Gauteng Provincial Executive Committee 8th Congress 2004

Widening the Minimum Socialist Program

Towards A Socialist Poverty Eradication Strategy For Gauteng

1. Introduction

This document contains a program of action or poverty eradication strategy for Gauteng. It is a platform from which the South African Communist Party in the province would attempt to achieve the following:

  • Take on board lessons learnt from the past three year of socialist practice to build elements of socialism in Gauteng through widening the minimum socialist program;
  • Firm up the fit between the provincial program of the party and the political program of the SACP, its medium term vision and strategy;
  • Clarify the SACP's approach to engaging with and implementing the ANCs election manifesto and the tri-partite alliance more generally;
  • Engage provincial and local government in the province;
  • Serve as the basis for a dialogue with workers in socialist forums, unions and communities;
  • Rally and build momentum in ward committees, local co-operative movements and community food security forums for people driven and led transformation and socialist sustainable local economic development in township communities and informal settlements

The political explanation for this program is contained in the political report. However, this document does set out a set of economic arguments and perspectives to set a basis for the widening of the minimum socialist program in Gauteng.

2. The Poverty Challenge in Gauteng

Poverty Profile of Gauteng
Year
No.
%
1995
1996
2001
2002
2003
Human Poverty Index


12

18


Service Deprivation







Life expectancy


64


51

HIV infection rate




14.2%

16%
7 Basic Services



17324
24074


1 Basic Service



161044
317269


Hunger in the household




1 child under 7






1 person over 7

Informal dwellings




20%


Under R9599 per month

25





0- R4799

10





Poverty rate





20%

Poverty Gap





8%

Gini co-efficient


0.525


0.625

HDI


0.82



0.73

[sources: UNDP Reports, Labour Forces Survey and Government Information]

Analysis and statistics to be developed

The main trends with regard to poverty in Gauteng are:

  • Increasing income inequality, with the rich getting richer and the poor getting poorer since 1995 to 2001 according to the Gini co-efficient, with inequality being most pronounced in the African population;
  • The Human Development Index shows a decline in human development, from 1995 to 2003, in terms of income, life expectancy and education also largely influenced by the spread of HIV/Aids,
  • Human Poverty has also increased;
  • Life expectancy has declined largely through the impact of HIV AIDS. In Gauteng 16% of the population is infected with HIV/AIDS, which means 1.4 million people are living with HIV/AIDS. Of these close to 97 000 have AIDS
  • In terms of the poverty rate about two million people earn or exist below the poverty line;
  • According to Labour Force Survey statistics, of Statistics South Africa, between1999 and 2002 there was an average annual decrease of 2% in employment. This has also been happening in the context of greater fragmentation in the labour market with new jobs being created at low wages;

3. The ANCs Approach to Poverty Eradication

In the 1990s the ANC, expressed a strong commitment to redistribution based on the Freedom Charter and embodied in the RDP. However, since 1996, with the adoption of GEAR, South Africa opened up its economy in a more accelerated way and began adjusting to the imperatives of neo-liberal expansion in the world system. To this extent, the trajectory of the ANC government accumulation path has achieved the following objectives:

  • The maintenance and management of capitalism in South Africa;
  • Its stabilization, such that it can withstand speculative shocks, maintain essential macro-prices (interest rates, exchange rates etc.), manage public debt and keep inflation within manageable limits;
  • The creation of conditions for increased growth, profit maximisation and expansion through competition policy, liberalizing commercial financial markets, "privatization", Black Economic Empowerment, allowing the fragmentation of the labour market through atypical forms of employment, MEGA development projects (like COEGA, BLUE IQ etc. ) to attract capital and other measures;
  • Repositioning South African parastatals and private companies on the African continent to contribute to development and in the ultimate sense extract surplus from these countries. Put differently, there is a general economic asymmetry between South Africa and most other African countries and most trade and economic development relationships are to the advantage of South Africa;

However, the cost to the workers and the poor, both in South Africa and Africa, cannot be ignored.

However, the December 2002 Stellenbosch conference of the ANC and the ANCs election manifesto has begun to signal a shift towards a redistributive agenda within the framework of capitalism – to mitigate the effects of failed trickle down. At the same time, certain concessions are made to the SACP in terms of co-operatives, sustainable livelihoods and sustainable local economic development, for example. The ANCs manifesto also was the basis on which the electorate was engaged for the 2004 elections and which yielded an overwhelming ANC victory.

