President Cyril Ramaphosa is turning to the state to get the country working again through an ambitious R100bn public employment programme that he is confident will create 800,000 jobs in the next six months to three years.
The biggest job creator of his Presidential Employment Stimulus is the department of basic education, which will hire 344,000 unemployed matriculants as teaching assistants at schools. Their R3,500 monthly stipends will cost the state R7bn.
Contained in the final version of Ramaphosa’s economic reconstruction and employment plan, released on Thursday by the presidency, is a breakdown of where the other work opportunities will come from.
The department of social development’s income relief, job retention and registration support programme will contribute 111,000 employment opportunities at a cost of R588m. The department of agriculture, land reform and rural development will spend R1bn on its subsistence producer relief programme, which will create 74,000 employment opportunities; the department of environment, forestry and fisheries is to create 50,000 work opportunities by investing in the environment programme, costing R1.9bn.
The presidency itself has a social employment fund with a budget of R210m, which can create 35,000 work opportunities, while the department of transport is coming to the party with R630m in provincial roads maintenance funds that will create 37,000 work opportunities.
A municipal infrastructure fund run by the department of cooperative governance promises 25,000 jobs through a R50m investment, while the department of sports, arts and culture’s support fund for sports, arts and culture – worth R665m – could contribute 34,000 work opportunities.
The president is also hoping to create further work opportunities through a R365bn project to connect a million low-income households to high-speed, affordable internet and expansion of public wifi hotspots to reach a million people.
Addressing MPs, Ramaphosa said government wanted to be the key driver of employment opportunities in the country.
“Large-scale job interventions driven by the state and social partners have proven effective in many countries that have faced devastation from wars and other crises,” he said.
The recovery plan places energy security, mass employment, industrialisation, localisation, digital migration and tourism at the centre of economic growth.
Ramaphosa said modelling done by the National Treasury predicted a 3% economic growth over the next 10 years if the plan is implemented in full. The SA economy shrunk by 16.4% in the second quarter, shedding 2.2 million jobs.
He said rapid economic growth could be realised by procuring more locally made goods and exporting goods and services to the rest of the continent.
“SA currently imports around R1.1-trillion of goods, excluding oil, each year. If we were to manufacture just 10% of these goods locally, it is estimated that we could add two percentage points to our annual GDP.
“The rest of Africa currently imports R2.9-trillion worth of manufactured goods from outside the continent each year. If SA were to supply just 2% of those goods, it would add 1.2 percentage points to our annual GDP.
“And if we succeed in reaching our target of R1.2-trillion in new investment by 2023, it could add about 2.5% to our annual GDP.”
But industry cannot produce optimally if there is no reliable power supply. Ramaphosa said government was fast-tracking applications for electricity generation for own use in a bid to end crippling load-shedding and secure energy supply over the next two years. This will bring an extra 11,800MW on to the grid, more than half of it generated from renewable resources and supplied by independent power producers.
To boost tourism heading towards the festive season, an expanded list of countries from where resumption of international travel will be permitted will be published.
“We urge South Africans to continue to explore their country in support of the tourism recovery as one of the hard-hit sectors by the Covid-19 pandemic.”
Ramaphosa said the government was working to:
- improve the participation of SMMEs in the manufacturing value chain;
- revitalise the rail network;
- improve efficiencies at ports;
- release the high-frequency spectrum by March 2021; and
- complete digital migration to reduce costs of data for companies and households.
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