22 August 2013
Cabinet ratified the decisions taken at the three-day Cabinet Lekgotla held from August 13 to 15 2013. This Lekgotla reviewed progress made in the implementation of President Jacob Zuma’s 2013 State of the Nation Address.
Ministers and Deputy Ministers met on the first two days and were joined on the third day by Premiers, Directors-General and the South African Local Government Association at the Sefako Makgatho Presidential Guest House, Pretoria.
1. South African Economic Outlook Review
Cabinet considered a briefing on the state of the global and South African economy and the implications of the present economic and geopolitical conditions for inclusive growth, job creation and poverty alleviation.
There are positive developments in the United States, although this is accompanied by heightened volatility in financial markets.
The European economy is showing slight glimpses of growth, but its sustainability remains uncertain.
A new development in recent months is the slowing growth in large emerging economies: China is "slowing down" to about 7.5% and China is in the process of restructuring its economy towards consumption as a driver of growth. India is also slowing to above 5%. This will also have a negative impact on global growth but also impact on-middle sized economies like SA.
Reflecting on the domestic economy, Cabinet noted that growth in the first quarter was lower than expected and levels of investment and employment were below desired levels. The tight electricity demand-and-supply balance is a constraint to growth that requires immediate attention.
Several strengths in the economy were recognised, including strong private sector companies, increased social dialogue and improvements in some manufacturing sub-sectors where government has been intervening.
2. Acting to reignite economic growth
Cabinet recognised that the South African economy can no longer rely heavily on the global economy to reignite growth and create jobs. The focus of government, business and labour must be on accelerated implementation of domestic plans to grow the economy in an inclusive way and create jobs, as well as seizing opportunities in the region.
In this regard, Cabinet decided, among other things, to:
2.1 Act immediately and take steps to resolve the energy constraint by:
- Starting the process towards building Coal 3 while working with relevant stakeholders to speed up co-generation;
- Finalising the process of authorising shale gas exploration in a responsible and environmentally friendly manner;
- Taking steps to encourage projects to enhance regional hydro-power capacity and enter into carefully considered contracts to import energy from the region.
2.2 Improve the regulatory environment through, for example, streamlining licence approvals for water, mining and environmental impact assessments with the view of shortening the approval times.
2.3 Strengthen industrial programmes, including mineral beneficiation projects in the platinum, titanium, iron and steel sectors.
2.4 Accelerate various infrastructure programmes: National Treasury and relevant departments will work with the Presidential Infrastructure Coordinating Commission to unblock procurement processes in infrastructure projects. This will cover priorities in education, health, transport, public works and human settlements.
2.5 Stimulate agriculture and agro-processing for the benefit of rural development and job creation by finalising the Agricultural Policy Action Plan in partnership with the sector by the end of next month, September 2013.
2.6 Upscale youth and public employment schemes through a new phase of the Extended Public Works Programme and expansion of the Community Work Programme. This will include implementation of youth employment incentives and the employment tax incentive for Special Economic Zones.
2.7 Stabilise the mining sector by supporting the Framework Agreement for a Sustainable Mining Industry as led by the Deputy President. Government will continue implementing its key commitments under the Framework to help stabilise the industry.
2.8 Improve support to small businesses by, among other things, creating a one-stop shop and portal for SMME’s. This will start with the alignment of SMME programmes across all government spheres and departments and will be launched by the end of this year.
Ministers leading Outcome 4 – Decent Employment Through Inclusive Growth will prepare an action plan to give effect to the aforementioned proposals by September this year. These implementation plans will see government acting on key elements of the National Development Plan as part of speeding up implementation of Vision 2030.
3. Mid-Year Progress update
Also at the Lekgotla, Cabinet discussed a number of progress reports on the 2013 Programme of Action, with a focus on rural development, education, health, and justice and crime prevention.
The Lekgotla noted that key programmes, such as infrastructure development, were progressing well in general but that some delays had set in.
Substantial progress was noted in most of the service delivery areas, including the following:
- An increase in public spending on early childhood development;
- Bursary funding of R5,68 billion by the National Student Financial Aid Scheme, compared with R2,3 billion last year;
- Commencement next month (September 2013) of construction of two universities;
- The delivery of 114 million workbooks to all learners in Grade R to 9 plus supplementation of these with workbooks for life skills and language in Grade 1 to 3;
- Advances in the fight against HIV, AIDS and tuberculosis, including increased uptake of antiretroviral treatment. This builds on the achievement of a 50% decrease between the 1990s and 2011 in the number of people who became infected in HIV;
- A number of Strategic Infrastructure Programmes (SIPS) that are co-ordinated via the Presidential Infrastructure Co-ordination Commission are on track.
- The policy on the Office of the Valuer-General has been implemented and generally the implementation of the Consolidated Rural Development Programme in most rural wards is on track.
- Having noted that official crime statistics are to be released in the coming weeks, the Justice, Crime Prevention and Security Cluster reported to the Lekgotla progress towards ensuring that all South Africans are and feel safe. This includes the reintroduction of Sexual Offences Courts; increases in crime detection rates; reductions in case backlogs; significant conviction rates for serious crimes, and the freezing of criminal assets. The protest actions by communities distract police from dealing with crime.
4. Looking ahead
The Lekgotla noted that some projects that were lagging behind agreed schedules, and urged all concerned to ensure that these projects were brought back on track.
Cabinet adopted various action plans to ensure that all commitments for 2013/14 are met in the remaining months of the current administration.
Cabinet further discussed the framework for the Medium Term Strategic Framework for 2014-2019, which will form the first building block for the implementation of the National Development Plan.
Cabinet agreed that further consultations need to take place between the Department of Performance Monitoring and Evaluation and line function departments to refine the list of programmes and actions to which departments will commit for 2014-2019.
The Framework will be finalised after the 2014 election and will form the basis of the programme of action for the new administration.
Cabinet is confident that life has changed for the better since 1994 and that since 2009, the current administration has consistently delivered on its mandate.
Government commends the private sector, civil society formations and individual citizens on their efforts to make South Africa a better place to making South Africa a better place.
Our achievements to date are the result of a national effort that we must sustain to realise the National Development Plan’s Vision 2030.
Issued by Government Communications (GCIS)
Enquiries: Phumla Williams (Acting Cabinet Spokesperson)
Contact: 083 501 0139