However, the overall role of the manifesto in the post elections context has to be clarified. How are we to work with it? In this regard the following issues are important:

  • The ANCs manifesto was a general statement of undertakings and commitments to the country. It did not speak to specific polices in provincial and local governments;
  • The manifesto also reflects some of the Stellenbosch conference outcomes and cannot substitute for the primary resolutions adopted at the conference;
  • The manifesto is open to interpretation and can develop a "government version" and "Alliance version" and an "ANC version". How do we ensure a common minimum understanding prevails in the ANC-led Alliance political structures?;
  • The Peoples Contract as a means to "fight poverty and create jobs" is very important for breaking the reformist mould of governance (a point picked up below);
  • Elements of the SACPs program are contained in the manifesto but at the same time the parties program is wider than this.

4. The Gauteng Government’s Approach to Poverty

4.1 Trade and Industrial Strategy 1997 and 2003 and the Provincial IDP

The Gauteng government, in terms of its economic policy agenda, over the past few years could not escape the GEAR macro-economic framework. In the main, its 1997 Trade and Industrial Strategy re-inforced the growth based thrust of GEAR and market led development. The main strategic thrusts of the 1997 Trade and Industrial Strategy of the Gauteng Government focused on :

(1) Realigning the manufacturing sector from heavy industry and low value added production towards more sophisticated, high value added production;

(2) The development of a smart province with a focus on information and communication technology, telecommunications equipment, research and development and the bio-technology industry;

(3) The development of the finance and business service sector with a focus on financial services and technology, auxiliary services and technology, corporate head office locations, transport and business tourism;

Underpinning these strategy has been a host of investment projects known as BLUE /IQ.

TheBLUE/IQ investments have been on both the demand and supply side of the economy, and have been meant to shift the provincial economy on to a new growth path and structurally ensure that Gauteng becomes a high skill, high growth, high export and high wage economy. The projects envisaged are the following:

  • The creation of an Innovation Hub;
  • In Transport – a rapid speed train, the upgrade of Johannesburg International Airport and the establishment of an IDZ, the upgrade of the City Deep Container Depot and IDZ;
  • In High Value-added Manufacturing – the expansion of the Gauteng Automotive Cluster, the regeneration of the Wadeville-Alrode Corridor;
  • In Tourism – the marketing of the Cradle of Humankind, the marketing of the Dinokeng Big Five Reserve/NEGI, the upgrade of the Newtown Cultural Precinct and the creation of Constitution Hill.

In 2003 the government has adopted a revised Trade and Industry Strategy with an additional focus on employment creation, poverty alleviation and greater business activity.

The provincial IDP has played an important role, in the main, around co-ordinating local government investment into BLUE/IQ projects. It seems the provincial IDP does not go beyond this to coordinate and plan provincial and local government CAPEX investment in general. Most importantly, it does not strengthen decentralization and community led development planning.

4.2 An Emerging Poverty Alleviation Agenda

The following elements constitute an emerging poverty alleviation agenda in the Gauteng Government:

  • Social grants – In 1999/ 2002 there were major increases in the provision of old age pensions, disability grants, foster care and child support grants, with 294% increase over the period;
  • Short term job creation – has happened through Community Based Public Works which has lead to the building of schools, clinics and other government infrastructure, Labour Content of CAPEX Expenditure, Labour Intensive Contruction, The Zivuseni Program to maintain provincial assets, working for water and Land Care;
  • Food gardens and school feeding schemes;
  • Free basic water and electricity;

3.4 Problems With The Gauteng Governments Approach to Economic Development and Poverty Eradication

These are the following problems with the Gauteng Governments approach to economic development and the poverty challenge:

