We must transform banks and fight financialisation - Blade Nzimande

SACP general secretary elaborates on Red October campaign goals

Red October Campaign 2015/2016 Launch Statement

This year the focus of our Red October Campaign we are launching today is twofold: transformation of the financial sector and the media. Therefore, our theme for the 2015/2016 Red October Campaign is also twofold: “Transform the financial sector and build banks which will serve the people! Free the media!” This campaign will be based on our principled programme to “Unite the working class, our communities, and our movement!”

Transform the financial sector and build banks that will serve the people!

In the financial sector we have been faced with a destructive phenomenon of neoliberalism and financialisation.  In simple language this means that we are living in a capitalist world that is based on a false notion that the market will best serve the interests of everyone, rich and poor. Yet we know that it is this very same capitalist market that is responsible for the crisis of inequality that our country and the world face today. The capitalist neo-liberal market has gone so crazy as to turn some of the workers into modern day slaves by labour brokers - companies earning money worked for by such workers and not themselves.

What is financialisation?

The world economy is today increasingly moving away from investment into productive sectors of our economy – factories, physical infrastructure, etc. – and more into trading money with money. Even shops that are supposed to be selling goods they have now become omashonisa. Many furniture shops for instance today make more money by lending you money, than from the furniture they sell.

Perhaps the best illustration of financialisation can be told through the story of "Nthabiseng" who has for the past fifteen years been working as a cashier at the till of a big supermarket at Rustenburg Mall. When she started 15 years ago all she was doing was to take money for the goods bought by customers. But today she is also a bank teller as people can take loans at supermarkets and withdraw money from the till points; she is also now like a passenger service agent at an airport counter as you can today pay for an airline ticket at the counter of a supermarket. As a small, but important diversion, Nthabiseng started as a full time employee directly employed by the Supermarket, but now is a casual worker contracted by a labour broker with no benefits, yet doing the job of four workers all at the same time – a classic mix of the capitalist labour market and financialisation!

What is the nature and extent of the problem?

The ANC government, despite the many challenges we have, has done relatively well in terms of investment into infrastructure, with the Fourth Administration, led by President Zuma, investing R1 trillion rand in five years. This has helped somewhat in cushioning our country from the worst of the impact of the global capitalist crisis that erupted in 2008.

The SACP is however concerned that not enough resources in the private capitalist financial sector is going into investment into infrastructure, manufacturing, SMEs or co-operatives. Instead too much of its resources is going into financing shopping malls and consumption. Financing for industrialisation and infrastructure, SMEs and co-operatives will be at the centre of the campaign we are launching today. Such financing will play a big role in creating the much needed jobs in our country.

The National Credit Regulator has just released a report that South Africa has reached its highest levels ever in terms of people with impaired credit records. All because of the drive to make profits at any cost by finance and financialised institutions, including through reckless lending.

It is estimated that there are 19 million credit active South Africans who have such impaired credit records. More than 11 million were categorised as over-indebted.

The loans and high interest rates that millions of our people owe means that they are more working to pay banks and micro lenders than to look after themselves, their families and meet their basic needs.

The SACP is not opposed to credit for productive use and investment. What we are opposed to is reckless lending practices that result in indebtedness and over-indebtedness for nothing but consumerist spending.

In the housing sector, it is estimated that around 10,000 homes are being repossessed by the banks annually in South Africa. This level of eviction can only be comparable to apartheid-era Group Areas removals. The homes are then sold at auction, very often at a fraction of their market value. Worst case scenario involved a house sold at R10 and a house taken away for nothing but corruption involving the concoction of title deeds the owner was disposed and jailed for a while. All this is inhuman.

What does the SACP want?

The SACP will raise with the Treasury the whole issue and processes relating to bank repossession of people's houses with a view to instituting an investigation into the state of affairs in this regard. The SACP is calling for corrective regulatory and legislative steps to build a humane system of handling these matters in a way that puts people first!

The SACP will also be requesting Chief Justice Mogoeng Mogoeng to also institute an investigation into the whole process of authorisation of house repossessions, as our own campaigning on this front indicates a lot of corruption in some of the Magistrates Offices on such matters.

The SACP is also calling upon the National Economic Development and Labour Council (NEDLAC) to convene the second financial sector summit early in 2016. It is now just over a decade since the first summit was convened. It is important that a comprehensive review is conducted to assess progress in order to determine the way forward. 

Through the financial sector campaign, the SACP is pushing for a new financial sector architecture.

We are pushing for a financial sector and banks which will serve the people!

We are pushing for an end to private monopoly domination of the banking sector!

We are calling for diversity, for a greater enabling environment for the development of workers and people's co-operative banks.

We are calling for decisive action to develop a state-owned bank!

We are calling for the differentiation of that bank as well as the Post-Bank from ordinary commercial banks. The state and Post-Bank entrusted with a developmental mandate should not be subjected to the same set of regulation that apply to commercial banks.

We are calling for more investment in the Post-Bank, for the further development of its capacity, for its diversification and full licencing.

The state must direct its financial transactions, including social grants away from corrupt tenders such as the Cash Paymaster into the Post-Bank.

Build on the past gains of our Campaign

After the launch of our financial sector campaign exactly 15 years ago in 2000, the campaign notched a number of victories which we must build upon and deepen. It is important that we remind ourselves of some of these:

- The building of an SACP-led Financial Sector Campaign Coalition (FSCC), made up of more than 50 organisations with an interest in a transformed financial sector to serve the needs of the workers and poor of our country. But one important part of this achievement was that it was supported by sections of especially black professionals and the black middle class.

