Solidarity tax needed to fight poverty - Phillip Dexter
Phillip Dexter |
01 March 2010
COPE's head of communications sets out a new vision for the party and the country
Towards the National Congress of COPE-20/20 Vision SA
While electing leadership and strengthening the party is the purpose of the COPE National Congress scheduled for May this year, developing a turnaround strategy from the ongoing malaise our country suffers because of the crisis of leadership of the ruling party and for unlocking of the potential of South Africa in the next decade must also be a priority of the Congress. This contribution is to stimulate debate on these issues.
The challenge
As we are celebrating the anniversary of the beginning of the process of democratisation of South Africa, we take stock of our many achievements. These achievements however, have not been because of good governance, a strong commitment to change by the private sector or significant mass-participation in the political life of our country. The truth be told, the advances made in terms of poverty alleviation, transformation and development have been in spite of what the government has done in recent times and without the active participation of the majority of our population. Needless to say, the commitment to change from the wealthy sectors of our population is patchy. This is unfortunate, as these are the citizens with resources and skills needed to unlock the potential for our country to develop.
For the most part, this lack of commitment is not because people do not want to be involved. The reality is that the majority of South Africans have difficulty in accessing the rights they have in the Constitution and in fulfilling their obligations as citizens. South Africa is a low intensity democracy, with only about 20% of the population able to enjoy their full citizenship. Most South Africans cannot fully participate in public discourse or governance structures because they are hindered by a lack of access to resources and communication channels, or they feel intimidated by those who currently hold power.
It is critical that COPE develops a forum to interact with all South Africans and investors in particular, to discuss how we can increase the investment levels in to our country. We also need to ensure that we become the leading organisation for mobilising the masses of our country to participate in the political life of our country.
-->
The opportunity
Twenty years on, there is a renewed debate on how to overcome the legacy of colonialism, apartheid and poor governance. We should be bold and seize this opportunity, allowing our imaginations to inspire us, as a young nation, to aim for the highest achievements, the best quality of life and the greatest opportunities for our people. We must have 20/20 vision for the future and we must turn around the current social, economic and political crisis we are engulfed in. We have very little time to do this.
This proposed strategy, 20/20 Vision SA, proposes a radical, unique and bold turnaround strategy for the country over the next decade. This will unlock the potential of our countries people, who are, after all, our most precious resource. 20/20 Vison South Africa is about partnerships: within communities, between government and the citizens, between the public and the private sectors and between civil society and government.
Democracy
-->
South Africa desperately needs reform of its electoral system. Currently, citizens have no say in who gets elected as their representatives at national and provincial level. The MPS, MPLs and even many councillors, are simply unaccountable. They are a drain on the fiscus who add little value to our democracy. We must have constituency elected MPs, MPLs and Councillors. This can be done through multi-member constituencies to avoid the pitfalls of a first past the post system, and to ensure fair minority party representation. COPE must make this a key issue for the next election campaign.
In addition, there should be open access media through which citizens can address their elected representatives. TV, radio and internet can all be utilised for this and at least one day a week, elected representatives should attend to the needs of their constituencies by being available to respond to the issues brought forward through these channels and in their constituencies.
Each government department must have a desk that deals with civil society participation and community outreach in terms of the governance programmes and policies of that department. The head of the community and civil society outreach desk must report directly to the Director General. The community outreach desks should provide the opportunity to give input for new major campaigns, new appointments to the executive management and changes in the policies of the department.
Media, ICT and Banking
-->
Currently, many people have very little access to media, ICT and banking. To shift all in our country into the 21st century, we must create open access TV and radio, a newspaper owned by a trust and managed by eminent South Africans, a public broadcaster that is truly independent, internet access for all and banking for all. To this end the SABC board should be appointed by an independent panel of South Africans made up of a judge, a media representative elected by the media workers and management through secret ballot, an MP from each of the major political parties (those with more than 5% of the vote and one for all the other parties combined), a business, labour and civil society representative proposed through Nedlac and the Minister of communications or his/her representative. This structure will also appoint the independent print media trust. These boards should serve for 5 years.
A government sponsored internet access company will be created that will set up internet access sites in every village, town, and neighbourhood. This will be free for the use of citizens who will be limited to access at these sites but who can access internet free through a wireless network that will be set up in every village, town and city. This internet network will be limited in terms of time per session and the amount of megabytes that can be downloaded.
Citizens that currently do not qualify for a bank account, or that do not know how to set one up, will be given a people's bank account for free at the Postbank. An educational campaign with special information sheets distributed through local supermarkets and post offices will educate people on the use of the people's bank account, its bank charges and the practicalities on how to set one up. A broadened access to banking will expand the reach of social services into communities and individuals that need the most support. This special bank account will be linked and limited to an ID number, it will have a very easy pricing structure, and will only charge customers for transactions larger than 500 rand with a variable pricing structure. The costs will be kept down by avoiding paper communication and making use of cellphone messaging and advertisement opportunities.
Poverty
-->
To alleviate poverty, every citizen and company will be given a Citizens Allowance of R100 per month deposited into their people's bank account. This will be reclaimed from those who earn more than R 3000 per month through tax.
Every unemployed person will be able to register for work at a Job Opportunity Programme office and through a publically financed SMS and internet job opportunity forum. On registration, citizen's will be approached with opportunities to do socially beneficial work , whether in neighbourhood maintenance, crime prevention, neighbour care, infrastructure maintenance or food security. This work will be in exchange for experience and food, and where possible in terms of resources and infrastructure, at a rate of R10 per day in the rural areas and R15 per day in the urban areas. Participation in these community job will give participants preference to training and skills development opportunities. In order to qualify for preferential access, volunteers must work for 3 months on each Job Opportunity.