  • The Gauteng Government claims a multi-pronged approach to poverty alleviation, which envisages a situation where the short-term poverty alleviation thrusts link with the long-term growth envisaged with BLUE/IQ. In other words, the assumption is as investment flows into BLUE/IQ projects and the Gauteng economy in general, growth will happen and jobs will be created - benefits would trickle down to poor households. In fact while some investment has flowed into the economy it has not necessarily been labour absorbing and at the same the 3.3% average growth rate has not been job creating. Instead, growth in the Gauteng economy has been job shedding since 1999, with an unemployment rate of 35.1%. In short, the hi-tec, high skill growth path of the 1997 Trade and Industrial Strategy and its BLUE/IQ projects have contributed to increasing poverty in the province, as evidenced by the measurements of poverty above, over the past few years. (its not as though we did not say this in 2001 Congress , but lets not say it to loud, lest we offend the powers that be);
  • By focusing on the developed side of the capitalist economy in Gauteng since 1997, the "township" side of the economic reality has not been tackled. Only, a few regeneration nodes have been encouraged like Alexandria, Kliptown and Kathorus. What about other township communities? In fact, this kind of selective approach to urban regeneration perpetuates inequality between townships and in the main within the African population;
  • The emerging anti-poverty agenda is also welfarist and alleviation centered. The main objective is merely to ameliorate absolute poverty or extreme poverty. There is a strong emphasis on the "social wage" like free quantities of water and electricity or health care. This approach to poverty does not go to the roots of poverty and therefore will not tackle in a context specific way the multi-dimensional aspects of poverty caused by colonialism of a special type;
  • Deriving from a welfarist and poverty alleviation approach is a bureaucratic and statist tendency in government. In other words, the state is willing to give the most basic levels of protection against poverty and people in general must merely be passive recipients of this support. This approach has also marginalized the Alliance in the development process on the ground. We have not been able to build a Broad Movement for Transformation that works with the state to build peoples power and self-reliance amongst the people. In short, the welfarism of the Gauteng government has been reformist – decentralisation and a people driven reconstruction and development process has been rejected;
  • Integration, coordination and participatory planning between provincial and local government around CAPEX expenditure in general has not really been done tightly, because of the BLUE/IQ centered approach to development. In fact, a "quasi federalism" exists between provincial and local government with regard to development planning;
  • Where resources have been given to groups and communities for poverty alleviation projects this has not really worked. According to the Social Development Department in the province about 260 poverty alleviation projects failed over the past two years. This has then led to a shift in terms of short term job creation programs like Zivuseni and Labour Intensive Construction etc. However, the problem with this shift is that it has failed to understand the failures of how government approached and managed the creation of poverty alleviation projects. It is clear that an integrated training, enabling and capacity building support environment and network was not in place to incubate and nurture these projects.. Money was merely poured into communities and development was meant to happen. A lot of the institutional support in the province for SMEs, like GAUMAC or GEDA have not made themselves relevant to the township development process or to co-operatives for that matter. In fact, co-operatives and the co-operative movement are not very prominent on the policy agenda, instead these is a lot of rhetoric. Also "footloose" community development workers, welfarist multi-purpose centers and technocratic top down IDPs/ward committees have not assisted this process of consolidating the development of community based livelihood projects;
  • The shift to short term job creation does not solve the problem. While basic income transfers happen through public works it is not sustainable. At the same time, employment in these projects happens in a haphazard way such that "work opportunities or rights" are not distributed evenly. Again further perpetuating inequality or the insider/outsider trend amongst the poor in the development process. More importantly, there is no real pathway out of the public works program into the formal economy, particularly if the latter is not labour absorbing;
  • Environmental degradation and pollution is also not being tackled in a serious way. The mainstream white monopoly controlled industrial and service based economy in Gauteng has supported the wasteful and polluting lifestyles of the middle class and the bourgeoisie. Strengthening this pattern of economic development further increases environmental degradation and pollution in the province for which the poor and working class have to pay the price;
  • The procurement system in the province has increased SMME promotion with 53% of tenders being given to SMEs in 2000 and 60% in 2001. In the main the procurement approach has promoted a parasitic lower and middle class and has not encouraged broad based and collective black empowerment through co-operatives;

3. Towards A Socialist Poverty Eradication Strategy For Gauteng

3.1 Scenarios for Gauteng 2014

Over the next ten years if the Gauteng Government continues on the same path and the policy agenda for economic development and poverty eradication is not changed in any fundamental way, we are likely to witness and experience two possible scenarios:

