LETTER: Speech devoid of a plan - Business Day, 28 October 2016

Our reading was of a government fiddling, without a plan. There were no announcements on structural reforms, only the now familiar commitments to more taxes and austerity and the need to work together. But you cannot grow an economy out of trouble by taxing its productive sectors more and spending less money. Nor is t

 

By Frans Cronje 

 

Your editorial (State of the nation, October 27) refers. You write of inspirational and visionary leadership, of stepping into the breach, and striking balances on growth and taxation.

Our reading was of a government fiddling, without a plan. There were no announcements on structural reforms, only the now familiar commitments to more taxes and austerity and the need to work together. But you cannot grow an economy out of trouble by taxing its productive sectors more and spending less money. Nor is there any need to urge South Africans to start working together. Our polls show they are ready to go, but the obstructive ineptitude of the government holds them back.

The same goes for the private sector that wants to invest but cannot because of the uncertain and hostile policy environment crafted by the Cabinet. The quoting of Mandela and Tambo is a fig leaf to conceal the fact that we still have a Cabinet that in areas from mining to manufacturing and agriculture is pushing ahead with policies that will deter investment. There has been no reform of parastatals — just look at who still leads the national airline.

Without structural reforms Finance Minister Pravin Gordhan’s 2017 growth numbers are unrealistic. SA needs firm decisions to deregulate the labour market, reform empowerment policy, secure property rights and sell state-owned enterprises if it is to have any chance of staging a growth recovery. There was very little of that in the minister’s speech.

Frans Cronje
CEO, Institute of Race Relations 

Read letter on Business Day here

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