Battle for hearts and minds of the poor

The ANC declares that it is winning the war against poverty, thus fulfilling the promise it made in 1994 to ‘provide a better life for all’. It is on this issue that it will seek re-election next year. Is this election rhetoric or does it reflect reality? In his state of the nation address president Mbeki cited ten consecutive years of economic growth and 5,4 per cent growth in the manufacturing sector in 2002 as proof that the tide has turned. He also listed a number of ANC initiatives that he believed were having a positive impact, including tax reforms, hikes in social grants, increased supplies of essential services to poor households, and accelerated land redistribution. He announced future plans to expand social services, extend unemployment insurance to domestic and agricultural workers, and increase the number of households receiving free quotas of water and electricity. DA leader Tony Leon responded that for many people, life is not improving but getting worse. Black incomes are 18 per cent lower than in 1995, nearly 20 per cent of households don’t have enough to eat, 4,7 million South Africans are HIV-positive, and crime in every category except murder has increased. He added subsequently that overhasty transformation of the public service has led to administrative incompetence which is hindering service delivery to the poor. Professor Sampie Terreblanche agrees that the poor have become poorer and that the weakening of the civil service has contributed to ‘their further disempowerment’. (However, Terreblanche blames capitalism for many post-apartheid ills, whereas Leon sees it as the solution.) Tony Twine of Econometrix points out that jobless growth is not unique to South Africa but occurs in many modern economies, and that the benefits of GDP growth are not distributed equally. Thus incomes have risen for those in the formal economy but not necessarily for those in the informal sector. Lawrence Schlemmer concurs, pointing out that while the proportion of black households living below the breadline increased from about half to nearly two-thirds between 1993 and 2001, the proportion of black middle-class households also increased. Similarly, Statistics SA’s 2003 labour force survey shows that there are more employment opportunities but also more people without jobs. Within the formal sector the reward accruing to non-labour factors of production is increasing while that of labour is decreasing. The poor may be feeling increasingly sceptical about the ANC’s ability to deliver, and this could present an opportunity for the DA.

The ruling African National Congress (ANC) has boldly declared its conviction that it is winning the war against poverty, thereby fulfilling its promise "to provide a better life for all" as proclaimed in its 1994 election manifesto and reaffirmed during its 1999 general election campaign. In declaring its belief, the ANC has defined the issue on which it will seek re-election next year, a decade after it first won the right to govern South Africa.

Battle has already been joined on whether the ANC's proud declaration is one that reflects substantive reality or mere rhetorical extravagance. The Democratic Alliance (DA), the largest of the dozen or so opposition parties represented in parliament, has picked up the gauntlet thrown down by president Thabo Mbeki, when he challenged those who believe there is as much - or greater - poverty in South Africa today, than there was in 1994, to substantiate their "false conclusions".

Mbeki issued his challenge during his response to the debate on his state of the nation address to parliament in February. But the scene was set earlier, at the ANC's 51st national conference in Stellenbosch last December and, subsequently, in the ANC's national executive statement of January 8.

The 51st national conference defined its "strategic goal" for the decade ahead as the "eradication of the legacy of colonialism and apartheid", the sine qua non of which was the "realisation of the objective of the eradication of poverty". The ANC hoped it would celebrate its 100th anniversary on January 8, 2012, by winning its final victory over poverty on or before that day. In the interim the ANC national executive statement of January 8, 2003, committed itself to focusing "particular attention on the struggle against poverty" in the year ahead. Mbeki returned to the theme in his state of the nation address, in which he twice declared the "tide has turned" in his government's fight against poverty and its quest to change the "lives of South Africans for the better".

Mbeki sought to buttress his assertion with statistical data. He noted in particular that South Africa's gross domestic product growth had held steady for 2002 at 3,1 per cent, having exceeded the 3,0 per cent mark in 2000 for the first time since the ANC came to power in 1994. "We have now had ten consecutive years of positive growth," he added with pride. He cited further statistical pointers to economic progress chalked up during 2002. They included 8 per cent growth in gross fixed capital, 5,4 per cent growth in manufacturing ("the fastest since 1995") and the biggest gains by the rand against the dollar in 15 years.

