By Lehlohonolo Lehana.
President Cyril Ramaphosa has unveiled a plan to revive South Africa’s flagging local governments, weeks after publicly criticising the state of the financial capital Johannesburg.
Ramaphosa launched the second phase of Operation Vulindlela at the Union Buildings in Pretoria.
Operation Vulindlela was established in October 2020 as a joint initiative of the Presidency and National Treasury to accelerate the implementation of structural reforms.
In its first phase, the operation focused on reforms in five key areas with a high potential impact on growth and jobs: energy, logistics, telecommunications, water, and the visa system. 35 reform actions were prioritised across these five areas, with government departments and agencies taking responsibility for implementation while a dedicated Vulindlela Unit in the Presidency and National Treasury monitored progress and provided support.
Operation Vulindlela aims to modernise and transform network industries, including electricity, water, transport and digital communications.
Ramaphosa said the economy is already starting to reap the benefits of the operation, and changes are attracting private investment.
“I commend in particular the ministers, deputy ministers, directors-general and CEOs that have provided leadership to these efforts,” he said.
“Over the last four years, Operation Vulindlela has become a government-wide initiative. This is meaningful progress, and it will enable higher growth in the years to come.”
Our economy needs to grow, everyone agrees, in the GNU and outside the GNU. It needs to grow much faster to create the jobs that our country needs to achieve the prosperity that we all yearn for,” he added, nodding to the fact that the reform initiative was one thing on which his party and its coalition partners agreed.
“Growth is the only way to achieve fiscal sustainability, and social progress in our country.”
Ramaphosa said this was why the coalition government committed itself to sustaining the momentum achieved by Operation Vulindlela in its reform agenda, adding that these reforms had a direct impact on the lives of South Africans.
“So we need bold, far-reaching reform initiatives to revive and reshape our economy. Our immediate priority is to follow through on the reforms that we have initiated and the reforms that are already underway so that they can reach their full impact
Ramaphosa highlighted the local government reform, spatial inequality, and digital transformation as key focus areas.
Spatial inequality
“We will address the apartheid legacy of spatial inequality, which has forced millions of South Africans to live far from economic opportunity,” Ramaphosa said.
“The poorest South Africans spend as much as 40 percent of their income on transport to get to work, more than almost any other country in the world. The structure of our cities has to change to enable people to access work,” he added.
The president said this meant changing the country’s housing policy to allow people to choose where they want to live through subsidies for home ownership and affordable rentals.
Ramaphosa said the government would accelerate the release of publicly owned land and buildings for affordable housing, with a particular focus on inner cities.
In addition, it will clear the backlog of title deeds for affordable housing while making the titling system more accessible and affordable.
Local government
The president took aim at Johannesburg’s decline in March, highlighting the urgent need for intervention so that it “can improve immensely”.
Nicknamed the “City of Gold” for its roots in the gold mining industry, Johannesburg is South Africa’s economic hub and hosts the wealthiest square mile on the continent.
Yet parts of the sprawling metropolis of nearly five million are in a state of disrepair, from crumbling infrastructure to unreliable service delivery, blamed on mismanagement and poor governance.
Acknowledging that municipalities are struggling with delivering basic services to homes and businesses, Ramaphosa said the aim of the joint operation is to improve local government’s performance.
The agenda is clear, he said, and it starts with improving the delivery of water and electricity services through professional utilities that have the right technical skills, strong regulation and oversight, and full control of their billing and revenue functions.
Digital Transformation
Ramaphosa said Cabinet approved a Digital Transformation Roadmap last month to drive the adoption of digital technologies in government and to build digital public infrastructure that can be used by all South Africans.
“This will include a digital identity system, rapid payments to expand financial inclusion, and enabling people to access services like applying for an ID or passport online.”
The National Treasury said driving structural transformation of the economy was the rationale for pursuing additional reforms in Phase II, approved by Cabinet in March this year.
While he said there had been some progress since its initial implementation, finance minister Enoch Godongwana said that sustaining the current momentum was key to seeing results.
“The immediate priority is therefore to sustain the momentum already developed and follow through on the implementation of existing reforms in order to realise their full impact. This will require completing the reforms underway, as well as deepening those reforms which have already been initiated, in the energy, logistics, and water sectors and visa regime.”
Godongwana admitted that it would not be an easy feat.
“The road ahead is challenging, but with agility, commitment to reform, we can achieve greater competitiveness and a more inclusive economy in line with this administration’s priorities.”