Schools and local government are not delivering the results that South Africans need to overcome the recession and the ravages of apartheid, President Jacob Zuma said on Thursday.

Zuma told the National Council of Provinces that a large slice of the population lacked the skills they needed to find employment, leaving them jobless for years at a time.

"Though it absorbs a significant amount of our budget, our education system does not produce the outcomes we require," he said.

He said his administration has chosen to respond to the global economic crisis not by propping up banks and businesses, but by correcting long-standing problems, many of them part of the legacy of apartheid.

"The steps we need to take to respond to the recession cannot be separated from the longer term task of transforming our economy and society," he said.

"That is why we borrow not to bail out banks and failing businesses, but to invest in economic infrastructure, education, health care, rural development and the fight against crime."

He said the government therefore saw the economic crisis as an opportunity "to improve the operation of government and ensure that it better utilises scarce resources".

Fifteen years after the advent of democracy, it was clear that local, provincial and national government had not lived up to the call of the Constitution to cooperate in good faith and coordinate policies.

"More often than not, the three spheres of government pull in different directions."

After a spate of often violent service delivery protests, his administration has admitted that there are serious problems of incompetence and corruption at local government level.

He said renaming the Department of Provincial and Local Government in May to that of Cooperative Governance and Traditional Affairs, was therefore not a cosmetic gesture but a signal of intent to create efficient, cohesive government.

Western Cape Premier Helen Zille said in her response to the President's address that it was "ironical or hypocritical" as the national government was constantly trying to undermine efforts in the province to deliver services to the poor.

She said it was part of a campaign to discredit the Democratic Alliance and warned that if it persisted, her party would take the matter to the Constitutional Court.