A solidarity tax of at least 1% must be levied on all citizens and companies to fund poverty alleviation and fundraising initiatives will allow citizens and companies the opportunity to directly sponsor the Job opportunity Programme. This tax should last until unemployment in the narrow definition is at 10% and the average family household income is above R5000 per month (this target to be adjusted for inflation annually).
Unemployment
Through the Job Opportunity Programme and through a number of initiatives, including a one year tax break for each new job created, a skills and training opportunity for every worker for one year every five years, unemployment will be significantly reduced and the target should be by 18% in the narrow definition by the year 20/20. Other measures in enterprise development, agriculture and mining will also contribute significantly towards this objective.
Enterprise Development
A number of measures, including reducing company tax, giving tax breaks for start up businesses, no tax for the first 3 years if the turnover of the company is under R1,5m per year and it employs at least 1 new employee for each R500 000 of turnover. Through the creation of Exporting Processing Zones (EPZs) at each major port where new investors will receive a number of benefits, including the first 5 years at 5% corporate tax. EPZ's should be developed strategically, and specialization should be negotiated between regional hubs. For example, Saldanah Bay could specialize in servicing the off-shore oil industry in West Africa and Cape Town could support the tourism and fruit exporting industry. Durban could support the handling and processing of aluminium and Coega could specialize in the automotive industry.
An enterprise development fund for entrepreneurs under the age of 35 years, will provide a maximum of R150 000 in the form of a loan, repayable over 5 years at 5% interest and any business that employs a minimum of two people, the entrepreneur and one other person, a business plan and a minimum own contribution of R500 will qualify. Capacity to submit and assess business plans and share (subsidized) market research will be provided and an independent panel of suitably business, labour and civil society representatives will be established. The panel will have the opportunity to provide feedback,link up applicants with similar business ideas and grant special exemption if entrepreneurs cannot raise the R500.
Agriculture
All government land that is currently not utilised but that can be farmed, will be placed in to a Citizens Agriculture Company with subsidiaries in each administrative district. Every South African will receive one share in the company and all previously disadvantaged citizens and any child born after 1994 will receive an additional share. This company will lease this land to suitably qualified farmers and agriculture companies through a closed envelope bid process and a minimum rental will be set to lease this land. There will also be a profit share agreement with the farmers and all the dividends from this company will be distributed annually to the shareholders.
The agricultural district can be designed to aid equal regional development. The same will apply to forestry and game reserves. Fishing rights should be granted in the first to local communities (those who reside or whose parents resided in the area); only when local communities can exist next to large fishing companies and when community and worker profit sharing takes place should commercial international fishing cooperations get the right to fish in South African waters.
Mining
A similar company shall be set up in the mining industry as in agriculture. Due to the special nature of the mining industry companies active in the sector should have higher targets in terms of preferential procurement, skills development corporate social investment and enterprise development in terms of the BBBEE score card. In enterprise development special focus should be placed on developing a downstream industry, adding value to the raw materials that are mined before exporting the goods.
Public Enterprises
All public enterprises will be owned in the same manner as the Citizens Agriculture Company and the Citizens Mining Company. Targets for private ownership should be set for those public enterprises that are not natural monopolies, such as broadcasting, airlines and telecommunications service providers. For all companies that have network externalities, i. e. that will be cheaper the more it produces, vigorous national regulators that ensure effectiveness and efficiency according to the best standards in the world.
Governance and administration
The appointment of all senior managers in the public service, local government and public enterprises will be through advertisements and interviews conducted by an independent panel of suitably qualified business, labour and civil society representatives and the appointee of the political head of the post. These will be subject to an annual performance review that will include consideration of the input of those who receive the services from the institution in question. Set criteria should be drawn up for all managerial posts in public service that indicate required skills, education and experience.
Services: education, health, social services, water, waste, roads and others
Further policy amendments in the governance of schools, hospitals, police stations and other public services should facilitate the involvement of citizens through the civil society and community outreach desks.
20/20 Vision SA in action
Through these innovative measures, 20/20 Vision SA can empower our citizens to become active, allow them entrance into the economy, access to the technology of the 21st century and stimulate the economy. Most importantly, 20/20 Vision SA will inspire action and interaction, building social cohesion and eliminating the negative effects of unemployment, crime, poor services and wasteful government.
Electing leaders and building COPE to advance the 20/20 vision
The National Congress in May has a number of tasks. Amending the constitution of the party, updating policies and a program of action and electing leadership are the key ones. To this end, this discussion document seeks to contribute to the debate for the Congress. The Constitution should take into account the changes the party wants in terms on constituencies and ensure it elects leadership accordingly. This may mean an electoral college in each province and an allocation of seats on the CNC on this basis.
Whatever the outcome, the party must allow voting directly for leadership by its members. This can be done electronically, through cellphones and computers. The current system of delegates taking a mandate and going to conference is outdated. We must promote participation and this means involving all our members in the life of the party.
Choosing leaders is a key part of this. The policies and program must also be developed by involving all our members in these debates.
COPE has an opportunity to once again capture the imagination of all South Africans. Let us be bold and think out of the box in contributing to the festival of ideas.
Phillip Dexter is COPE's head of communications
Click here to sign up to receive our free daily headline email newsletter