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Date : 25/05/2005
Source: T Mbeki: The Presidency
Title: Mbeki: The Presidency Dept Budget Vote 2005/2006


  Speech of the President of the Republic of South Africa, Thabo Mbeki, on the occasion of the Budget Vote of The Presidency: National Assembly, Cape Town

Madame Speaker and Deputy Speaker
Deputy President of the Republic
Honourable leaders of our political parties and Honourable Members of Parliament
Ministers and Deputy Ministers
Directors General, Advisers and Senior Officials
Distinguished guests, friends and comrades

The Chief Whip of the Majority Party, the Hon Mbulelo Goniwe, has informed me that we have in the gallery a delegation from Cradock, the hometown of the outstanding patriot, the Rev James Calata. I am pleased to welcome them to the House and this debate. I hope that their presence in the National Assembly will help them to gain a better understanding of the important work done by the Honourable Members and inspire them actively to act with our National Parliament in future.

Today, May 25th, is Africa Day, which many of the peoples of our continent have marked for over four decades as a public holiday, to honour the establishment of the Organisation of African Unity (OAU) in 1963 and celebrate the African dream. I am therefore pleased to take advantage of this opportunity to convey our best wishes and a message of solidarity to our fellow Africans everywhere, including those in the Diaspora.

The establishment of the OAU 42 years ago constituted an important statement that the peoples of Africa share a common destiny. This inclusive intergovernmental institution was charged with the responsibility to promote the unity of our continent and lead us on the long road to the total liberation of Africa, and its successful development in conditions of peace, stability and democratic rule.

In this context, we would like to reiterate our thanks to the peoples of our continent for their unwavering support for our struggle to end the apartheid crime against humanity and achieve our liberation.

Once again, we would also like to thank our fellow African Heads of State and Government for giving us the honour to host the Founding Conference of the African Union (AU) during the year of the 90th Anniversary of the oldest liberation movement on our continent, the African National Congress (ANC).

Africa has charged the AU with the task to take the work of the OAU to a higher level. By linking its establishment in 2002 with the founding of the ANC nine decades earlier, Africa’s leaders made the statement that as our continent had united to realise its total liberation, so would it use this historic achievement to unite and address the challenges of peace, democracy, development and ending Africa’s marginalisation among the community of nations.

The holding of the Founding Conference of the AU in our country also underlined both that we share a common future with the rest of our continent, and that we have a responsibility to contribute whatever we can, towards the realisation of the new goals that Africa has set itself, as reflected in the Constitutive Act of the AU.

These goals constitute a directive to the contemporary African state. They underline the fact that the state is not an end in itself, but a social institution established to carry out various tasks. Our own Constitution also serves this purpose.

On the role of The Presidency and the Executive, this Constitution says, “The President is Head of State and head of the national executive ... The executive authority of the Republic is vested in the President. The President exercises the executive authority, together with the other members of the Cabinet by ... (among other things), developing and implementing national policy.”

Because of these constitutional provisions and the actual imperatives we face, we would like to dedicate this address on the Budget Vote of The Presidency to the issue of the role of the state in our process of reconstruction and development. We do this fully mindful of the need to maintain the necessary and dynamic balance between the state and the private sector.

Our presentation will include some reflections on what we have to do to position the state so that it contributes effectively to the realisation of the goals of building a winning nation, pushing back the frontiers of poverty and ensuring a better life for all.

The efforts of the Executive in this regard will be greatly enriched by such contributions as the Honourable Members and our National Legislature as a whole may make, both during the discussion of the Budget Vote of The Presidency, and afterwards.

The 17 May 2005 edition of the Financial Times, published eight days ago, carried an article discussing the issue of the role of the state, drawing on recent and current developments in Latin America. Among other things it said:

“The role of the state – which policymakers were trying to cut back for most of the 1990s – is undergoing a rethink ... There is now pressure for the state to play a bigger role ...

“There is a growing belief that the public sector should be strengthened and work in harness with the private sector. In its own study, the IMF concluded that ‘an improved and strategic role of the state is essential. Corruption and weak governance in Latin America have tended to undermine market activity, with the resulting burden falling heavily on the poor’.”

Most interestingly, the Financial Times quoted one of the principal architects of the so-called Washington Consensus, John Williamson, which had set the stage for the reduction of the role of the state, in favour of the market, as saying:

“I’m not an enthusiast for the minimum state. You can’t get away from the fact that it has to play a more active role, but I don’t see an alternative ideology.”

Recognising the critical importance of this issue, the World Bank devoted its 1997 World Development Report to the topic, “The State in a Changing World”. After discussing various developments up to that point, leading to a reduction of the role of the state, the World Bank said:

“Many have felt that the logical end point of all these reforms was a minimalist state. Such a state would do no harm, but neither could it do much good. The Report explains why this extreme view is at odds with the evidence of the world’s development success stories, be it the development of today’s industrial economies in the nineteenth century or the post war ‘miracles’ of East Asia. Far from supporting a minimalist approach to the state, these examples have shown that development requires an effective state, one that plays a catalytic, facilitating role, encouraging and complementing the activities of private businesses and individuals. Certainly, state-dominated development has failed. But so has stateless development – a message that comes through all too clearly in the agonies of people in collapsed states such as Liberia and Somalia. History has repeatedly shown that good government is not a luxury but a vital necessity. Without an effective state, sustainable development, both economic and social, is impossible.”

