ANC policy turns away from nationalisation

City Press – 17 June 2022

It can no longer be nationalisation at all costs for the ANC, especially if it will cost the country dearly.

This is the opinion of the head of the ANC’s subcommittee on economic transformation, Mmamoloko Kubayi, who is also the minister of human settlements, regarding the party’s policy change from radical economic transformation in 2017 to the rebuilding of the economy this year.

The subcommittee is responsible for drafting the ANC’s economic policy proposals in the run-up to the party’s policy conference at the end of next month.

At the ANC’s national conference in December 2017, the controversial resolutions passed included the nationalisation of the SA Reserve Bank, as well as land expropriation without compensation – both of which ultimately failed.

Kubayi says that, at the time, it was not realised what impact such policy proposals would have on the markets, and that such policy decisions need to be reconsidered in the current economy.

“Take, for example, our decision to nationalise the SA Reserve Bank – as soon as we announced that, private investors reacted [negatively],” Kubayi said in an exclusive interview this week.

“On the land issue and the issue of land expropriation without compensation, we’re going to have to report that we no longer have the majority in Parliament to implement this,” she admitted.

“People were moreover scared, because their frame of reference was the Zimbabwean example – it was never the ANC’s intention to do so.

That’s why food security protection is now such an important aspect of our policy documents.

Kubayi believes there will now be a need to fall back on the rhetoric of various organisations in the run-up to the failed amendment of the Constitution to make land expropriation without compensation explicit.

At the time, several organisations made it clear during parliamentary submissions that land expropriation without compensation could, in some cases, already take place under existing legislation.

According to Kubayi, who has served in the Cabinet in a series of portfolios since 2017, land expropriation can now be managed from her portfolio, but she concedes that the ANC has to take a policy leap on this.

“It can’t be nationalisation at all costs – and at the expense of the country. These are some of the things we’ll have to reflect on at the policy conference,” she said.

The current political climate differs greatly from the one that existed in December 2017.

And for Kubayi, it is becoming increasingly difficult to convince the public that the ANC is still the right vehicle to take the country forward.

“We’re at a point where we want to talk about policy by saying, ‘Here’s our policy framework’ – but people don’t want to hear any more about policy, they just want to know what we’re going to do, when and how.

“It’s not only the Russian war on Ukraine, it’s not only Covid-19 [that is making the economic climate difficult], it’s also the years that the ANC’s been in government.

“That’s why it’s difficult to constantly answer questions about why people should believe us now. [They say]: ‘You were [already] in control back then and some of these changes you’re talking about should have taken place a long time ago.’ It’s a difficult balancing act,” she says.

So how does she do it? Kubayi admits that the ANC cannot distance itself from the years of state capture.

“The first important thing is to acknowledge where the problems were. To be sincere, clear and transparent by saying what went wrong, what we should have done and what we shouldn’t have done,” she says.

As for the new plans, she added: 

We have to start talking about the future, about a meritocracy. Merit must come above all else.

“We have to get the right people to do the right jobs. If we can get the right people – qualified, competent people to run organisations, competent people to run government – then we’ll see the necessary results.

“With our [new] policy, we want to remove rhetoric and slogans, and rather focus on what will really change [people’s lives].”

She believes that the issue of regulating and protecting informal traders is one of the first things that needs to be addressed so that “people can get a foot in the door”.

“It’s critical [that people should be economically active]. People’s dignity is taken away if they can’t take care of their families. Our idea is that, if you’re an informal trader, you should be able to walk into a municipality and get a permit so that you can trade.

“These people shouldn’t be asked for something like three months’ bank statements. At the moment, they’re almost treated as if they were criminals, while they’re an economic entity.

“This is an area filled by mostly black women – who’re at the bottom of the economy – and we believe that if we let them go on doing business, we’ll start to get many more economically active people.”

According to Kubayi, however, it is not good if there are people who are economically active, but they are not provided with the electricity to remain so.

“In the [new] policy, we’ve accepted that in the generation of power, there should be private roleplayers, so there will be such participation – despite arguments [at government level].

But when it comes to transmission, we don’t believe it should be privatised, because we don’t want people to depend on a private person to decide whether or not they can receive power.

Are partnerships with private companies what lie ahead for all state entities?

Kubayi believes these are inevitable for some: “I learnt for the first time this week about an entity in public works that deals with innovation. Given the fact that I didn’t even know about this entity, how relevant is it, really?”

It worries her that there are entities “trying to hide”.

“We spend the fiscus [money] on them – we pay salaries, office rent and all this stuff – but we can’t do that if we don’t know what their impact on the country is.

“There are entities that we have to get rid of, unless we can benefit from them and then we can start commercialising a partnership. That’s how the economy should work.

“I know it’s going to be problematic, but these are talks that need to take place.”

However, she added that there were strategic entities – such as struggling state-owned arms manufacturer Denel – that needed to remain under state control.

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