There was nothing inherently wrong with the way funds have been allocated to sectors in the budget. South Africa has been fortunate not to have been badly affected by the recession. It has an abundance of resources compared to other countries in Africa. The problem lies in a lack of ideas, a lack of a sense of how to tackle unemployment. South Africa’s major challenge is about a failure of vision, a lack of capacity, and a damaged social fabric (eroded by greed and self-enrichment). Unless dealt with decisively, funds will continue to be poorly utilised.
Government is right to highlight unemployment as the priority. How it proposes to deal with it needs much more work, refinement of strategy, and a different way of working. Attempts to introduce a focus on pilot initiatives in employment generation are to be lauded. Hopefully this signifies some acceptance that current strategies are not working? For too long government has been punting the one-size-fits-all cooperative model. Despite consistent failure it has continued to allocate substantial resources to this approach. There is nothing wrong with the concept, but when it is aggressively promoted as the panacea, whilst enticing people to form cooperatives with promises of loans that are invariably converted into grants, there is little hope of a successful programme.
There are signs that government accepts its current strategies of enabling the poor to develop livelihoods is flawed. They have looked to India, to the self-help group movement, to Kenya for their financial cooperatives. By now they should have learned that importing foreign models, and applying them as supply-driven programmes without testing them, is not going to work. A fundamentally important develop principle, that government seems to overlooked, is that it is essential to create an enabling environment for the poor to engage in their own activities and processes, to assume their own agency over their lives. It is essential therefore to create opportunities for the poor to build on what they know and indentify with. This is a solid foundation for pathways out of poverty. Handouts and promises are not helpful.
One of our unique features is a deep culture of group-based saving. Instead of introducing elaborate models from abroad, there is a rich tradition and commitment to collective savings and action on our doorstep. Sustainable livelihood specialists, such as Robert Chambers, will be challenging us to assist people to build on local assets and opportunities. This is one of them. Across Africa, NGOs are promoting a simple model of group-based saving and lending. Since this movement developed, some 3 million people have formed such groups, groups that are not dissimilar to their traditional savings groups, but which are without the risks and recurrent weaknesses that tend to manifest.
A handful of local NGOs in South Africa have begun applying such models. Indications are that they can have a major impact on enabling the poor and vulnerable (including people living with HIV/AIDS) to find pathways out of poverty. Government should take note. They too are not a panacea, but the model is scalable and provides a strong foundation for action. Throwing more money at cooperatives, the Kulas, the SAMAFs and related institutions, is like throwing good money after bad. If the foundation is not solid, no amount of extra funds will fix it.
It is time government conceded that it cannot address poverty on its own, that it reengages with civil society, and develops enabling facilities for community-based programmes that show promise.