Take the hard decisions, Busa urges Ramaphosa

IT WAS TIME for the hard decisions, Business Unity SA (Busa) said in a statement yesterday, prior to tomorrow’s State of the Nation Address (Sona).

This as Statistics SA’s quarterly labour force survey for the fourth quarter yesterday showed unemployment remained unsustainably high.

Busa said it had consistently appealed to President Cyril Ramaphosa and the government that they needed to take hard decisions to attract investment and put the economy on to a sustained growth path.

“We have recognised, and applauded, some progress in areas of addressing corruption and rebuilding institutions, but have lamented the fact that there has been no movement on the economy, which is central to addressing the crisis we are in.”

Last month Busa, at the opening of the second annual Business Economic Indaba 2020, urged President Cyril Ramaphosa to grab the bull by the horns and take decisive action and more quick-footed responses.

Yesterday it said that South Africa was in the throes of a severe fiscal crisis. “Because the economy won’t grow and South Africa is borrowing at high interest rates, unless the government cuts spending significantly it will be impossible to stop debt from rising inexorably,” it said.

Three years from now, debt would have grown from R3 trillion to R4.5trln, according to the Treasury’s projections. Debt service costs will increasingly crowd out funds for education, healthcare and other essential services, inflaming the poor who are already up in arms over the government’s appalling service delivery, it said.

The Sona, to be delivered tomorrow, was a critical opportunity for Ramaphosa to send out a clear message that his government recognises the crisis the country is in, and is ready to take the hard decisions to address the crisis, it said.

“We continue to talk about progress on process and procedure, but this is not real progress: starting a process to make licensing independent producers easier is not the same as issuing a licence so that building can begin. Hence the need for hard decisions.” Busa said that it would like to see, among others, the following in the Sona:

Urgent pronouncements on far-reaching economic structural reforms, with the key aim of unleashing economic growth and attracting investments.

A clear statement that public expenditure will be tempered in the Budget to be presented on February 26. “This is in the context of addressing the fiscal crisis we are in,” it said.

A clear position on a strategy to address the state-owned enterprise (SOE) crisis.

“This must include decisions on which SOEs are of strategic importance, the role of the private sector, poor governance and management and a lack of qualified people. The statement must also assure the public that there will be no political interference in the operations and governance of SOEs.”

Busa said it wanted a clear position on Eskom, which included the appointment of a capable and independent board.

It wanted the Minister of Minerals and Energy to urgently announce regulations to enable private sector energy generation at scale. Such regulations must include making the ministerial new generation determinations necessary, in concurrence with Nersa, to initiate renewables and gas procurement as required by IRP19. This would enable Round 5 of the Reippp to be implemented immediately. Schedule 2 of the Electricity Regulation Act must also be amended immediately to lift licence exemption from 1MW to 10MW.

Busa also called for clear and precise implementation milestones for members of the Cabinet.

It wanted the president to also ensure that there would not be mixed messages from different parts of the government, such as the “current debacle” around SAA.

Busa wanted Ramaphosa to ensure positive messages from all of the government to attract investment and promote growth.