Announce a R1-trillion stimulus plan, Cosatu tells Ramaphosa

Cosatu wants president Cyril Ramaphosa to announce a R1-trillion stimulus plan to form part of the government’s economic recovery plan.

The federation – which is also a member of the tripartite alliance led by the ANC – has also expressed disappointment in the R500bn package announced by Ramaphosa earlier this year to try and mitigate the socio-economic impact bought about by Covid-19.

“President Ramaphosa’s initial R500bn stimulus is inadequate and is not as strong as his language about the economic threat. His prescription did not live up to his diagnosis. We call on him to honour his commitments when he announces an economic recovery plan,” Cosatu said in a statement that followed a two-day sitting of its central executive committee.

Among the demands Cosatu tabled in addition to the ambitious stimulus plan are:

• a review of the lending criteria for the R200bn loan guarantee scheme;
• further repo rate cuts by the South African Reserve Bank;
• an extension of banks' payment holidays to customers;
• a mass public employment programme; and
• a “buy local” campaign.

Cosatu is also advocating for the adoption of the Eskom social compact and implementation plan by the presidential working committee, saying the economy cannot grow without reliable and affordable energy supply.

The country has again been plagued by nationwide load-shedding in two weeks as more sectors of the economy get back to work, putting pressure on the grid.

The alliance partner also wants the governing party to make good on its resolution from 2017 to establish a State Bank, which would have a bias towards the poor and working class.

“The federation challenges the ANC government to deal with the high concentration in the banking sector, as per the ANC resolutions. In South Africa, five banks account for more than 90% of deposits, which is one of the most concentrated banking systems in the world,” it said.

“The Covid-19 outbreak exposed the shortcomings of our financial and economic infrastructure. Small businesses were forced to depend on 'benevolent billionaires' for funding. We need a State Bank to help drive the government’s development agenda, including the funding of SMMEs.”

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