DA to steer Youth Wage Subsidy through Parliament, despite Cosatu's opposition
Note to editors: This statement was distributed at a press briefing hosted by DA Shadow Minister of Finance, Tim Harris MP, DA Shadow Minister of Economic Development, Kenneth Mubu MP and DA Shadow Minister of Trade and Industry, Dr Wilmot James MP in Parliament today. The full plan can be obtained here.
Last month National Treasury announced that Cabinet had approved the Employment Tax Incentive Bill - the legislation intended to give effect to the long-awaited Youth Wage Subsidy.
We are concerned that the bill still faces significant obstacles, and are today releasing our plan to overcome them and see a real, strong Youth Wage Subsidy implemented.
South Africa urgently needs this incentive to help lower the cost of businesses taking on new, young workers. The policy was announced by President Jacob Zuma more than three year and-a-half years ago in his 2010 State of the Nation Address. The original plan was budgeted to cost R5bn over the three-year medium term budget cycle. At the time National Treasury estimated that the employment subsidy would benefit 423 000 young people.
Opposition from Cosatu, who refused to consider the policy at Nedlac, means that no progress has been made on implementing it. Whilst government has dithered, 218 000 young South Africans have since joined the ranks of the unemployed.
But if the policy had been implemented in 2010 and continued to today it could have benefitted almost 500 000 young people.
While we welcome Treasury's introduction of the Employment Tax Incentive Bill, it is clear that this bill faces a number of obstacles before it can be successfully implemented. Today the DA puts forward our plan to help overcome these obstacles and assist in getting a real, strong Youth Wage Subsidy implemented.
The DA's plan for a real, strong Youth Wage Subsidy includes the following:
The bill has not been prioritised by the ANC in Parliament: The DA will seek clarity on whether the Employment Tax Incentive Bill has been prioritised by Parliament's Programming Committee when it meets later this week - this follows the exclusion of the bill from the ANC's reported "prioritised bill list";
Nedlac has not concluded discussions on the Youth Wage Subsidy: The DA will today write to Nedlac's Executive Director, Mr Alistair Smith, requesting an urgent meeting with him on the status of discussions relating to the proposed implementation of a Youth Wage Subsidy and how to move them forward;
The bill has not been "approved by all constituencies": The DA will put parliamentary questions to Minister Ebrahim Patel, the author and broker of the Youth Employment Accord, to determine whether all Nedlac constituencies have approved Treasury's Employment Tax Incentive Bill as required by the Accord;
The Youth Employment Accord progresses with no mention of the bill: The DA will ask Minister Patel for a copy of the first quarter audits on the Youth Employment Accord presented to Cabinet last week to determine the outcomes of the Accord, and whether the Employment Tax Incentive Bill is seen as part of the efforts of the Accord;
The money for the Youth Wage Subsidy is now funding the Youth Employment Accord: The DA will submit Parliamentary questions to Deputy Minister in the Presidency, Obed Bapela, asking him to clarify comments that the R5 billion originally set aside for the Youth Wage Subsidy will be used solely for the Youth Employment Accord, and outline what the breakdown of the R5 billion budget for the Youth Employment Accord is and how the Employment Tax Incentive Bill fits into this budget;
Minister Ebrahim Patel opposes a Youth Wage Subsidy: To address his concerns with the Youth Wage Subsidy, the DA will deliver a memo to Minister Patel's office setting out the successes of the Western Cape Government's Work and Skills Programme, the provincial pilot project for the Youth Wage Subsidy. We will walk him through the benefits to young people, and address the many concerns he has publically expressed;
Cosatu remains opposed to the bill: The DA will approach the leader of government business in Parliament, Deputy President Kgalema Motlanthe, to get formal assurance from him that government will not allow opposition from Cosatu to stand in the way of passing the Employment Tax Incentive Bill into law and implementing the Youth Wage Subsidy; and
Structural problems in the bill need to be fixed: The DA will work in the Standing Committee on Finance in Parliament to fix structural problems with the bill and ensure that it will introduce a real, strong Youth Wage Subsidy to the benefit of South Africa's 5.6 million unemployed young people.
The DA is proud to have fought on behalf of South Africa's unemployed young people to overcome Cosatu's filibustering and keep a Youth Wage Subsidy on the table.
The battle for a real, strong Youth Wage Subsidy, however, continues.
Where we are elected to power in 2014 we will implement a Youth Wage Subsidy as far as we can. And we will not stop fighting until all South Africa's young people can benefit from an employment incentive.
Statement issued byTim Harris MP, DA Shadow Minister of Finance, October 14 2013
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