Reinforcing his point, Mbeki went on to emphasise a series of ANC-initiated measures that he believed were impacting positively in the campaign against the legacy of poverty inherited from successive apartheid governments. His list of ANC initiatives incorporated tax reforms (that cumulatively expanded the income of employed citizens by over R38 billion), increases in social grants (that made a further R1,5 billion available to the "most vulnerable" citizens) and a multiplication in the value of the "social wages" paid by government to the general citizenry (that increased water and electricity connections to poor households, accelerated the programme of land restitution and redistribution and wrought improvements in teaching and learning in schools).

Mbeki concluded with a summary of planned measures to reduce poverty in the coming financial year, made possible by the accumulation of funds from the government's policy of strict fiscal discipline. He spoke of plans to expand social services (in the form of increased old age and disability pensions and child support grants), extend the unemployment insurance scheme to house servants and agricultural workers, and increase the number of households receiving free quotas of free water and electricity. He added two brief paragraphs - almost as an afterthought his political opponents charged - on the health service. He devoted less than 40 words to the HIV/Aids plague and seemed to downgrade its threat to the promised "better life for all" by rating tuberculosis as South Africa's "leading killer disease" (and apparently not taking account of the near certainty that the deaths of many tuberculosis patients are Aids-related deaths).

In his response in parliament the DA leader, Tony Leon, directly rebutted Mbeki's scenario: "For millions of fellow citizens, life is no better now than it was in 1994. For many people, in spite of political freedom, life is actually worse".

To substantiate his assertion, Leon focused on three issues: the HIV/Aids crisis, the high crime rate and the large - and growing - problem of unemployment. Characterising the government's response to HIV/Aids as one of "long denial", he said, "Hundreds of thousands of South Africans are dying of Aids every year".

On crime, he said: "We are still at war - with ourselves. In just ten years, murder in South Africa has claimed close to 200 000 victims. These victims are not soldiers. They are civilians - at home, on their way to work, coming back from school". On the failure of the economy to reduce unemployment, he said, "One in every three South Africans is unemployed. Seven million are out of work. Black unemployment has risen from 46 per cent in 1995 to 55 per cent in 2001… Our nation's policies are pro-market but anti-growth, pro-labour but anti-poor".

Since then the debate has largely simmered on the back burner as it yielded to more urgent news coverage of the spectacular events leading to the US-British invasion of Iraq and the war in that benighted country, as well as the shifting political loyalties of elected representatives in South Africa's national and provincial legislatures during the "window of opportunity" for them to cross the floor without forfeiting their seats. But the question of whether the ANC was winning or losing the war against poverty has never been far from public consciousness in South Africa, due in part to persistent questioning by Leon of the ANC's portrayal of itself as the true and indefatigable champion of the poor.

To the chagrin of the ANC Leon continues to insist, "South Africa is in crisis". The horsemen of the threatened apocalypse that he sees on the horizon are poverty, unemployment, HIV/Aids and crime. With the aid of a competent team of researchers he regularly presents a series of facts in speeches, replete with footnotes identifying the sources of his information.

A sample of Leon's disturbing glimpses into the future in which an apocalyptical spectre looms large includes:

In an interview with Focus Leon draws attention to another factor that he thinks is hindering the government in its quest for a better life for all South Africans. By pressing ahead too quickly (or too recklessly) in pursuit of its aims of "completely transforming" the public service, the ANC is "disestablishing" the machinery of state on which it relies for the delivery of social services and the implementation of its policies. While demographic representivity and affirmative action may be laudable in themselves, they should not be implemented at the expense of merit, experience and appropriate qualifications and skills, Leon reckons. He argues that the administrative incompetence that afflicts the public service ranges from under spending and over spending to negligence and even dereliction of duty, hence post-apartheid South Africa's record of poor delivery.

