ANC NGC: Preliminary reflections on the Economic Transformation discussion document

The document’s ‘class innocence’ is an attempt, both in concept and in content, to move away from the ANC’s bias towards the working class and the poor, writes Solly Mapaila

The ANC’s mid-term policy review on economic transformation has to take into consideration the role of the ANC as an organisation, the leading component of the Alliance and the governing party.

In other words, the document on economic transformation must be articulated at least in response to these interrelated questions:

- What did the ANC resolve at its last National Conference held in Mangaung in 2012 on economic transformation?

What has the ANC-led alliance resolved in taking forward those resolutions and what else has it resolved itself?

How far have these mandates from the organisational motive forces of the national democratic revolution been streamlined and elaborated in government policy?

What progress has been made?

What challenges has the work encountered and what must be done to address them?

Instead, the economic transformation document is incoherent in so far as these questions are concerned. What it reflects are discrete presentations by different government departments on their work relating to the National Development Plan (NDP). This point should not be misunderstood to mean that the government is not crucial to the implementation of aspects of the NDP agreed to.

The point is made to highlight the necessity and importance of clearly visible content of the leadership role of the ANC in government. The mandating role of the ANC as the ruling party, leader of our Alliance and democratically elected government, must be clearly reflected in government policy. This cannot be substituted by arguments that sound technical or “class innocent” when they, in fact, not neutral at all. Projects that come from nowhere can actually be used to drive things other than what appears on paper. Rather, what the document must do is help us take forward declared ANC policy.

In particular, the basic content of radical social and economic transformation, a perspective adopted by the ANC in Mangaung, is entirely missing from the document! Which is perhaps where the document was supposed to begin.

The introduction, in particular, gives the impression that what we have before us for consideration is a government review of progress on the implementation of the NDP, rather than a comprehensive focus on radical economic transformation as a key factor in social transformation. Still, the way the interventions such as the New Growth Path (NGP) and the Industrial Policy Action Plan (Ipap) are discussed reflect serious weaknesses. These interventions predate the NDP, an economic doctrine that contradicts the basic philosophy, in varying degrees, of both the NGP and Ipap. The main thesis of the NGP (notwithstanding some contradictions) is that decent work, jobs and employment growth must be prioritised as the key drivers of economic growth. In the NDP this formula is inverted, and the NDP is virtually weak on and fatalistic towards Ipap, which is almost absent.

It would have been important for instance for the document to elucidate, in relation to the NDP, why and what weaknesses were being addressed by the ANC at its Mangaung Conference when it had to resolve that “critical instruments and policy initiatives” – including, in particular the “national infrastructure plan”, the “New Growth Path”, and the “Industrial Policy Action Plan” – “will continue to drive government’s medium-term policy agenda”.

The document asserts the Alliance partners “agree that the NDP is a living document not cast in stone and needs to be adjusted where appropriate”. It does not, however, reflect on what the Alliance has said in further discussing the NDP. For instance, the Alliance is aware that there are genuine concerns expressed by the SACP and Cosatu about the NDP and that this had to be addressed. But the document does not present any progress assessment on that work.

Related to this, it should also not be forgotten that the ANC in Mangaung resolved that there are areas in the NDP that must be strengthened – in other words changed because they are weak. There is no progress assessment on how far has this work been undertaken in line with the principle that the NDP is not cast in stone.

Basically, it is important to look at the Mangaung resolutions and conduct a detailed assessment of organisational performance on the issues being discussed. There are agreements such as, for example, reviewing and realigning macroeconomic policy to be in sync with our microeconomic policy imperatives of job creation and industrialisation. This includes, but is not limited to, agreements on ensuring a stable and competitive exchange rate. There is no progress evaluation on how far the work has gone and what the challenges are in implementing resolutions.

It is not enough to recognise the problem of currency volatility (“the volatility of the Rand”) as the document does. We need an examination of the factors causing this volatility and proposals on how to deal with them and achieve currency stability at a competitive exchange rate.

