SPEECH BY MINISTER JAY NAIDOO DEBATE ON THE BUDGET VOTE OF THE PRESIDENT: 22 AUGUST 1994
We all owe a vote of thanks to our President for the greatest triumph of his first 100 days: the rallying together of all South Africans behind a programme for the Reconstruction and Development of our country. It is rare for a new government to have a coherent plan: it is even more rare for a nation to unite so quickly and so comprehensively in support of the plan.
The major goal of the RDP is to eliminate poverty, raise the standards of living of all our people and create strong and rapid economic growth.
We can't eliminate poverty in a sustainable way just by throwing money at it. It requires a transformation of all aspects of our society. That is why we are looking at both the long-term and short term programmes of the RDP.
The President announced a set of projects in his speech on Thursday opening this debate. These projects will stand or fall on their ability to start the process of transformation. A major shortcoming of the projects to date is that we have not linked them to economic restructuring. We have focused on areas of desperate social need: now we need to ask how to use the comparative advantage created by very large investments in infrastructure and service industries and our small business sector. The electronics industry has already taken this approach.
Urban renewal projects such as that which we are planning in Botshabelo are really sustainable only if we simultaneously pay serious attention to the regional economy. This includes analysing comparative advantages and looking seriously at industry, tourism, agriculture, technical education facilities and other factors. We should avoid a damaging competition based on cash incentives to attract industry.
The public enterprises are playing and will continue to play a vital role in the RDP, by providing efficient and affordable services and infra-structure to our people. Privatisation will not make them more efficient, and could result in more expensive electricity, phone calls, water and transport. We should continue our efforts to ensure that our public enterprises become even more efficient and more responsive to the needs of the people through the RDP rather than sacrificing long-term assets for a short-term benefit.
However, government owns many assets which are not properly used, including a great deal of property, projects and buildings. Departments and tiers of government should review their assets with a view to selling those which are not effectively used.
I believe, with the President, that we can justifiably claim to have made good progress within the first 100 days in the implementation of the RDP. After 350 years of colonialism and apartheid, we have in the first 100 days focused this government on national network. All training must comply with the National Qualifications Framework so that trainees can utilise it for their career development.
All projects must maximise community involvement, to ensure that communities have a sense of responsibility and "ownership". That means that communities and mass-based organisations must be involved right from the planning stage.
In many ways these projects will be a learning experience. They will allow us to develop acceptable and efficient models of development which will greatly facilitate further delivery in year two and later years.
The Cabinet has approved these "Lead Projects" in principle, subject to two processes:
First, the carry-over costs for each projects, and the recurrent expenditure it will generate, are being assessed by the Central Economic Advisory Services and the Department of State Expenditure, to ensure that these costs are accommodated in the 1995/96 and 1996/97 Budget. This is a two-way process: it will involve modifications to the projects, but it will also involve changes to the Budgetary allocations, and so will accelerate the process of bringing the budgeting procedure in line with the RDP.
In the long run, of course, this will require a multi-year Bgt based on defined programmes, each having key performance indicators. That will be a major change from the present single-year Budget based on increments on historical allocations.
Secondly, each project requires a detailed business plan. This plan must include a work breakdown, cost breakdowns, quality programmes an audit trail, job creation, affirmative action and training procedures, community involvement and so on.
Standard formats are currently being prepared to assist the project management teams.
The requirements should become standards for all government spending, allowing tight control on spending and ensuring that projects can easily be assessed and audited.
On completion of the business plan and the Budget analysis, a performance agreement will be drawn up between the community and/or local authority, the provincial government, the national line department and myself.
We are also analysing other funding options. An inter-departmental team has been meeting the embassies and multi-national organisations to prepare a detailed breakdown of the grant aid and other development aid packages on offer.
The CEAS and myown staff, with the Departments of Finance and State Expenditure, are now analysing the financial packages for each project, in order to optimise funding and cash flow.
A part of this process will involve the rationalisation of the development financing agencies in South Africa. Unless this is done, it will be very difficult to integrate them into the process of optimising project funding. We will also prepare guidelines to assist in the co-ordination of departmental and provincial funding activities.
The non-governmental organisations clearly have an important role to play in this process. We have convenearw-eecference of NGO's to seek ways of co-ordinating efforts, optimising use of resources and adding value.
As well as redirecting government expenditure to new priorities, we are using the Lead projects to assist the process of redirecting the resources of government, and especially of the civil service. Cabinet has agreed that projects must be serviced as far as possible without increasing staffing levels in the civil service. Clearly, there will be an affirmative action programme, but the existing civil service must be redirected from its old activities to the new activities required by our projects and programmes.
In summary then:
We have begun the process of redirecting government expenditure and use of resources at all levels.
Funds will be released for the Lead Projects as the business plans become available. These are at different stages: some are well advanced. Funds will be released in tranches as required, not as lump sums.
Lastly, I wish to deal with the issue of social partnership. There are many constraints in the way of the successful implementa- tion of the RDP. The focus of the partnership must be that together we identify these constraints, and as a nation we require the major players to come together in each area where a constraint exists and to strategise TOGETHER on how to overcome this constraint.
That is what a social accord is based on: the key constituencies agreeing from time to time on how to overcome a particular obstacle. A social accord is definitely NOT a big, thick document that we negotiate and then we all sign and it binds us.
This approach of committing ourselves as a nation to overcoming obstacles is the key to the success of the RDP. It is a dynamic process and an ongoing process. New constraints on delivery will appear as we progress and as we learn more, and we must be prepared to work together to resolve them as they arise.
The RDP cannot work without the full commitment and involvement of civil society: labour, business, community based organisations and NGO service organisations. We cannot claim to fully involve communities and the public only through structures of government.
In this connection, we welcome the proposal from the National Union of Mineworkers to contribute pay for days worked to the RDP. Their proposals should be discussed by business and labour to see whether a viable proposal for contributions from both sides can emerge. We look forward to a positive result.
This emphasises that there are both benefits and responsibili- ties for all sides in the RDP. Business will have great opportuni- ties as investment increases, but they have a responsibility to keep prices down, to improve efficiency and design capability, to commit themselves to fair employment practices and to major skill develop- ment programmes. The unions will benefit from the improved services and infra-structure and training, but they must take joint respon- sibility for developing industrial strategies for greater efficiency and improved export capability. The members of the civics will bene- fit, but they must take responsibility for ensuring that projects are managed without corruption, without vandalism and with the payment of affordable user charges.
Our President's moral authority provides the drive to achiev hgi ioall prograeWu ree need for change. Let us not hide behind so called "professional stand- ards" which too often becomes used as an excuse for "business as usual".
Being a unionist I became used to the phrases "continuous improvement" and "do it right the first time".
We are servants of the people. Our President has called for us to set an example to the nation of frugality. He has called for the belt-tightening - we must be the first to do so. We set the tone - if we fail to respond to the President's call, then we expect differently from the civil service or the nation.
In conclusion - we have a vision. The people have a dream. That vision is the RDP - our task is to fulfil that vision. Nothing more nothing less.