Our klep­toc­racy is pick­ing pock­ets of the poor­est

Weekend Argus (Saturday Edition) - - FRONT PAGE -

TWO STARK sets of statis­tics re­leased this week should give all South Africans pause. They col­lec­tively en­cap­su­late the deep cri­sis our coun­try is in.

The first set, from the In­sti­tute of Race Re­la­tions, looks at so­cial grants, the most im­por­tant mech­a­nism the ANC gov­ern­ment has in­tro­duced to bring relief to the poor­est of the poor. The grants, to the aged and dis­abled and for chil­dren, are also crit­i­cal for the ANC to keep its grass­roots voter sup­port.

Last year was some­thing of a tipping point for SA, the in­sti­tute’s anal­y­sis shows. For the first time the num­ber of peo­ple on wel­fare ex­ceeded the num­ber of peo­ple who have jobs.

Last year there were just over 17 mil­lion peo­ple get­ting so­cial grants. Those grants are funded, through tax­a­tion, by the ap­prox­i­mately 15.5 mil­lion peo­ple who had jobs.

With the eco­nomic down­turn – more jobs lost and more peo­ple in need of gov­ern­ment sup­port as the coun­try moved into re­ces­sion – that pic­ture undoubtedly will have wors­ened in the past six months.

In­sti­tute an­a­lyst Ger­brandt van Heer­den is blunt: “The numbers are a recipe for so­cial and political chaos… The gov­ern­ment will have to cut other ar­eas of ex­pen­di­ture in or­der to meet pop­u­lar de­mands for more and higher grants. We pre­dict that this will lead to much higher lev­els of vi­o­lent protest ac­tion.”

This grim tra­jec­tory is best viewed over a 15-year pe­riod. In 2001 there was a frac­tion un­der 4 mil­lion peo­ple re­ceiv­ing grants, with 12.5 mil­lion work­ing. While em­ploy­ment last year had in ab­so­lute numbers in­creased by 24%, those re­ceiv­ing grants had rock­eted by 328%.

This is clearly un­sus­tain­able. As the in­sti­tute points out, there is enor­mous political pres­sure, not only to con­tinue expanding the roll­out, but also to in­crease the value of ex­ist­ing grants. But that is well nigh im­pos­si­ble, which means liv­ing stan­dards for the most vul­ner­a­ble peo­ple in our so­ci­ety will stag­nate and then de­cline.

“The con­se­quences for so­cial co­he­sion will be se­vere as in­equal­ity in­creases. The pend­ing grants cri­sis will trig­ger much suf­fer­ing and des­per­a­tion in al­ready poor communities.”

It is a dire sit­u­a­tion fur­ther ex­ac­er­bated by the na­ture of Pres­i­dent Ja­cob Zuma’s ad­min­is­tra­tion, a de facto klep­toc­racy. Not only is there less to steal, be­cause of this weak­en­ing tax base, but also the lev­els of lar­ceny are in­creas­ing.

State cap­ture by Zuma-favoured elites is no longer a pos­si­bil­ity but a real­ity. Re­sources that should be go­ing to grow­ing the econ­omy are being sys­tem­at­i­cally looted at ev­ery level of gov­ern­ment.

The sec­ond set of statis­tics comes with the re­lease of Au­di­torGen­eral Kimi Mak­wetu’s re­port on 2015-16 au­dit out­comes at lo­cal gov­ern­ment level – the level at which the state can most read­ily and most rapidly in­ter­vene to im­prove the lives of the dis­ad­van­taged.

Mak­wetu notes a “mar­ginal im­prove­ment” in the lev­els of mis­man­age­ment, in that ex­pen­di­ture in the “fruit­less and waste­ful” cat­e­gory was down by 21% and in the “unau­tho­rised” cat­e­gory re­mained much the same, at R12.8 bil­lion. How­ever, “ir­reg­u­lar” ex­pen­di­ture, in which fi­nan­cial con­trols were flouted, was up on the pre­vi­ous year by a whop­ping 50%, to R16.8bn.

That lat­ter fig­ure is a con­ser­va­tive es­ti­mate. It is prob­a­bly much higher be­cause in a third of the mu­nic­i­pal­i­ties fi­nan­cial con­trols are so poor no one has a clue of the ex­act amount spent ir­reg­u­larly.

Only 49 out of 263 mu­nic­i­pal­i­ties man­aged clean au­dits. And, ac­cord­ing to the au­di­tor-gen­eral, 27% of SA’s mu­nic­i­pal­i­ties are sim­ply not sus­tain­able.

But the prob­lem here is not one of in­com­pe­tence. It is one of political will.

In the DA-gov­erned Western Cape, 80% of mu­nic­i­pal­i­ties re­ceived clean au­dits. The next best prov­ince was the ANC-run KwaZulu-Na­tal, with a pa­thetic 16% clean au­dit.

In Gaut­eng, only the DA-run Mid­vaal metro got a clean au­dit, for the third year in a row. In con­trast, the three met­ros the DA won in last year’s lo­cal gov­ern­ment elec­tions – Jo­han­nes­burg, Nel­son Man­dela Bay and Tsh­wane – all racked up stag­ger­ing lev­els of mis­spending.

This is only at a lo­cal gov­ern­ment level. The sit­u­a­tion is no less alarm­ing at pro­vin­cial and na­tional gov­ern­ment lev­els. KPMG has cal­cu­lated that by just curb­ing the R49bn mis­spent by the na­tional gov­ern­ment each year, SA could pay ev­ery so­cial grant re­cip­i­ent an ex­tra R233 a month. So when it comes to “rad­i­cal eco­nomic trans­for­ma­tion”, the left should worry less about that imag­i­nary bo­gey-man, white monopoly cap­i­tal. The real is­sue to be grap­pled with – some­thing of a chal­leng­ingly rad­i­cal con­cept to the com­rades – is that the ANC should stop pick­ing the pock­ets of waifs and or­phans, the dis­abled and aged.

Fol­low WSM on Twit­ter @ TheJaun­dicedEye.

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