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Hundreds of thousands of jobs likely to disappear with Godongwana’s public employment budget cuts


Ayal Belling is a founder of the unemployed movement Organising for Work. He previously worked in finance and technology in London and Cape Town. He is now an organiser for Progress, a new party registered with the IEC, which wants a massive expansion of proven socially and economically productive public employment to guarantee every unemployed South African a work opportunity.

In his Medium-Term Budget Policy Statement, Finance Minister Enoch Godongwana announced an effective cut to the budget of the country’s public works programmes, imperilling hundreds of thousands of jobs per year.

At 33%, almost six times the world average, South Africa’s unemployment is the worst in the world. Despite this, the finance minister announced in his Medium-Term Budget Policy Statement (MTBPS) on Wednesday that he was effectively cutting funds to programmes that, in the 2022/23 financial year, provided public works employment to 1.8 million people. 

He said that to continue to fund the 650,000 jobs per year in the Presidential Employment Stimulus (PES), he has to repurpose funds from the other two major public works programmes. 

Of course, our national purse is under huge pressure, but cutting possibly hundreds of thousands of public employment jobs over other options at a time like this is perverse. There are many wasteful and inefficient programmes and departments where funds could be better repurposed to support public works jobs.

According to Kate Philip, programme lead of the PES, to avoid igniting the tinder box created by catastrophic levels of unemployment, we need to expand, not contract, tried-and-tested public employment that creates jobs right now. We don’t have time, she says, to wait for inclusive growth to create those jobs.

Andrew Donaldson, ex-deputy director-general of National Treasury, would like to see an expansion of our public employment programmes as quickly as possible together with targeted support for labour-intensive industries. He says that supporting an unemployed person with a public works job far outweighs its cost.

Read more in Daily Maverick: MTBPS 2023 is a shoddy compromise that means death by a thousand cuts

As for choosing the PES over the other public employment programmes, it does appear, though, that it is superior in quality. Early research on the PES, the majority of which is education assistants in our 23,000 public schools, shows substantially improved educational outcomes.

Unemployed members of Progress, a new political party that focuses on job creation, also attest to their PES job as having been more fulfilling, higher paid and, at nine to 10 months, longer term than other public employment they’ve participated in.

But they say that after their public employment ended they were left stranded again in long-term unemployment – an experience reinforced by wider research on youth employment programmes conducted by Lauren Graham at the University of Johannesburg. Professor Graham, one of the country’s foremost researchers on youth unemployment, says that the uncertainty participants feel about what they will do after their public employment ends, undermines such programmes.

It is for all these reasons that it is necessary for political parties campaigning for election in 2024 to advance a straightforward plan to guarantee every unemployed South African a work opportunity. This involves a major expansion of public employment along the lines of the PES. Below are some of the key elements of a jobs plan.

A plan for job creation

  • Offer every unemployed South African a guaranteed work opportunity in the form of a half-time job paying R2,200 a month or R2,200 a month to be trained and funded as a micro-entrepreneur;
  • Focus the jobs on socially and economically productive work so that for every R1 spent, conservatively, at least R1.50 to R2.50 is returned to GDP; and
  • Ensure the jobs and micro-entrepreneur opportunities are continuous (one- to five-year contracts), predictable and stable, expecting the programme to reach every corner of the country after three years.

Modelling suggests that such a plan is economically responsible, ensuring that GDP grows faster than public debt. It also enables a vigorous private-sector recovery through the micro-entrepreneur programme and the widely distributed economic base created through so many more people earning a reliable income.

This way enormous human resources could be devoted to improving education, crime prevention, energy generation, housing, rail, roads, walkways, cycling paths, micro-farming and the reinvigoration of our secondary towns.

Such a plan could be funded by several large reprioritisations of the existing national budget – particularly infrastructure. We are also considering new, medium-term, progressive taxes which can, in substantial part, be offset by co-investing in our public employment programmes.

Early next year, Progress, a party that would enter a coalition with any other party that agrees to substantially realise such a work programme, will publish a full set of expert-informed policy positions. However, the central message will always remain: Get South Africa working and we have the best shot at fixing the rest of our problems. DM


Comments - Please in order to comment.

  • Ben Harper says:

    Government should NOT be in the business of creating or providing jobs, Government’s business is to create the environment where businesses can thrive and thus create jobs by doing so.

    Referring back to the exceptionally knowledgeable Mike Schussler (RIP), as far back as 2008/9 there were more people employed by the state or state owned companies than there were in private companies, at the same time there were more people on social grants than there were in formal employment.

    Mike has been proven to be right so many times over and it is more relevant today with the corrupt leeches we have in government, the state should not and must not provide jobs, it is just a vehicle for theft and corruption

  • Steven D says:

    This is obvious electioneering, plain and simple. The writer uses only this single throwaway line – “Of course, our national purse is under huge pressure…” – to acknowledge the existential problem facing South Africa:

    We are running out of money.

    Yet, he wants government to employ MORE people? How will they be paid? Where will the money come from?

  • andrew farrer says:

    What a load of crap! NO substance, just political campaigning. If Ayal disagrees then he can first provide some detail – exactly what jobs, where’s the money coming from etc.

  • Middle aged Mike says:

    Pie in the sky, first year canteen grade twaddle.

  • Confucious Says says:

    The amazing discovery of 20% of the population this year, and the the additional 20% of unemployed people still to be realized! Unemployment must be far worse than reported!

  • Concerned Citizen says:

    What absolute rubbish. You can’t just keep adding more and more government jobs, and expect the magic money tree to cover everything. How is it that we have so many government employees, yet ALL government agencies are totally dysfunctional? They are happy to collect their paycheck, benefits, housing and transport subsidies — all without performing their duties to even the most basic of standards. I know! Let’s INCREASE the number of State employees!

  • Denise Smit says:

    The government and government labour unions caused this themselves by insisting on the sick unaffordable salary increases when the were already earning too much. No sympathy. Denise Smit

  • Ayal Belling says:

    If interested, you can view our modelling on this jobs programme under the link on Progress Party’s home page (progress org za): “An economically responsible plan to realise our jobs programme”. It shows the cost of the programme as percentage of national budget, return to GDP, speed of public debt growth, possible reprioritisations, clawbacks, and new taxes (some offset-able) to cover the cost. It also shows a few focus areas for the jobs part (as opposed to micro-entrepreneur part) that would give a good social and economic return on the work done.

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