How to fix SA's human capital crisis

26 May 2019 - 00:07 By PAUL NOUMBA UM

When apartheid ended, the democratic government faced an enormous challenge to overcome the legacy of exclusion of most South Africans from access to basic services.
Since 1994 thousands of classrooms and clinics have been built, teachers and health personnel hired. Public spending on education and health has increased and today a significant portion of the national income goes to these two crucial sectors. In less than a generation, SA achieved almost universal access to basic education and health services. This is something to be proud of.
Yet the challenges remain. I read with sadness recently about 224 pupils at Upper Mvenyane Senior Primary School in the Eastern Cape whose school has leaking roofs, no toilets, no water, no library, no computers, no science lab - the list of problems is long. The situation has been known for years, yet nothing has been done.
This is happening in the most developed African country and in the 21st century! What can children learn in these circumstances and what future can they hope for? Will they learn enough and acquire skills they need for the 21st-century world of work, so that SA can prosper?
A population's health, skills, knowledge and experience, commonly referred to as human capital, is one of the key drivers of productivity, growth and development. But what chance does SA have when there are still schools like Mvenyane?
The World Bank recently ranked 157 countries according to a human capital index (HCI) - an indicator of how productive a child born today in a specific country is likely to be, given the country's health status and education attainment, compared with how productive that child could be with full health and complete, high-quality education. SA did not fare well: it was ranked 126th, in the bottom 20%.
As such, a girl (or boy) born in SA today will be 41% as productive when she grows up as she could be if she enjoyed complete education and full health. This is only slightly above the average HCI for Sub-Saharan Africa (40) and significantly below the HCI for countries at a similar income level.
The HCI rating for SA is low because the country does not perform well in any of its contributing elements. Four out of 100 children will die before the age of five; 32% of 15-year-olds will not survive to 60.
Furthermore, 27% of children below the age of five are stunted and so are at risk of cognitive and physical limitations that can last a lifetime.
In SA, a child who starts school at four can expect to complete 9.3 years of school by his or her 18th birthday. However, factoring in what children actually learn, the real figure is closer to 5.1, showing a learning gap of 4.2 years (this gap is for example only 1.9 years in Russia). In SA, which already has high inequality, this learning crisis is widening social gaps instead of narrowing them.
These indicators clearly signal that the country faces a human capital crisis, reflected in structurally low economic growth, a low-skilled workforce and a very high unemployment rate, mostly affecting its youth.
Few children complete matric and very few go to university. More than half of the young people entering the labour market have no qualifications. Unqualified labour is not the basis on which a prosperous economy for the 21st century can be built.
The reasons behind poor learning and health outcomes include the capacity of health and education sectors to deliver quality services, accountability for results, sector management and governance.
These are not easy to tackle, but Peru, Vietnam and Rwanda are just a few of the countries that have overcome such challenges.
In SA, education spend is high at 6.1% of GDP in 2017. Many countries spend less, but achieve a much higher HCI rating, signalling that SA needs to take a hard look at the efficiency and effectiveness of its spending.
There is a willingness to act. In December last year, President Cyril Ramaphosa announced additional investment of R60bn over the next several years in education.Improving human development outcomes in SA requires commitment and action not only from the government but from parents and communities, who must not only promote the value of education and safeguard schools and clinics but should also demand good-quality services.Teachers, health workers, civil servants and political appointees all bear responsibility and should be accountable.To safeguard the future of the South African child, the World Bank Group stands ready to partner with the government to adjust SA's human capital course by bringing global experience from working with countries such as Indonesia and Peru.•Noumba Um is World Bank country director

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