Unemployment rates in South Africa remain stubbornly high, and rural areas are the worst affected. In response to the persistent and structural nature of unemployment, government established two public employment programmes (PEPs): the Expanded Public Works Programme (EPWP) and the Community Works Programme (CWP). The high priority that government attaches to PEPs is shown in their increased funding, which is growing faster than most programme budgets.

The Financial and Fiscal Commission (the Commission) carried out a study to ascertain the effectiveness of the PEPs in creating jobs especially in rural areas and in providing value for money. The study found that the nature of the PEP activity being funded has a critical bearing on the impact of expenditure.

The infrastructure sector has the highest costs and lowest labour intensity, implying that an infrastructure-led growth approach may not result in the required jobs. However, the cost of creating jobs is lower and labour density is higher in the CWP and the social and not-for-profit (NPO) sectors of the EPWP than in other sectors. The Commission recommended that these PEPs/sectors be used as an explicit strategy for addressing rural poverty.

Report by the Financial & Fiscal Commission