Policy debate to hot up in next few years

12th March 2010 By: Aubrey Matshiqi

In whose lifetime will the nationalisation of mines happen? The fact that you are an avid reader of this column suggests that Father Time will harvest you long before the African national Congress (ANC) Youth League turns its threats of nationalisation into government policy. If you are a reader of this august publication and are as young as the young lions of the ANC, do not make the mistake of thinking you will reap some policy advantage from your age.

Unlike the markets, I am not easily intimidated. I have no doubt that one has to be reincarnated an infinite number of times before one can taste the fruit of nationalisation. If I am correct, why are we even having this debate?

The answer lies in the fact that the next three years will deliver three significant policy milestones.
In September this year, the ANC is holding its national general council (NGC). The NGC is a midterm conference of the ruling party, the task of which is to review policy and the performance of government since the last election. In case you have forgotten, the last NGC was held in June 2005, and key policy proposals were rejected as part of a broader rebellion against Thabo Mbeki, given the fact that he had axed Jacob Zuma as Deputy President of the country a few days earlier. This year’s NGC is important because it will signal possible policy changes. Further, it is an opportunity for those who seek to shift policy away from the centre to win the policy battles they lost in the past. The NGC will also give us an idea of the extent to which Zuma is still in control of the ruling party. Also, we will be able to assess whether he has enough support to remain a frontrunner in the 2012 battle for the presidency of the ANC.

The second milestone is the 2011 national policy conference of the ANC, where the policy framework for the period 2014 to 2019 will be crafted. This policy framework will be endorsed at the national conference of the ruling party in December 2012, and this constitutes the third milestone in the policy agenda. This third policy milestone is of special significance because the ANC celebrates 100 years of its existence in 2012 and the country will, in 2014, celebrate 20 years of democracy.

Current debates about the nationalisation of mines and the South African Reserve Bank must be understood in terms of these three milestones.

However, these milestones are not only of significance in policy terms since they are also about the consolidation of the political gains that were made in Polokwane. They will, therefore, give us indications of how the balance of power and support may be reconfigured in the months leading up to the 2012 conference of the ANC. As matters stand at the moment, Zuma’s position is not as secure as it was a year ago. Policy contradictions between his administration and his left-wing allies in the tripartite alliance are beginning to sharpen. The content of both the State of the Nation address and the Budget speech showed very clearly that it would take a huge effort on the part of the South African Communist Party (SACP) and the Congress of South African Trade Unuions (Cosatu) to move ANC policy left of centre.

The left-wing rhetoric of these speeches was not matched in any way by what Cosatu and the SACP regard as left-wing policy measures. In fact, the Budget speech succeeded in promising a new way of doing things in the post- recession economic and political setting by maintaining old and trusted policy remedies.

It would be remiss of me not to state that the Minister of Finance, Pravin Gordhan, in response to arguments about the deficit between rhetoric and actual policy, indicated that the Budget was propoor to the extent that the spending momentum on items such as education and health was being maintained.

But, if these allocations are indicators of propoorness, then propoor Budgets have been with us since 1994. In fact, the content of our Budgets has, since the advent of democracy, been pro-poor but the outcomes have been preponderantly antipoor. So the President must focus on both outcomes and Budget allocations if he is serious about an ‘outcomes-based’ approach to governance.

In other words, the ANC government must work towards a proper alignment between Budget allocations and outcomes. This is what the policy debate should be about over the next three years. And it should be about the nature of the constraints that will be imposed on the State by the fact that the new instruments that Zuma has created will, for some time, be unable to deliver optimally since they will be creating internal capacity for themselves.