NEC’s firm commitment to the fight against corruption and agree with the assertion that all forms of corruption must be exposed and prosecuted, including corruption, collusion and other criminal activities in the private sector.

COSATU supports the call by the ANC NEC for strong and efficient law-enforcement agencies to lead the fight against corruption and crime in general. For this to be achieved the ANC needs to give a face-lift to its government and make sure that it deploys people of high integrity ,who will at all times act with utmost professionalism.

Some members of the current Executive are second-rate and not helpful to the cause of a people centred and people driven development. The ANC cannot continue to ignore the fact that since 2009 about 216 Directors General have been suspended, removed or shifted in 32 government departments. This is unsustainable and wholly unacceptable.

The fact of the matter is that South Africa is still condemned to a junk status by the western sovereign rating agencies, which amongst others was justified on the basis of policy and political instability within government. Decisive action needs to be taken to stop this phenomenon from continuing or we risk failing to sustain the positive economic results that we have seen towards the end of last year.

We support the plan to reduce the concentration of ownership and control in the economy by expanding the mandate of the competition authorities. We also agree that state procurement and the award of concessions should be used more effectively to promote broad-based black economic empowerment and encourage greater worker ownership.

We are happy to note that the NEC has come out clearly that development finance institutions and state banks need to give greater emphasis to employment creation, empowerment, industrial diversification, and the development of small businesses and cooperatives.

We have noted that the ANC call for a social pact between government, labour, business and communities urgently to reignite economic growth and accelerate the process of transformation. We accept this proposal as long as it is not premised on the understanding that workers will be expected to pay the price through limited or no pay increases.

Workers are already victims of government’s austerity measures and according to the Budget Review 2017 that was presented in parliament the provincial headcount has already declined by 2.8 per cent since the beginning of 2016/17. Unfortunately, this category of the general public service workers where the bulk of the decline in headcount is taking place tends to be those who are the main point of contact of government with the public or communities. This therefore means, where there are increased shortages of staff, it is the poor members of the public who are more depended on government services that would suffer from poor service delivery.

We are troubled though that the ANC NEC does not want to honestly acknowledge that despite the advances made in the past 21 years, the high levels of  unemployment, poverty and inequality can be traced back to the the neo-liberal paradigm which remains dominant in driving government’s economic policy.

The neo-liberal economic principles and philosophies continue to dominate the practice and articulation of policy. This is based on a belief that growth must occur first, and then employment will follow. and that once employment increases, the distribution of income will improve.  This is reflected in the persistent setting of growth targets as the primary focus, rather than targets for employment and income distribution.

The ANC NEC needs to acknowledge that neo-liberalism will never be helpful in the quest to address the colonial and apartheid fundamental contradictions that resulted in the white monopoly capital taking charge and ownership of the economic levers of powers while the black majority remains enslaved in waged labour.

The NEC needs to deal and confront the fact that the neo-liberal ideology has captured some elements within the state and the democratic movement, and despite them being aware of the harsh but failed medicine of neo-liberalism, they have still gone ahead to impose it on society.

It is against this background that those deployed by the movement in government have over the years abandoned the people driven and people centred approach to development.  It is in this context that the structures of the movement remain in disarray with the focus being on narrow electoral processes. The ANC cannot ignore this reality.

The notion of radical socio-economic transformation cannot continue to be factionally advanced and still needs to be properly defined and understood at an Alliance level. We still find it bizarre to this day that when Alliance partners (COSATU and SACP) challenged the economic sections of the NDP and made concrete proposals in support of the perspective of a more radical second phase of our transition they were ignored and dismissed by President Zuma’s government and the ANC.

The last time when the South African economy was on a cyclical economic upturn leading to the 2009 recession, it was mainly driven by the 2003-2008 commodity (minerals) boom, debt-financed consumer spending and property market bubble. All of these drivers have proven to be unsustainable and have been weak in the period under review, as there has been decline in investment and production in mining and manufacturing, household debt remained high, and restrictive monetary policy tightened credit extension and thus dampening household spending and the property market.

The growth rate registered in the third quarter of 2017 suggests that the economy may have escaped a full-blown recession. Unfortunately, this apparent recovery has been driven by the primary sector (mainly agriculture, forestry, fishing industry) and tertiary sector (mainly finance, real estate and business services), rather than the important productive – manufacturing industries that make up the secondary sector.