  • Insider/Outsider scenario – this means capitalism in Gauteng will be deracialised but with deep economic, class and gender divisions. A hugh black middle class will develop but not to the point where everybody has the opportunity of being middle class – a significant part of the population particularly the permanently unemployed and most migrant workers from other places would not be included within the middle class. Also, the vagaries and instability of market led growth and development would also easily proletarianise those at the lower end of the middle class and "push people of the middle class plateau" back into poverty. Spatially and geographically, there would also be sharp polarization within the urban edge and between communities within the urban edge and those outside – the latter sometimes being referred to as the urban and rural divide in Gauteng. In the end, this polarization will be defined by concentrations of extreme wealth versus concentrations of extreme poverty. At the same time areas like the Newtown Precinct or the regenerated inner city will get very gentrified, land and housing, would increase in value also excluding many poor and working class people. In the end crime would increase as poverty increases for those that are excluded from the benefits of development and a stronger law and order state would emerge;
  • Stabilised poverty – the other scenario would be a level of absorption of labour into the mainstream Gauteng economy and greater attempts at state led "trickle down". In other words, forms of absolute poverty in which essential services for sustaining human life are met and poverty is stabilized. Put more sharply, poverty alleviation achieves the social engineering shift from extreme poverty to relative poverty. This means the reproduction of the poor and the working class is managed at a basic level while greater profits and wealth goes to the middle class and monopoly capital. Again, this would be a class, race and gender divided society but within constraints to ensure the legitimacy of the government. There would also be greater polarization between the formally employed working class and the excluded, permanently unemployed poor;

Both these scenarios for Gauteng Province over the next ten years compromise the historical program of the ANC led Alliance.

However, as the South African Communist Party in Gauteng Province we have an alternative vision for Gauteng over the next ten years.

3.2 Our Vision and Approach - Poverty Eradication and Employment Creation To Build Elements of Socialism

We believe a future Gauteng province and economy should embark on an alternative development path in which means and ends ensure:

  • The building of elements of socialism that decommodify, socialize and ensure greater democractic control of resources, asssets and culture by the poor and working class rather than the market;
  • Poverty eradication is a developmental challenge and not an alleviation challenge and ensures trickle down stabilization to the poor is challenged. Instead the underdevelopment of the township reality within one mode of production has to be tackled directly through a wholistic and integrated approach to end the gross and acute income/non-income inequality, ensures full human development - of blacks and whites, women, men and children - and growth that benefits all and the environment. In short, the fundamental contradiction that is necessary for capitalism to survive in South Africa has to be overcome head on such that a momentum is created for revolutionary reform;
  • The development of an expanded and strategic state sector at provincial and local government level, with varied forms of state control and ownership arrangements;
  • The Promotion of socialist and self reliant sustainable development in the township such that intra-community inequality and inter-community poverty is evenly tackled;
  • Collective empowerment through values of co-operation, partnership, sharing and self provisioning takes root and becomes an integral part of the fabric of Gauteng society;
  • Information technology and communications technology, science and engineering and research is harnessed for the development of appropriate, ecologically clean and safe technologies for communities and speedy delivery of state services;
  • Human and socio economic rights have to be at the foundation of the development process, such that there is human rights education and culture;

3.3 The Elements of a Socialist Poverty Eradication Strategy For Gauteng

  • Working Class Led Decentralisation and Popular Mobilisation – that ensures the deepening of democracy beyond multi-party competition, to embrace participatory, people driven development working in partnership with government. In other words, a government led approach to decentralization using the ward committee system to ensure decisionmaking and resources management for sustainable LED projects, infrastructure development, housing and food security in and with working class and poor communities. Also mobilizing the organized working class in the province to ensure that the frontiers of worker control are expanded in the labour process;
  • Building Sustainable Livelihoods, Cities, Communities and Households – targeting the permanently unemployed and ensuring a minimum of social services for survival – shelter, water, electricity, food security, health and education plus the use of ecological resource management and sustainability to ensure self-reliant socialist local economic development.
  • Building the resource base and capacity of the poor- in terms of physical, financial, natural and human resources in households and township communities;
  • Developmental Governance and Labour Intensive Growth - The building of a developmental approach to governance that coordinates through democratic planning, leads capital and the co-operative movement, builds state enterprises and a sector in partnership with social forces, and ensures the benefits of growth and development are evenly spread. Linked to this is the selection of key sectors of the provincial economy for development for livelihoods and employment creation.

