South Africa’s Social Investment Context in 2010

Wednesday, 13 January, 2010 - 11:46

Tshikululu Social Investments has prepared a short context document that looks at South Africa's political, socio-economic and company legislative environment (with an emphasis on matters affecting social investors). The report entitled ‘South Africa’s social investment context in 2010’ serves as a short introduction to the year ahead

1. The Political Environment

1.1. Grace before the meal
The very essence of “politics” is the human intercourse about how we are governed, where we are going, what our context is, where we find ourselves among broader humanity, and the essential and ever-changing debate about how best to divvy up limited resources.

This very short overview will not attempt to discuss politics in any depth as to do any justice to politics in such a space would be incredible. Rather, this summary tries to give an overview of broader trends affecting political and societal development and allows readers to draw their own conclusions.

1.2. Society’s political make-up
Last year’s general election results continue the entrenchment of the one-party dominant state. This should not be surprising. After all, there is no society on Earth whose history is characterised by deep racial, ethnic or religious division that has seen voters cross these divides in significant numbers with the advent of democracy. This isn’t to say that this can’t happen; just that it never has, with the remarkable exception of the United States in its election of Barack Obama as president in 2008. Nevertheless, the 2009 April election results did signify significant change in some ways. The ANC saw its core support base shift ethnically and geographically to KwaZulu-Natal for the first time. In this province the ruling party did exceptionally well, and in every one of the other eight provinces it saw its support merely consolidate or more likely dip, if in some more spectacularly so than others.

Opposition parties also saw change, with a slow consolidation of voters taking place under the official opposition DA to the detriment of the IFP, FF+, UDM and ID. The PAC and Azapo were virtually destroyed and the newcomer Cope has subsequently seen its initial momentum diluted by internal wrangling. It could be doubted whether Cope will regain the electoral momentum again. Indeed, the nature of this society’s voting patterns could lead to opposition parties having to opt for a “coalition of the opposition” sometime soon.

The ANC, however, enjoys the very strong advantages that come from historical positioning, state patronage of the poorer classes through service provision and welfare payments of various sorts, and the dependency on it of the black middle classes through its policies of BEE and related interventions in the private sector. But all of this means that opposition to the ANC, not being accommodated in the normal opposition parties through their supporter make-up, can become factious and sometimes violent, as seen in around 500 separate incidents of “service delivery protest” in 2008 alone.

1.3. Groupings of dialogue
A unique feature of the South African political scene is that a very high proportion of personal income tax is collected from people who do not support the political party in power, and that they have no realistic hope of seeing the parties that they do support coming to power. This uncomfortable fact has enormous and uniquely South African consequences for ordinary political discourse as different centres of power and interest are working in somewhat removed spaces from one another. Nonetheless, it should be noted that this distribution of the taxpayer base is changing; that South Africa’s across-the-board ability to collect both direct and indirect taxes points to a high legitimacy of the State; and that upper quintile taxpayers form a group of increasing fluidity.

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Tshikululu Social Investments is South Africa’s leading social investment manager, providing a one-stop service for private sector entities to undertake comprehensive community grantmaking. For additional information on this work, please refer to Comment on this report by writing to

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