For COSATU it remains a matter of concern that manufacturing which should be at the centre of the transformation of our semi-peripheral economy has continued to gradually decline. The form in which growth and recession take place in our economy underscores the structural fault-lines of the semi-peripheral South African economy which is still trapped in a condition of dependency to the European Union and China for its mineral exports, with no substantial beneficiation for industrialisation and dominated by the four banking monopolies.

The relative persistence of this socioeconomic structure of colonialism of a special type also means that the ANC cannot continue to allow the economy to remain concentrated in white capitalist hands, the old Apartheid oligarchy.

On the other hand, the general government services, which played a key role in pulling the economy out of the recession of 2009 and in sustaining at least some positive economic results between 2010 and 2016, has been gradually contracting. This is the result of the austerity measures that have been introduced since 2014 when the Treasury began to reduce the rate of growth in government-spending, which negatively affected aggregate demand in the economy, and eventually causing a technical recession.

We are happy that the movement has reaffirmed its commitment to ensuring that the landless have access to land. We need to ensure that farm workers are protected from illegal evictions. It's not acceptable that many evicted farm workers' dependents and relatives are still denied access to their family grave sites and also that farmers destroy their homes.

The federation agrees with the ANC NEC that state-owned commercial entities should operate as powerful instruments of economic transformation. We have repeatedly and firmly called for SOE's to remain firmly within the control of the state, in order to increase their capacity to respond effectively and efficiently to its developmental agenda.  The state capture investigation should be the beginning of the process of rehabilitating the SOE’s and rebuilding their capacity to help the economy. As a country, we need a strong developmental state committed and ready to address unemployment, inequalities, and that is prepared to transform the State Owned Entities in line with the developmental agenda of the ANC government

On the Alliance, we are happy that there is commitment to the restoration of the unity of the Alliance. The best way to unify the Alliance will be for the ANC government to implement Alliance decisions without watering them down.

We want a reconfigured Alliance which is at the centre of driving the National Democratic Revolution meaning that the Alliance will collectively develop policy in line with the Freedom charter and will collectively monitor the implementation of policy and decides on deployment. We want an Alliance of equal partners

We want an Alliance which practices the Mass Line as the “primary method of revolutionary leadership of the masses. The mass line means to start with the diverse ideas of the masses, and return the concentrated ideas to the masses.

We want the Alliance to be led by the ANC whose perspective is based on an understanding that “in contrast to many old-style nationalist movements in Africa, we believe that there can be no true national liberation without social emancipation.. To postpone advocacy of this perspective until the first stage of democratic power has been achieved is to risk dominance within our revolution by purely nationalist forces which may see themselves as replacing the white exploiters at the time of the people’s victory” .

We want the alliance to be led by an ANC which understands that the strategic objectives of the National Democratic Revolution is to resolve three interrelated contradictions of racial domination , gender oppression and class exploitation . These interrelate d contradictions have not been resolved yet and therefore the entirety of the congress movement have not yet arrived!

We will fight to have an Alliance which is conscious that the primary task in this phase of our transition is to resolve the colonial and apartheid contradictions based on radical economic transformation.

We want an alliance which is led by the ANC that understands and accept in practice the leading role of the working class as a primary motive force in the National Democratic Revolution. We want an ANC which accept and understand that the working class has the enduring organisational power, occupies a strategic location within the productive force, suffers the most from both exploitation and domination, and has made the most sacrifices to advance the revolution.

We want the Alliance to be led by an ANC which accept and understand that as the organised detachment of the working class, located strategically at the point of production, we are not just an interest group or just another NGO in the revolution but we constitute the most powerful motive force of our revolution.

We shall act consciously to ensure that the leading role of the working class in our revolution is won on the ground through visible campaigns based on our political and Socio- Economic demands.

We will go beyond seeking to secure agreements in meetings about the content of radical economic transformation but the content of radical economic transformation shall be defined through heated struggles based on our political and socio - economic demands.

In conclusion, the ANC needs to be at the forefront of fighting the scourge of racism and the twin demons of tribalism and sexism in our movement and also in our society. Going forward the ANC's immediate priority should be to ensure that it has an activist government that will deliver on the promise of making sure that every cent spent by government creates jobs.

The ANC also needs to regain its lost fortitude by scrapping labour brokers, doing away with the e-toll system, meeting the deadline of the National Minimum wage, introducing the Comprehensive Social Security System and the National Health Insurance.

Long Live the ANC! Long Live!

Long Live the Alliance! Long Live!

Issued by COSATU, 14 January 2018