3.4 Key Thrusts To Advance the Elements of the Socialist Poverty Eradication Strategy

3.4.1 Working Class Led Decentralisation and Popular Mobilisation

  • Ensuring the Peoples Housing process decentralized financial and technical resources to poor households based on the Co-operative Local Economic Development Agency model of housing support centers – the CLEDA will provide a window of technical support for socialist self reliant LED;
  • Build and promote local co-operative movements with state assistance in the following regard: R5 billion rand for start up financing (from provincial and local government) for co-operatives also working with credit unions, an active link with public works and IDPs, support from government in the province to ensure tertiary institutions train co-operative managers, ensure procurement quotas, in government, privileges the co-operative movement; building a network of training, support and research organizations and ensuring government financial support for such support organizations and finally ensure all local governments to establish co-operative movement forums, resourced by local government;
  • IDPs and ward committees – integration with sustainable led (LA 21), poverty eradication, and national interventions. Also to ensure ward committees develop ward based IDPs;
  • Ensure trade unions led by COSATU in the province engage employers on the following: reduction of working time with no loss of pay, productivity arrangements and job sharing arrangements, pursue worker buy outs and conversion of enterprises into co-operatives through support from unions investment companies and promote self management arrangements through workplace place forums;

3.4.2 Building Sustainable Livelihoods, Cities, Communities and Households

  • Ensure that the struggle against HIV/AIDS focuses on ending stigmatization, builds the primary health care system such that it services the poor efficiently and that poverty eradication interventions link with this;
  • Access to the education system is strengthened through active indigents policy, buses to be provided to all schools to ensure safe transportation of children living a certain radius away from the schools;
  • The acceleration of water and sanitation provision to all households;
  • Government to ensure food security is enhanced in communities through household organic food production and local urban commercial organic agriculture, Community Food Security forums to be established in every township community as per the guidelines;
  • Alternative energy sources – wind, solar, bio-mass and biodiesel, bio-gass digestors etc are experimented with, to ensure local job creation and the cutting back of running costs of households;
  • Ensure the emergence of Co-operative Labour Banks in communities to ensure the supply side of the labour market is organized on to databases and work rights are evenly distributed for community public works, IDP projects and other poverty eradication projects.

3.4.3 Building the resource base and capacity of the poor

  • Ensuring the CLEDAs and Community Development Workers intervention of government is merged in local communities;
  • We call on government to establish an Institute for Appropriate Technology, Innovation and Sustainable Local Manufacturing to build a research and innovation capacity for eco-friendly and appropriate technologies for communities;
  • To ensure micro-finance institutions like credit unions are established for local communities with government support and through the financial sector campaign;
  • Ensure procurement policy targets not just rich black companies but also supports emerging collectives and enterprises amongst the poor;
  • Ensure social grants are clearly targeted to poor households;
  • Call on government together with the emerging broad movement for transformation to establish a commission to investigate the decentralization of financial resources to poor communities through IDPs and ward committees( about 30% of provincial fiscal resources) within an empowerment, legal and capacity building support framework to ensure people led development;

3.4.4 Developmental Governance and Labour Intensive Growth

  • Ensure a Peoples contract is put in place at a local government level involving local ward committees and community organizations;
  • Ensure capital expenditure in local governments (two tier) is coordinated with provincial government through a participatory planning commission set up through legislation in the province;
  • Call for an active approach to in the Alliance and in government to expose and deal with corruption;
  • Government to establish capacity in the province to provide credible statistics at both provincial and local level to understand development trends and impacts;
  • All local governments to establish public policy forums, around different sectors of the local economy to ensure participatory policy making and implementation;
  • Build a network of training institutions and education SETAs in the province that work closely with provincial and local government and the co-operative movement;
  • Government to promote the development of a co-operative sector in the provincial economy by encouraging research and co-operative development;
  • Government to limit the levels of managements in the bureaucracy and to ensure speedy delivery time;
  • All led departments to be resourced effectively in local government to drive and promote sustainable and self reliant local economic development;
  • The provincial and local government to ensure new livelihoods and jobs are created through targeting greater land ownership by the state at local and provincial level so that communities can lease or use this land for production purposes, build a massive waste collection and recycling capacity in every community, using co-operatives, such that value adding also happens, promote and invest in the local alternative energy sector and finally ensure the development of intermediate and light manufacturing in township communities through sustainable local manufacturing hives;
  • Promote the emergence of state enterprises in municipalities in partnership with local communities;
  • Ensure an active training program is in place by government to train black engineers, computer experts and scientists;
  • Investigate the possibility of having full time councilors at a ward level and who are payed proper salaries as part of an attempt to prevent corruption;