In pressing his contention that the ANC has failed - and is failing - to improve the quality of life of many of South Africa's poor people, Leon finds himself in the company of those whose political outlook is decidedly further to the left than his own. While Leon and these South Africans on his political left, foremost among them Sampie Terreblanche of the University of Stellenbosch, might disagree on many issues pertinent to South Africa's political economy, their views converge on the question of whether life has improved for the poor, particularly those in the black community.

Terreblanche writes in his A History of Inequality in South Africa of the continued "pauperisation" of half of the South African population since 1994. Under a graph showing that the poorest half of the South African population (23 million out of 45 million) possessed a mere 3,2 per cent of the income in 2001, he states of the post 1994 period: "From a socio-economic point of view, the poor became more marginalised, powerless and pauperised".

In an assessment that converges largely with Leon's on the malfunctioning public service, Terreblanche adds: "The weakening in the public sector, especially that of departments directly responsible for the poor, has made a disturbing contribution to the neglect of the poor and towards their further disempowerment and pauperisation". Describing post-apartheid South Africa as a "highly stratified class society" Terreblanche says in a footnote on the new pattern of inequality: "The rich have become much richer and the poor considerably poorer over the past eight years".

Leon and Terreblanche are unlikely to concur in their analyses of the causes of the "further pauperisation" of the poor under the ANC-led government and in their prescriptions for its rectification. Leon inclines strongly to liberal-capitalism and a market economy (though his party has championed the idea of a basic income grant). Terreblanche blames much of post-apartheid South Africa's ills on the success of the Anglo American Corporation (AAC) and its corporate brethren in persuading the ANC to abandon its socialist-orientated ideology and its Reconstruction and Development Programme for liberal-capitalism and "neo-liberal" macro-economic policies.
But, in the context of Leon's present dispute with the ANC, Terreblanche has provided Leon with powerful arguments that buttress his case that, on balance, a large proportion of South Africa's poor are worse off socio-economically today than they were in 1994. Terreblanche's arguments have the potential to resonate profoundly among voters in the political manoeuvring that precedes next year's scheduled election. So, too, does the Human Rights Commission report on socio-economic rights for the period 2000-2002. The report, released in April 2003, records the failure of the government to fulfil its social welfare and "social income" delivery targets across a wide front, from the "real decline" on per capita spending on health to the continued existence in South Africa of "marginalized groups" for whom constant hunger is a concrete reality rather than an abstract threat. DA spokesperson for finance Raenette Taljaard labels the report "invaluable" for highlighting the chasm between promise and fulfilment.

The ANC-led government, however, has not abandoned the field to its political foes. It still insists that it is making progress in the fight against poverty. It adduces in response to the Human Rights Commission report official figures pointing to an expansion in the proportion of households gaining access to clean water and electricity supplies (up between 1995 and 2000 from 3 million to 8,4 million in the case of water and from 2,3 million to 3,8 million in that of electricity). It cites similar figures for the proportion of households with access to formal housing and chemical or flush lavatories. The increases between 1995 and 2000 are from 65,8 per cent to 72,6 per cent for formal housing (the increase being due in large measure to an increase in the availability of subsidised housing since the ANC came to power) and from 56,9 per cent to 58,3 per cent for the sanitary disposal of household sewage.

Mbeki continues to hold imbizos or discussions with people at gatherings throughout South Africa. People from informal settlements and remote villages, as well as urban townships, are invited to air their feelings directly to him on the efficacy of government's fight against poverty. The ANC contends that the imbizos enable Mbeki to ensure that deficiencies that may exist in its campaign are addressed and that it is not simply a top-down crusade in which the politicians know best and the people are expected to be passive and grateful recipients.

The array of facts and figures, arguments and counter-arguments, theses and antitheses, has the capacity to obfuscate rather than clarify. One response is to endorse Mark Twain's aphorism that there are statistics, damned statistics and lies and to conclude that politicians use them interchangeably as the propaganda tools of their trade. Tony Twine, of Econometrix, has a less cynical interpretation of what it might mean, however.