The document correctly identifies the structural weakness of the South African economy as lying in its colonial features. But then it goes on to call for easing conditions for commodity exporters, referring narrowly to mining resources rather than the vast array of manufactured products and services. In the section that deals with manufacturing, however, a correct perspective is presented in terms of Ipap, which is extended to the NGP particularly in terms of its jobs drivers – but only to a limited extent.

The sectoral analysis dealing with commodities and energy are extensive. But rather than move from the perspective of a mid-term review of the implementation of Mangaung resolutions, clearly spell out the challenges to implementation and how to overcome them, some parts of that analysis are asking for new policy mandates on certain issues and projects. This is in contrast to the spirit of the NGC, which is convened as a mid-term review, which the ANC clearly said is not a platform of new policy making. The fundamental issue that must be highlighted, however, is that the paradigm shift suggested is in directly contradicts the ANC’s perspective (shared by the Alliance) of moving our country’s democratic transition into a second, more radical phase of the national democratic revolution.

It is important to note that the decline in manufacturing employment and manufacturing sector activity, including the levels of investment, as presented in the document are currently occurring in the context of a tough international environment. If support for Ipap, a key instrument for industrialisation, is not strengthened, infrastructure development programmes alone might not become sufficient in the long run to industrialise our economy.

Also, it is clear that competition policy alone is not sufficient in dealing with the problems of economic dominance and monopoly. More interventions are needed in dealing with these problems – sloganeering in speeches without any serious measures in practice, both in the policy of the movement and in government is not the way forward. In fact, decisions taken since Mangaung, instead of weakening the economic dominance by a few companies, monopolies and oligopolies, have actually had the effect of strengthening them.

The digital migration process, for example, in fact strengthens the monopoly of Naspers through its subsidiary Multichoice in the pay TV market and its dominance in the TV sector more broadly. A further agreement signed between the SABC and Multichoice strengthens the latter’s monopoly and extends its influence on the SABC thus colonising it. In this way the SABC not only has lost its independence given the annexation of important rights and responsibilities from the SABC by Multichoice through that agreement but has also been short-changed in economic and therefore revenue terms.

Have there been no major takeovers or acquisitions of locally-based companies by global monopolies, including speculators for example? There is no comprehensive assessment of monopoly dominance in our economy. Nor is any serious attention given to the weaknesses of our existing Competition Commission and the Competition Tribunal, and related legislation and regulations to deal with the problems.

The document presents the NDP’s labour market policy as if there are no problems with that model, as if Cosatu has not raised reservations and expressed strong opposition to that model in the interests of workers. This is another area where the presentation of the NDP by the document as a “blue print of government, business and society as collaborative partners…” is exposed to be fudging differences and disagreements.

It is important to note that in class terms capital is clearly identified in that framing – ie in the quoted assertion from the document. But labour is not identified – instead we have “society” which in class terms includes labour. But does society not include capital (“business) is clearly identified in the formulation? This brings up the question: what is the class content of the document?

Clearly, the document reflects a paradigm that is down-grading the ANC’s Strategy and Tactics document’s principle that the ANC is biased towards the working class, including the poor. Perhaps this is a reflection of the character of the ideological approach and capacity of government officials? Where, for example, are the views of the working class on economic conditions and change in the document?

It is important to underline that the ideas being put forward in the document and those asserted in the NDP about the labour market are mainstream economics ideas of the bourgeoisie. They are not the ideas of the working class towards which the ANC is supposedly biased. That is why Cosatu, supported by the SACP, strongly opposes those ideas. The principle that the ANC is biased towards the working class cannot be a sentimental issue backed by nothing. The views of the working class on what must be done must be heard in econom ic policy documents. Action in asserting those views cannot also be found wanting.

Cde Solly Mapaila is the SACP’s 2nd Deputy General Secretary.

This article first appeared in the SACP journal, the African Communist, October 2015