Municipal under-spend costs jobs

If President Jacob Zuma and his cabinet could persuade and assist local and provincial governments to fully and properly spend their annual budgets, it would go a long way towards meeting government’s promises and targets for job creation.

Delivering the African National Congress  national executive committee’s traditional  annual January statement at the occasion of the ANC’s 99th birthday celebrations on 8 January at Polokwane, President Zuma indicated that government will rely more on the capacity of the state and that of state-owned enterprises and development finance institutions to fight unemployment.

His emphasis on the role of the state also echoed minister of economic development, Ebrahim Patel’s New Economic Growth Path (NEGP), released late last year.

The plan is expected to be rolled out this year, as the cabinet tries to put its stamp on the country’s economic direction and especially come to grips with the vexing  problems of unemployment and so-called jobless growth of the last decade and a half.

Under-spend cost jobs

In the meantime, however, it is estimated that some 800 000 potential job opportunities did not materialize during the previous financial year due to the failure of local and provincial government to spend their allocated budgets.

In December of last year the department of public works, in reply to a parliamentary question by the Democratic Alliance revealed that 226 231 job-opportunities were lost because of the failure by district and local municipalities to spend money made available under the Extended Public Works Programme (EPWP).

At provincial level the non-creation  of potential jobs counted up to nearly 540 000 due to under-spending under this heading, which was introduced by national government in 2004. The intention of the programme is to create short- and medium-term employment and in-service training opportunities.

Trade unions have also often criticised the programme because the jobs created under the scheme are not of a permanent nature and are said to only produce minimum remuneration.

According to the reply by the department:

• Local municipalities in Limpopo province spent only 27% of their budgets under the EPWP, leading to the loss of 13 601 potential job-opportunities;
• Under-spending in the North West province was responsible for the loss of 11 456 potential job-opportunities; and
• In Mpumalanga province the loss of potential job-opportunities due to under-spending at local government  level numbered 10 360.

Under-spending of allocated EPWP funds at district municipalities and metropolitan councils also led to a considerable loss in potential job opportunities. This includes:

• The loss of 8 323 opportunities at the City of Cape Town;
• eThekwini-metropolotan council (Durban) saw the loss of 9 057 job opportunities;
• The Johannesburg metropolitan council’s failure to spend its full allocated budget under the programme cost 14 749 jog opportunities; and
• At the Nelson Mandela Bay metropolitan council in the economically struggling Eastern Cape Province no fewer than 16 749-job opportunities went un-untilised.

Some concerns

Some critics of the NEGP have expressed concern about what they believe is an over-reliance on the capacity of the state. They argue that as the state and state-owned enterprises are largely in managerial disarray, they may not be well-placed to drive the plan.

The NEGP aims at reducing unemployment to 15% (according to Statistics South Africa it is presently at 25.3%) over a period of 10 years by, among other things, using the state as a major employer, which is a departure form the notion that the state should simply provide an enabling environment for job creation.

While he did not give much detail, and some of it might come to the fore in his state of the nation speech at the opening of parliament and during  the debate on the speech, President Zuma in his Polokwane statement said unemployment will be addressed through practical measures and that 2011 “will be the year of job creation through meaningful economic transformation”.

Public sector programmes

He said the government would explore public-sector employment in health, education, policing, social services and  community and public works programmes to improve service delivery and the quality of life.

“All department will be required to put the appropriate programmes in place and establish the right environment for the creation of many decent and sustainable jobs in every way possible.”

He said structural challenges in the economy continued to sustain South Africa’s unequal society with its crisis of unemployment.

“It is only by enabling our people to free themselves from poverty, by providing decent and sustainable jobs and opportunities to become entrepreneurs that we will really bring about a better life for all,” he said.

He also said that government will make sure that public procurement was used to support domestic manufacturing, which should lead to more jobs being created in that sector.

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Comments (3)

• |2011-09-02 09:00:24 Mdakane Samkelisiwe  - Inservice training
  Dear Sir/Madam!
  I'm Samkelisiwe Portia Mdakane, a third year student at Mangosuthu University of Technology. I'm towards my N.Diploma in Construction Management & Quantity Surveying. I'm looking for an inservice training of six months in order to graduate.
  
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• |2012-02-22 16:24:11 pilani dlamini  - mr
  Hi I am pilani p dlamini, I am looking for an inservice training. I have just finish my N6 civil engineering at swinton coastal college. I need 18 mnts learning practical so that will obtain my national N diploma. I'm looking foward hearing from you thank u.
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• |2012-05-03 15:02:31 senzo  - mr
  I'm Senzo U Sithole currently studying Public management third on my diploma at Durban University of Technology (dbn), inservice training is compulsury in order for me to graduate next year. the duration of inservice training is only three months, it would be a pleasure if my qeruest conciderd.THANK U
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