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Business is the shot in the arm South Africa needs

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Tim Cohen is editor of Business Maverick. He is a business and political journalist and commentator of more years than he likes to admit. His freelance work has included contributions to the Wall Street Journal and the Financial Times, but he spent most of his life working for Business Day. After a mid-life crisis that didn't include the traditional fast car, Cohen now lives in the middle of nowhere in the Karoo.

Who do you want distributing those vaccines – government or the private sector? Be honest.

First published in the Daily Maverick 168 weekly newspaper.

The contorted process of getting and paying for vaccines says an enormous amount about the state of government in South Africa today, both good and bad. Well, let’s be honest, mostly bad.

It also raises another issue: the constitutional and transparency issues involved in the new rapprochement between business and government symbolised most recently by the establishment of the Solidarity Fund.

I should put my cards on the table. Unlike many in the SA commentariat, I actually like the idea of the respectable side of business and the respectable side of government working together, even if this takes place in a constitutional grey area.

Is this the ideal solution? Absolutely not. Given SA’s State Capture history, it’s understandable that citizens are goosey about decisions between business and government taken in the proverbial smoke-filled rooms. There are of course constitutional issues about government outsourcing to business functions it should be performing, like organising Covid-19 vaccines.

Dysfunctional government

The recent review by the National Planning Commission (NPC) shows large swathes of government to be dysfunctional. Jobs have been juniorised, accountability systems are non-existent, people in senior positions are clueless about what they’re meant to do.

One example was the plan to connect government buildings to a digital network. The initial plan, called SA Connect, was approved in 2013. Five years later, essentially the same plan was approved as the National e-Government Strategy. It set targets.

Great.

“Phase 1 of the plan was initiated in 2017/18 and was meant to connect 6,135 government buildings and, to date, has actually connected 970 government sites – mainly clinics and schools. It is not clear whether these sites are operational,” the NPC report notes, a touch sardonically.

A further 35,211 government sites still need to be connected to achieve SA Connect. “It is estimated that doing this would cost a minimum of about R30-billion and potentially up to R80-billion …”

What is behind this dysfunction? The report doesn’t explicitly tread into this marshland, but it’s kinda obvious. The ANC faces no real threat at the ballot box, so the need to demonstrate performance to the electorate is obviated. That has wormed its way into the administration, and SA’s stringent labour laws mean it’s impossible to hold anyone to account. Layer on top of that a corrupt tendering system and financially needy political parties, and you have a full-on crisis of administration.

The private sector engages

President Cyril Ramaphosa knows this. He has experienced first-hand the accountability systems of the private sector, which can be tough. Incentives, negative and positive, are key. Early in Ramaphosa’s presidency, there was an accord between business and government. In some ways, the Solidarity Fund grew from that.

In the matter of vaccines, the Health Department tried to get Treasury to pay for SA’s Covax membership and an initial set of vaccines but was rebuffed. So it went to the Solidarity Fund, comprised of donations, mainly from business and individuals.

The department itself was behind the curve on this but, with the help of the fund, sourced an initial batch of vaccines. From this was born the idea that medical schemes could subsidise the broader population on a one-to-one basis.

Treasury then found its voice, saying it would provide most of the R20-billion required to vaccinate the nation.

So it’s a crazy mix of plans and counter-plans, but the general idea is more-or-less sensible: the government will procure the vaccines, sell them to the private sector at double the price, and the surplus will be handled by the Solidarity Fund, and that will be used to pay for free distribution. Production and logistics will be managed largely by the health companies.

Is this really a constitutional problem? Generally, I’m glad the private sector is engaged. This is how South Africans get things done: public schools declined but private schools blossomed; public hospitals failed but private hospitals grew.

And those who have constitutional qualms, please refer to the government digital rollout above. DM168

This story first appeared in our weekly Daily Maverick 168 newspaper which is available for free to Pick n Pay Smart Shoppers at these Pick n Pay stores.

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  • Aslam Dasoo says:

    Here’s what happens when a government lacking in self-awareness about its capacity and a private sector overly self-satisfied with its ability make common cause with it.
    It doesn’t help when those who would insist that this binary is an extension of the shining successes of large government programmes that are often serial (like in the PPE tender debacle and the spectrum rollout) and, in some instances (like Life Esidimeni), tragic failures, as much as they put on false smiles but in truth chafe at having to work together.
    The most important component of the vaccination programme, mentioned by neither the government nor the private sector, is the people themselves, whose willingness to cooperate with it is decreasing by the day, precisely because they’re ignored while the government falls over itself to cover its backside at its failure in the timely procurement of vaccines and the organised private sector falls over itself as it condescends to work with it.
    Leaving our fates in the little closed-shop arrangements of these two partners won’t end well. It never does.
    Ordinary people are increasingly alienated from the government, resentful of a private sector that struggles with inclusion and rebellious due to the lack of change in their material conditions while their public heritage is negligently squandered.
    The absence of community and legitimate popular voices at the top table where the plans are being cooked up is glaring. And the lack of transparency is fatal for a project of this scale.
    Better to have legitimate voices from civil society, such as the C19 People’s Coalition, with 150 organisations (and growing), rooted in the lives of ordinary people, right at the top table. They have community legitimacy that the government can only dream of and the private sector cannot even comprehend.
    Moreover, the oversight they provide will greatly assist the forensic oversight of an overstretched AG with more than enough state profligacy to deal with.
    Most importantly, their inclusion will coincide with the necessary transparency that the other two partners may find uncomfortable but which is vital for the public to understand and to increase its cooperation with the programme.
    C19’s great lessons are going unlearned. Doing things the same way and insensibly insisting that past experience is a great pointer to success in the future, is not just being economical with the truth, but also increases the risk of harm to the people. Thankfully, no one is buying it, except the government and its private sector partners.

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