Politics.za

From The Weekender

THE treasury has questioned whether the R8,4bn it is investing in the construction and refurbishment of stadiums for the 2010 Soccer World Cup will ever generate a return, and not end up being a costly noose around the necks of ratepayers.

Malcolm Simpson, the treasury deputy director-general in charge of the 2010 World Cup preparations, conceded that with hindsight SA should have considered the future viability of the stadiums before bidding, but said “this is (now) history”.

As if people weren’t warning government from the very start about the fact that building new stadiums from scratch in a country where soccer teams struggle to fill half their homes stadiums (unless it’s a Kaizer Chiefs/Orlando Pirates derby) might be a bad idea.

Cape Town’s stadium is a particularly bad investment that is being built in Green Point solely it seems so there will be nice sweeping shots of the stadium, Table Mountain and the sea in one take. Whether it will actually be useful afterwards is another matter.

Sometimes even the golden boy of SA politics, Trevor Manuel, is so bound by the rules of obedience to the party that he’s forced to utter some non-sensical mutterings every now and then (we hope). Take his recent statements in parliament over that constant thorn in the government’s side, our northern neighbour Zimbabwe:

“We must encourage Zimbabweans to solve their own problems. That is the most we can do because the decisions have to be carried by Zimbabweans into perpetuity,” Manuel said in a heated exchange in parliament.

“For those who don’t understand, I ask that President Bush recruit them and send them to Iraq,” a visibly angry Manuel said amid heckling from opposition lawmakers.

“Then they will understand what regime change is about.”

Sure the Zimbabweans have to make the change themselves but it’s a bit hard to do so when you’re starving and the army and police seem to be getting all the food. Also the quiet diplomacy tactic is a bit strange when you consider the considerable international support the ANC raised against the Nationalist Apartheid regime.

Manuel – one of Africa’s most experienced and respected finance ministers – said that South Africa would not squander South African taxpayers’ money by bailing out the ailing Zimbabwe economy.

“We can not… decide what kind of economy the Zimbabweans must have. They must get the prices to work, they must drive the changes. We can’t commit financial resources …”

Well if we’re not going to be spending taxpayer money on Zimbabwe I assume we’ll be cutting those Eskom powerlines into Zimbabwe pretty soon? Also I would think my taxes which are spent on social services for the 4000 to 5000 Zimbabweans who jump the border every day might be better spent on SA citizens first.

For service delivery to happen, government needs to spend money. Lots and lots of money in the particular case of South Africa. Every year SARS collects a record amount of tax revenue ready to be distributed to all level of government and used in their fight against poverty. Despite receiving all that money local government just can’t seem to spend it all.

With only 27.4 percent of the budget spent by the end of February and three months to go before the end of the 2006/07 financial year, Mayco member for corporate services Belinda Walker said on Wednesday it was not only a lack of capacity prohibiting budget spend, but also procurement legislation.

It is not a good sign that Cape Town local government has only managed to spend just over a quarter of it’s budget when three quarters of the financial year has passed. It’s unclear if all the blame can be laid at the foot of national treasury legislation holding up spending at municipalities, but if there’s to be any hope of meaningful service delivery both local and national government need to sort this kind of problem out.

Despite the constant murmuring of growing corruption let’s not forget that the largest case of corporate thievery in SA history was still carried out by us whiteys.

Fidentia’s curators have now estimated that close to R1 billion Rand has gone missing.

When it comes to white (no pun intended) collar crime, we’re still number one!!

We’ve written before on this blog about the seemingly contradictory effect that BEE might actually be good for white South Africans by forcing them to be more entrepreneurial. A 2003 survey by the Bureau of Market Research found that between 1998 and 2002 the growth in entrepreneurs across racial divisions was as follows

That’s not exactly encouraging numbers for black entrepreneurship and because the black segment accounts for 80% of the population a decrease that large in black entrepreneurs will lower the total number of entrepreneurs in South Africa. That is a definitely not a good thing.

A new survey by Finscope has found that most black small businesses are trapped in “survivalist mode” and that only 8% of all small businesses were taking advantage of government small business support. Black entrepreneurs who do succeed quickly find themselves targets to be hired or bought out by large firms looking to source talented black executives.

If small business and entrepreneurship is to be the saviour of the South African economy as government keeps on saying it will be then the growth in entrepreneurship amongst the black segment of the population needs to reverse course and head into positive territory extremely quickly (if it hopefully hasn’t done so already). Government will also need to start supporting small business earnestly, the focus on multi-billion Rand BEE deals with multinational corporations is a bit too much for my liking.

Update: On a partially related tangent: South Africans join the ANC to advance their economic interests

Tomorrow Trevor Manuel will be presenting his 11th national budget and the media is full of speculation about who’s going to get their slice of the pie.

• Will Manuel scrap exchange controls?
• Budget to be robustly redistributive – FNB
• Give business tax breaks, is DA’s tip for Trevor
• Market to smile on Manuel
• Budget: prepare to pay for your sins

Update: And here it is.

The 2007 budget speech is barely 3 weeks away so don’t forget to send in your Tips For Trevor before it’s too late.

Yikes! The Eastern Cape provincial government can not account for 88.5% of it’s budget. Of the total budget of R34.1 billion for 2005/6, R30.2 billion is unaccounted for.

Still fresh after putting the spotlight on transport issues Trevor Manuel has decided to lay his skeptical gaze on housing. Now this is actually quite interesting as Manuel seems to be publicly casting doubt over the achievements of a fellow minister. I’m sure Minister of Housing Lindiwe Sisulu would have liked to have held up the estimates of close to two million houses supposedly built for the poor as an achievement but Manuel has come out pretty quickly not only casting doubt over the actual number of houses built but also asking why government spending has doubled on housing but delivery has slowed.

One of my pet issues is transport so it’s good to see the current major transport crises facing Cape Town and Johannesburg being put in the spotlight by Minister of Transport... Finance Trevor Manuel (is there anything he can’t do?). It’s a really big problem in my mind because the lack of public transport is a literal stranglehold on the economy.

I guess Minister of Transport Jeff Radebe is a bit busy trying to prevent the Taxi recapitalisation programme from going down in a fiery ball.