Ramaphosa’s third SONA tries to mix sobering reality with bold goals

Possibly in an attempt to head off interruptions by the EFF from the start, President Cyril Ramaphosa opened his third SONA by immediately broaching the topic of land.

Noting that the date – 20 June 2019 – was “exactly 106 years to the day” since the Native Land Act came into force, Ramaphosa said the suffering and “untold hardships” caused by this piece of land legislation were “still present with us”.

That set the scene for a sobering introduction to the South African status quo, which the president acknowledged was characterised by “severe challenges”, of which economic issues were foremost.

“Our economy is not growing at the level we want it to grow,” Ramaphosa said. “Not enough jobs are being created in this country. This is the concern that rises above all others.”

A little later, he described the South African economic outlook as weaker than had previously been predicted – a state of affairs he attributed in large part to the “financial, operational and structural problems” faced by Eskom.

In his last SONA in February 2019, Ramaphosa announced the proposed unbundling of Eskom into three separate units – a proposal that has caused ongoing pushback from unions.

On this occasion, Ramaphosa made no mention of the unbundling, but sought to assure the nation:

“Eskom has made much progress in implementing its nine-point plan, ensuring better maintenance of its general fleet, reducing costs and ensuring adequate reserves of coal.”

The president announced that government’s current funding for Eskom – a R69-billion bailout from Treasury in February 2019 – would sustain the electricity provider only until the end of October 2019.

“We will, therefore, table a Special Appropriation Bill on an urgent basis to allocate a significant portion of the R230-billion fiscal support that Eskom will require over the next 10 years,” Ramaphosa said.

This had to be done, the president stressed, because Eskom could not be allowed to fail.

“Eskom is our collective responsibility as a nation,” Ramaphosa suggested, amid sceptical heckling from opposition politicians.

“Further details on this, so we don’t get too excited, will be provided by the minister of finance in due course.”

On the topic of state-owned entities (SOEs), Ramaphosa tacitly acknowledged recent concerns from current SOE leaders by stating that the Presidential SOE Council intended to “create alignment between all state-owned companies and to better define their respective mandates”.

As expected, Ramaphosa’s third SONA was focused largely on the economy, with the president promising the expansion and development of the manufacturing sector. The level of detail on how this would be achieved was low:

“We will implement master plans developed with business and labour.”

Ongoing volatility in the mining sector was ignored, with Ramaphosa pledging the mining sector would be “bolstered” through the long-promised galvanisation of beneficiation activities.

A welcome injection of hard figures came in Ramaphosa’s mention of the R300-billion infrastructure fund which he announced in 2018 would form a key part of his economic stimulus plans. There have been few updates on the infrastructure plans, but the president said that just over R250-billion worth of projects have “entered implementation phase”.

Another of Ramaphosa’s pet projects, the Public-Private Growth Initiative, was also touted as a success story:

“The private sector has committed to invest R840-billion in 43 projects over 19 sectors and creating 155,000 jobs in the next five years.”

Throughout his speech, Ramaphosa moved with some speed from topic to topic, again potentially aiming to forestall objections from parliamentary hecklers. His tackling of the land issue was sandwiched into a wider economic discussion and came and went with such speed that many may have blinked and missed it.

Ramaphosa confirmed the receipt of the overdue report from the Presidential Advisory Panel on Land Reform and Agriculture, but gave no hint as to its contents, which are yet to be discussed with Cabinet.

The president said government would “accelerate efforts” to release state-owned land for urban housing and farming – a task that will fall within the wheelhouse of new Public Works Minister Patricia de Lille.

Ramaphosa also indicated that R3,9-billion had been allocated over the medium term to support black commercial farmers.

And with that, he was on to the next topic.

Youth unemployment is to be tackled through “a comprehensive plan –driven and coordinated from the Presidency – to develop no fewer than 2 million new jobs for young people within the next decade”.

This pledge was one of five “fundamental goals” that Ramaphosa announced for the next 10 years. They are, to say the least, ambitious.

Hunger in South Africa will be eradicated within that time-frame; economic growth will outstrip population growth; every 10-year-old will be able to read for meaning; and violent crime will be halved.

Ramaphosa acknowledged the scale of the task.

“We set these ambitious goals not despite the severe difficulties of the present, but because of them,” he said.

For anyone hoping that Ramaphosa would take advantage of this important platform to stamp his authority on some of the issues which have been roiling the governing party, he took tentative steps in that direction.

He spoke about the role of the Reserve Bank, for instance, affirming the bank as being mandated by the Constitution to “protect the value of our currency in the interest of balanced and sustainable growth”.

Amid heckles from the EFF, Ramaphosa added:

“Listen carefully. Our Constitution also requires that there should be regular consultation between the Reserve Bank and the minister of finance, to promote macroeconomic coordination, all in the interests of employment creation and economic growth”.

Further heckles followed Ramaphosa’s claim that “decisive steps” had been taken “to end State Capture and fight corruption”, but the president ploughed on. He pledged a newly enhanced and fortified NPA, “including to ensure effective asset forfeiture” – adding that public money that had been stolen needed to be returned to fund service delivery.

“We expect that the new SIU Special Tribunal will start its work within the next few months to fast-track civil claims arising from SIU investigations, which are currently estimated to be around R14.7-billion.”

Striving to end on a note of optimism, Ramaphosa urged South Africans to band together, to build a new social compact, and to remember “what we stand for”.

Ramaphosa’s first SONA was memorable for the invocation of Hugh Masekela’s Thuma Mina lyrics with which Ramaphosa concluded his address. His second SONA was memorable largely for the announcement of the unbundling of Eskom.

And his third? It’s difficult to say. Ramaphosa ended his address by quoting from a poem by Nigerian writer Ben Okri, which concludes with the words: “Our future is greater than our past”.

But whether Ramaphosa provided sufficient evidence that this could indeed be the case is very much open to question. DM