From the very beginning of the democratic order, we recognised the fact emphasised by the World Bank, that our “development requires an effective state” and that “without an effective state, sustainable development, both economic and social, (in our country) is impossible.”

Commenting on this issue on 30 June 1999, and speaking from this rostrum, we said that the poor in our country, the disempowered, require a strong state to redress the imbalance of power that derives from our history and the fact that we have a relatively well-developed capitalist system.

The Financial Times article, to which we have referred, said the burden arising from corruption and weak governance in Latin America has “(fallen) heavily on the poor.” Similarly, we argued in 1999 that a minimal state in our case would further increase the burden of poverty and marginalisation already carried by the poor of our country.

Specifically we said, “Behind all the words we have quoted, is the fundamental idea that everything must be left to the great leveller, the market, which is driven by the notion that 'self regarding interest is predominant over social interest', as Jeremy Bentham put it.

“In our own specific situation, what this means is that those who are fittest to survive will survive. Those who are best abled will qualify on the basis of merit. Those whose race defined them as sub-human must now have no access to state support which state must, after all, retreat to allow those who have the means to survive and dominate, dominate.”

Our development model therefore includes the fundamental proposition that we need a strong state to achieve the sustainable social and economic development to which the World Bank referred. This is as true of our country as it is of all other African countries and other developing nations.

Given the serious development challenges we confront, focused on ending poverty and underdevelopment and the racial and gender disparities in our country, as well as bridging the development gap between ourselves and the countries of the North, we have thought it necessary that we undertake a critical assessment of the organisation and capacity of our democratic state.

When we delivered the State of the Nation Address earlier this year, we announced that we had asked our Forum of South African Directors-General (FOSAD) to carry out this work. As the Honourable Members are aware, earlier this month the Cabinet discussed the FOSAD Report at a meeting attended by Deputy Ministers, Premiers and the national and provincial Directors-General, and asked FOSAD to do more work on this issue.

Reflecting the challenges we face, given our history and therefore the legacy that democratic South Africa inherited, our Constitution prescribes that the democratic state has to pursue such objectives as:

* healing the divisions of the past;
* ensuring our unity in diversity;
* guaranteeing the equality of all our people across racial, gender and other divides;
* protecting the dignity and freeing the potential of each person;
* improving the quality of life of our people; and * ensuring social justice for all.

Necessarily, the review of the functioning of the democratic state must assess whether it is organised and has the capacity to carry out these tasks. Success in this regard is fundamental to the very stability and viability of the democratic state and is therefore being addressed by the FOSAD process as one of its most critical challenges.

Having achieved our liberation some time after the liberation of all African countries, with the exception of Western Sahara, we have the advantage that we can learn from our continent’s experience, to understand the importance of respecting the constitutional goals we have listed, to ensure the stability and viability of our democratic state.

The passage from the Report of the World Bank, which we cited, mentioned the reality of failed states, such as Liberia and Somalia. This must focus our attention on the failure in these countries to address the centrifugal tensions that ultimately led to the seemingly irreconcilable conflicts that caused the collapse of these states. Nothing that is happening or has happened in our country suggests that our new democracy is threatened by such an eventuality. Indeed, many at home and abroad have noted the remarkable national cohesion we have achieved despite our past and continuing reality of deep-seated racial, gender and socio-economic divisions.

However, this should not serve as cause for complacency. There are various matters that arise as part of our daily reality, which indicate the fault lines that can emerge and generate conflicts that we do not need.

I refer here to such issues as:

* the few demonstrations we have seen in some of our municipalities, apparently driven by feelings among some among the poor that so far, the democratic order has failed them;
* the political mobilisation based on the assertion that the democratic order is focused on denying the Afrikaner people their identity and legitimate rights; and,
* attempts to mobilise the Zulu-speaking people on the false basis that they share so-called ‘national interests’ different from the interests of other South Africans.

We can say with confidence that none of these instances present any immediate danger to our democracy. But they do reflect and seek to exploit the class and nationality fault lines we inherited from our past, which, if ever they took root, gaining genuine popular support, would pose a threat to the stability of democratic South Africa.

I mention all these to make the point that one of the tasks of the FOSAD process is to address the capacity of the democratic state to ensure our national and social cohesion, consistent with the prescriptions in our Constitution, and the fundamental task to build a democratic South Africa that belongs to all our people, united in their diversity.

In this regard, bearing in mind our involvement in the process of Africa’s renewal, we must mention that it is clear that the peace and stability the peoples of Africa seek has to be based on the national and social cohesion we strive to guarantee for ourselves.

The absence or weakness of this cohesion gives an impetus to the centrifugal tendencies to which we have referred. Understandably, these will be stronger in the national states created by colonialism, and kept together in the past by the power of repression exercised by the colonial power, an experience shared by almost all the African states.

Africa’s search for peace and stability, and therefore the creation of the necessary conditions for development, means that Africa and the AU should consciously confront this challenge. Our own support for Africa’s process of renewal means that we must develop the skill and sensitivity to work with our sister African countries to achieve such social and national cohesion in all the countries of Africa.

The experience in many of the countries in which we are and have been involved directly confirms the correctness of these conclusions. Among others, this relates to the Comoros, Burundi, the Democratic Republic of Congo, C

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