Newsmaker Cut the public service, and start with the cabinet, says BLSA’s Bonang Mohale
But bureaucracy needs to be reskilled as well, says lobby group chief
● Big business has told President Cyril Ramaphosa that the government sector is bloated and unaffordable and needs to be slashed, starting with his cabinet, says Bonang Mohale, who heads Business Leadership South Africa.
BLSA, which represents the largest companies in South Africa, has had several meetings with Ramaphosa since he became president, and has made it clear that it believes the government sector is overstaffed, unprofessional, corrupt and too expensive, he says.
“Government has 2.3 million employees, and they are paid far too much. The size of government must be reduced, starting with the cabinet.”
Public sector employment has been increasing, and just became a whole lot more expensive after the government signed a three-year, multiterm public service wage increase last week that smashed its 2018 expenditure ceiling by R30-billion.
Business Day reported this week that the government will offer voluntary retrenchment to those over 60 in a bid to cut costs.
Business leaders told Ramaphosa that public administration also needs to be rebuilt, because it has been losing skills and competence. “We have been saying, please be clear about rebuilding the public administration because it has been decimated and that is where delivery happens. State capture has affected every single part of our public administration, from national to provinces to municipalities,” says Mohale.
“It is rotten to the core.”
Ramaphosa has been assuring business that reducing and professionalising the civil service will begin happening “soon”, he says.
The IMF warned recently that time was running out for the government to bring public sector debt under control.
“The country can’t wait,” says Mohale. “But we understand that as the president you have to walk a tightrope, you’re balancing a number of priorities.
“He’s given us an assurance that this is a top priority.”
South Africa needs to build “a professional civil service” urgently, he says. Business has offered to help by seconding people to state-owned enterprises, public institutions such as SARS, the National Treasury and municipalities to build capacity.
The government has accepted. “Malusi Gigaba is coming to see us to say: ‘How do I get rid of the queues at home affairs?’ ”
Mohale says corporate South Arica is fully behind Ramaphosa, and relations between big business and the government have seldom been better.
“This is the most business-friendly government we’ve had in a long time. Ramaphosa has demonstrated that he is willing to listen.”
Where’s the action?
“We said to him, fire the SARS commissioner. And he’s fired him.
“We said to him, institute an independent judicial commission of inquiry into state capture. We now have the Zondo commission.”
Mohale says they’re not happy about indications that it could take at least two years to complete its work.
BLSA has raised the need for speed. “We’ve raised it extremely sharply and urgently. Two years is unacceptable. The president has given us an assurance that he’s giving it his top priority.”
He says business has insisted that it be involved in policymaking.
“If we’re going to second our people, we want to demonstrate that we are heavily invested in saving this country.”
He says evidence of its involvement can be seen in the appointment of new boards at SAA, Eskom, Transnet and Denel, as well as parts of the state of the nation address.
Policy-wise, big business finds little fault with what Ramaphosa has done in his first 100 days, he says.
It even backs him on expropriation without compensation.
“As business we support expropriation without compensation. The president has been very clear this is not a Zimbabwe land grab. It will be done in an orderly and constitutionally sound manner.
“We’re satisfied that section 25 of the constitution deals more than adequately with the issue. It is not necessary at all to change the constitution.”
Nor does he share concerns that the way Ramaphosa has handled the issue, not least announcing his readiness to change the constitution if necessary, will have damaging consequences for foreign and domestic investment.
Mohale was part of a delegation with Minister of Finance Nhlanhla Nene and his deputy to London, Boston and New York, and was at the G7 summit in Canada with Ramaphosa, and says he was assured that it would not damage investment prospects.
“Investors and ratings agencies understand exactly where we are coming from.”
He says they assured them that land reform was possible without threatening property rights.
“In Zimbabwe you had orderless, anarchic land grabs. Here it is very different.”
Isn’t it naive to suppose that investors will risk billions of their clients’ money on the basis of personal assurances that they have nothing to worry about?
“I can speak from personal experience, having spoken to 100 investors in London, Boston and New York, and at the G7.
“The president spent a lot of time and energy explaining it, and we joined him.”
Ramaphosa’s goal of $100-billion (R1.3trillion) in foreign investment in five years will be “difficult but achievable”. The $100billion of domestic investment he seeks is also doable, he says.
Do local businesses have that kind of money?
“Look at the skyline of Sandton, the Discovery building, the Sasol building.”
They’re investing in infrastructure as well as fancy head offices, he says, “and they’ll continue to do that”.
He says business is not overly concerned by recent numbers showing a 2.2% contraction of the economy during Ramaphosa’s first 100 days.
It doesn’t mean that the “New Dawn” is a false dawn, or that their faith in the power of Ramaphoria to save the country is misplaced, he says.
“All of us accept that the president could have done much more, but there is also realism, pragmatism and reality. We accept that. We are business people, not starry-eyed 16year-olds in love.
“We are reaping 10 years of state capture. It will take five years to fix that and five to get to the GDP growth figures we want.”
State capture has affected every single part of our public administration, from national to provinces to municipalities