He notes that jobless growth, though one of the identifying economic traits of post-apartheid South Africa, is not unique to South Africa, adding that it is a feature in "many" emerging economies and in "almost all" industrial economies of the world. In mixed economies, such as South Africa's, there is always going to be a section of economically active people who are not major beneficiaries of even accelerating GDP growth, Twine states.

Citing an average annual GDP growth of 2,7 per cent and a population growth rate of 1,8 per cent since the ANC came to power, he concludes that per capita income has certainly risen in real terms. He adds an important corollary however: it has risen for those in the formal and semi-formal economies but not necessarily for those in the informal sector. Extrapolation from that leads to the conclusion that life may have got appreciably better for some South Africans but become worse for their less fortunate compatriots.

Terreblanche comes to a similar conclusion in his tome on the history of inequality in South Africa. But he blames the machinations of the AAC, and the susceptibility of the ANC to its sweet talk about the virtues of market-driven capitalism, for the continued exclusion of half the South African population from the formal economy and for their "pauperisation" under a government that constantly portrays itself as the champions of the poor, the insulted and the injured.

Independent sociologist Lawrence Schlemmer who is the director of The Helen Suzman Foundation, concurs that some South Africans are benefiting from, and some ailing under, the ANC-led government since 1994. In an analysis of All Media and Products Surveys (AMPS), published in Focus 26, 2002, he concludes that between 1993 and late 2001 the proportion of black African households living below the breadline (i.e. earning R400 or less a month or equivalent amounts adjusted for inflation) rose from about half to close to two-thirds. That conclusion has, however, to be juxtaposed with another: the proportion of black African households in the relatively prosperous middle class category has increased simultaneously. The same patterns apply in the coloured population. Thus, as Schlemmer observes in his article, "African and coloured households have become both poorer and more prosperous at the same time".

As Twine points out, the same kind of ambiguity pervades much of the official statistical data. Thus the sixth labour force survey by Statistics SA, released to the media in March 2003, contains two apparently contradictory trends: the generation of employment opportunities in 2002 for the first time in five years in the formal sector of the economy amid a general increase in the number of unemployed. The Janus-headed nature of the unemployment problem is beyond dispute. The explanation for it is simple. As Anne Bernstein, of the Centre for Development and Enterprise, has noted, "Unless we're able to achieve 5 to 6 per cent growth per year, sustained over a long period, we're not going to be able to reduce the backlog of unemployment and poverty in South Africa".

Even within the formal sector there are incipient ambiguities. The economic data in the Reserve Bank Quarterly Bulletin for March 2003 points to interesting and probably significant development. It shows that reward accruing to the non-labour factors of production - particularly capital and entrepreneurship - is increasing while that of labour is decreasing. The figures show that the share of reward garnered by the non-labour factors of production increased from about 44 per cent to nearly 49 per cent between 1988 and 2002 while that channelled to labour fell from 56 per cent to nearly 50 per cent. Taken as a whole the pattern reflects a growing economy, in which the rewards accumulating to labour are declining. Further extrapolation leads to a tentative hypothesis. For at least some working class men and women life is becoming harder as its gets better for the select few who possess either capital or connections to the ANC that they can convert, through entrepreneurial skill, into an asset valued by the established white corporations anxious to attain a higher degree of demographic representivity.

In conclusion, it would seem that life is indeed getting better for sections of the historically disadvantaged black community but worse for their compatriots either on the fringe of the formal economy or outside it altogether. The degree of alienation is hard to quantify. There is no evidence of mass desertion by the poor from the ANC. There may, however, be diminishing enthusiasm for its causes and concomitant scepticism over its ability to deliver on its promises. There is thus a theoretical opportunity for Leon or a rival opposition leader to exploit in the pending election, though the history of Zimbabwe and, to a lesser extent, Namibia suggests that they may have to wait a while longer yet.