South Africa

2021 LOCAL ELECTIONS

Thabo Mbeki calls for social compact to eradicate poverty and unemployment

Former president Thabo Mbeki. (Photo: Gallo Images / Darren Stewart)

‘We must say to the ANC, this is what you promised in your manifesto… and social partners have already produced a vision and a plan [to rescue the economy],’ Mbeki said.

Former president Thabo Mbeki said on Thursday night that a social compact should be agreed upon and implemented to eradicate poverty, inequality and unemployment in South Africa.  

Importantly, this should be done in the form of a commitment — that demands results — instead of a promise, he said.  

“This social compact that must produce this plan to eradicate unemployment, poverty, and inequality… some things have already been done. What is outstanding is that the social partners must get together to say, ‘We have some vision of where we want to go, and let’s make this into an implementable plan.’ That is what is missing.” 

Mbeki was speaking at an ANC-sponsored event at the Inkosi Albert Luthuli International Convention Centre in eThekwini. The audience included captains of industry, business owners, academics, NGOs, politicians, ANC affiliates and unions, community leaders and residents.  

He referred to the release, in 2020 by Business for South Africa (B4SA), of a 111-page presentation outlining a proposed economic response to the Covid-19 pandemic.  

The plan required policy interventions and could increase GDP by R1-trillion, create up to 1.5 million jobs and increase tax revenue by R100-billion per annum. 

According to the proposal, the private sector would need to commit funding of R1-trillion. B4SA said if the plan was adopted, GDP would, by 2030, increase from $330-billion to $550-billion, unemployment would shrink to 15%, business confidence would increase 14-fold and global competitiveness would more than double.  

The plan included a 12-point key policy focus that included tackling corruption, improving ease of business, state-owned entity rationalisation, clarity on land reform, simplifying mining regulation and reviewing trade policies. 

Mbeki said this was the first time since South Africa entered its democratic era in 1994 that the meaning of “social partnerships” was realised, when society was “speaking in one voice about one thing”.  

It was an extraordinary commitment, he said.   

Few would disagree that the South African economy and local government were in a crisis, he said, and that corruption had a direct result on how national resources were being managed. 

Such things were included in the election manifestos of almost all of the political parties that he had read, said Mbeki.

“Our economy is in crisis. Those jobs will not come if we don’t attend to the economy. Let me read a commitment which the ANC makes in that regard [in its manifesto]: ‘We must urgently finalise the social compact with the social partners to achieve our social transformation to eradicate poverty, inequality and unemployment’. 

“I like to believe this is not a promise, but a commitment. I think all of us have clearly followed developments in the country regarding [the economy]. All of us as South Africans should take this up with the ANC. 

“We must say to the ANC, this is what you promised in your manifesto… and social partners have already produced a vision and a plan [to rescue the economy],” he said.  

Of the governing party, he said the ANC had long been warned that those joining for obvious self-enrichment should not have been allowed access: “We failed to deal with this problem.”  

“These people [eventually increase in number] and they are bound to affect the quality of the party. At Nasrec in 2017, we said there must be renewal, or it will become a matter of life and death for the ANC.  

“The ANC understands that if it wants to exist, it must renew itself. That renewal will give us the passion that is needed in governance. 

There are commitments that have been made by the ANC… we owe it to ourselves to say that the ANC must live up to those commitments. If the ANC doesn’t correct itself in that context, the country is in trouble.” 

Local government had to be approached in a “rational and intelligent way” he said, touching on the District Development Model (also mentioned in the ANC manifesto) which speaks to better coordination between local and district municipalities. 

Using eThekwini metro as an example, he said: “Two years ago, in terms of capital budget, something like 43% came from own resources generated by the municipality. Then take the OR Tambo [ORT] District Municipality in the Eastern Cape. For the same year, the same period, the amount of money for capital investments generated from local resources was 1%. 

“You can’t conceivably think ORT is going to develop, so what are we going to do? Financing of local government can’t all be the same. One proposal is that the Development Bank of Southern Africa [DBSA] — one of the biggest financiers of local government and metros — should concentrate on these districts that can’t raise the funds themselves.  

“eThekwini can issue municipal bonds, but ORT can’t. So why don’t we get the metros to take care of themselves? And resources from the DBSA can go to municipalities that can’t survive.”  

More resources were needed to finance development in local municipalities, he said, and citizens had to be informed of what was being done to generate this.  

“This challenge to get social partners together is critical to that. As is cleaning up local government. You can generate huge resources, but if you don’t have a value system, those resources will disappear into people’s pockets.” DM

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All Comments 5

  • This is a bit rich coming from him. The catastrophic corruption that defines the ANC today started under his administration. It is more than a little arrogant to think they can insinuate themselves to be part of the solution by default when they are, at the same time, the cause of the problem itself.

  • Still working on it a bit but here’s a architecture for a social compact where everyone benefits, everyone contributes equally and everyone benefits equally. It appears to be the ideal for capitalism as well as socialism. Allows you to become as wealthy as you want but everyone also has a job. I am keen for some comment you may need to refresh the home or landing page to make it work.
    website: inournatureism org
    It’s core postulates or axiom are that you own your time and that ownership is absolute as long as you respect Luther rights to the same. It builds on the understanding of justice and value as discussed by the Greek philosophers as well as the enlightenment philosophers of the 1500-1700. I have no formal philosophical education so it has been a interesting process to figure this out. This creates the architecture that allows for a society where there are no general elections, but everyone is able to follow the ideology they choose. It’s a paradigm shift from the current reality that has no singular or core postulate but rather many human constructs or rights, this contract is based on singular natural construct you own your time and the consequences of what you do with it. This ownership comes with accountability and responsibility with recourse for when you commit a injustice. It allows principals that at present are tricky to define in a simple universally accepted, they would be value, justice as well as many others eg free will.
    EVERYONE SHOULD SEE BENEFIT.

  • So still the same thing he’s been saying since the early 2000’s when he was in office. Can the ANC get anything done? The only compact they know is the “you pay, we steal” compact. Damn the ANC and all its incompetent incumbents!

  • Is this not the same so-called ‘intellectual’ who in his arrogance subscribed to and promoted the ‘garlic and beetroot’ treatment for aids ? It ended up costing him his job … for which his ‘successor’ is still making us pay ! Why would anyone with any thinking capacity, today still listen to anything this buffoon has to say ? Primarily … his goal is to entrap us into believing that the almost wholly corrupt ANC can reform itself and is the vehicle for real ‘change’. His best bet is to get out of the ANC … like some of his intrepid colleagues with scruples/ethics have done. This is the same kind of misguided ‘intellect’ that people like Mpofu display.