- We won a whole raft of legislative measures, including the establishment of the National Credit Regulator, the Co-operative Banks Act, and the regulation of the conduct and activities of the Credit Bureaux.

- The establishment of Umzansi Account to expand banking services to the unbanked.

However some of these gains have been rolled back as a result of the fact that our victories led into lengthy processes of policy engagements, and boardroom type activities, thus demobilising the campaign in social mobilisation. All Party structures must revitalise the social mobilisation in the streets, in the communities and everywhere people are, in earnest.

Free the media!

Yesterday, 3 October, working in collaboration with other stakeholders that are interested in media transformation and our allies, we concluded a media transformation summit. The summit, which started on Friday 2 October, concluded with the adoption of thoroughgoing resolutions which will soon be published, and a detailed declaration.

There are six key focus areas we have agreed to make our top priorities in pushing for the transformation of the media:       ownership; management control; media content diversity; accountable media; workplace transformation, skills and employment equity; radical economic transformation of the media.

Ownership of South Africa’s media today is among the most concentrated in the world, despite the fact that all empirical research shows that ownership concentration negatively affects democracy, diversity of perspective and even digital access. An apartheid era company, Naspers, a company that refused to appear before the Truth and Reconciliation Commission concerning its complicity in colonial oppression and apartheid, is dominant in the media. Reports suggest that it has also colonised the SABC, our public broadcaster.

The invaluable heritage of SABC archives has been handed over to Naspers’ Multichoice for peanuts, with conditions that have the effect of denying millions of South Africans access to those archives unless they enrich Multichoice by subscribing to DSTV boxes. 

All of this monopoly must come to an end!

We will not talk and talk forever while doing nothing in practice to change the world!

With our newly launched media transformation campaign we are marching forward to action!

We are forging ahead in building a broad social movement for transformation in the media!

We are forging ahead to tackle corruption in the media as elsewhere in our economy!

We are marching ahead to tackle corporate and private monopoly capture, perceived or real, of state policy direction!

In 1994, we have inherited the SABC that was an apartheid state broadcaster. The distribution of its radio stations’ signal was compartmentalised and drawn up according to the policy of Bantustanisation.

The Tswana radio broadcasting signal was therefore not made available in Cape Town. So were the Pedi, Tsonga, Venda, Ndebele, Sotho, Swati, and Zulu radio broadcast signals. The Xhosa radio broadcast signal, similarly, was not made available in other areas. The only languages where there was investment for a signal to reach everywhere in the country are Afrikaans and English. That was apartheid.

At the media summit we had to pose the question:

Where are we today?

Unfortunately, much of the apartheid status quo in terms of radio signal distribution remains intact. This must come to an end!

All official languages must be accessible from everywhere in the country!

Because we have emerged from the media transformation summit with detailed resolutions and commitment to concrete actions and activities, we will stop here on this important issue of media transformation and return to its in concrete action on the ground!

Unite the working class, our communities, and our movement!

Today, as the SACP, we would like to issue a stern warning, to those who have developed a factional appetite to gamble with the unity of our movement and the alliance!

Such reactionary politics can only serve to delay and derail our national democratic revolution from achieving its historical mission – the completion of political liberation of our people, Africans in particular and black people in general, majority of whom is the working class, and the social and economic emancipation of all the exploited and of women from patriarchy.

There are important struggles we must all unite to pursue rather than degenerate our movement into something unknown in its DNA, something that will only destroy and dislodge it from power!

We must unite against private monopoly capital not only on the financial sector but in all other sectors of our economy, in all terrains of struggle and power!

The SACP will continue to focus on this revolutionary task to unite the working class, our communities, and our movement!

The SACP fully supports all principled worker struggles including the current bargaining campaign by the National Union of Mineworkers (NUM). We will not only pledge solidarity through statements. The SACP will be there in the active participation should the union declare action!

We will do so in a principled manner fully appreciating and sensitive to the fact that we are not a trade union but a working class political party. We will therefore put to the front the common interests of the working class movement as a whole!

On the 7th of October, the SACP will join COSATU’s action in active expression of solidarity against the jobs bloodbath declared by the mining and steel bosses, SASOL and other companies in different sectors.

We will be there to advance the campaign for banning of labour brokers!

We will be there to advance the campaign for affordable, accessible, safe, reliable and integrated public transport system!

We will be there side by side with COSATU, face-to-face and toe-to-toe with the bosses!

Go build a larger but qualitatively strong SACP

In order to achieve all these tasks, this period calls for the building of an even larger, and qualitatively stronger SACP.  Let us go and recruit members into our Party. But let us also focus on the quality of our members.

We need communists who embark on both political education for members as well as active participation in Party campaigns. All members must be steeled both in revolutionary theory and revolutionary practice through active participation on the ground in Party campaigns to change the world.

Let us not recruit people who have an axe to grind from our Alliance partners. But we need committed communists who want a socialist future for our country and the world.

It is also important that we build a large Young Communist League. Remember that, unlike the SACP, the YCL is a mass formation that must seek to attract as many members as possible and to educate our youth about the evils of capitalism, the necessity of socialism and that must train them to become communists.

All Party structures, as we embark on the Red October Campaign, must also focus on building of the YCL.

Issued by Alex Mohubetswane Mahsilo, National Spokesperson, SACP, 4 October 2015