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Breaking the grip of

Poverty and inequality in South Africa 2004 - 2014: current trends, issues and future policy options

Executive Summary
Co-ordinated by J P Landman

Desember 2003

Electronic copy

Posted with permission of Dr Renier Koegelenberg, Executive Director, EFSA
[Download complete version - 98Kb ~ 1 min (19 pages)]     [ Share with a friend  ]


The single most important issue facing South Africa ten years after the transition to democracy is breaking the grip of poverty on a substantial portion of its citizens. There is a consensus amongst most economic and political analysts that approximately 40% of South Africans are living in poverty - with the poorest 15% in a desperate struggle to survive. This means that approximately 18 million out of 45 million people have not experienced the benefits of our newly found freedom. This poses a moral challenge to all South Africans - to work together towards the economic and social integration of the poorer section of our fellow citizens.

The debate on poverty could be approached from different perspectives and on different levels. The earlier ideological debate between capitalism or socialism, or a possible "Third Way", has subsided since the democratisation process in Eastern Europe gained momentum. Even with regard to the current dominant model of a liberal free market economy in the world, one could follow alternative routes: on the one hand, the fundamental principles of the current macro-economic model could be questioned and rejected as such. On the other hand, even if the reality of the current dominant model is accepted in a more pragmatic approach, critical challenges and questions could be raised with regard to the complexities, the contradictions and side-effects of this model.

This report represents an executive summary of three longer research papers by our task team and several colloquiums where the findings of the research were discussed with independent panellists. The integration of different research fields (demography, macro-economics, labour market and poverty) strives to create a common understanding of the problem and the challenge we face. Although the report is founded on solid and comprehensive academic research, it provides an intelligible analysis of economic trends and some of the complex choices (with far-reaching consequences) that decision-makers have to make: "High growth will certainly help to roll back poverty...but it might exacerbate inequality…which one gets the priority?", or "In the struggle against poverty, the needs will always be more than the available resources". This explains the intensity of the political debate on priorities within state expenditure.

This not only raises the temperature in the public debate with regard to the priorities of the state's budget, but it also challenges all sectors (state, business, churches, NGOs, etc.) on the quality and the efficiency of their social programmes to combat poverty. The task team has underlined the importance of public-private-partnerships to enhance both the efficiency and quality of public spending, but also to combine limited resources from different sectors for a greater focus and social impact.

One of the sobering findings is, that even if we accept a higher growth path as an important instrument to eradicate poverty, a large portion of our citizens would need the support of special programmes to alleviate the worst poverty - to help them to survive.

The report does not give a full analysis of macro-economic models, nor does it give all the answers to the complex challenges we face with regard to poverty. It strives to give an intelligible, reliable and realistic picture on the economic trends over the past years, as well as some of the complexities and tough choices that decision-makers are facing in shaping our future. In this sense we hope that this report could contribute towards a common understanding of the problem.

The report is an important building block in the three discourses that the EFSA Institute is currently facilitating in the public debate on combating poverty:

Firstly, what is the role of the church, as well as other religious communities, in social welfare and developmental programmes? This includes theological reflection on the identity, the calling and the role of the church in society. The prophetic witness of the church on issues of social justice, as being the church for the poor, is part of this discourse.

It also includes empirical research on the capacity, the contribution and effectiveness of intermediary networks that implement programmes. What are the best practice models and how does one measure the impact of these programmes?

Secondly, what is the best model of partnership between religious communities and the different levels of the state? What policy frameworks are necessary to provide equal access to public funds and stability in social services rendered by religious communities? What guidelines and conditions are necessary to ensure consistency and the responsible utilization of public funds, as well as efficiency in the implementation of programmes? How does one protect the identity of religious networks from political co-option, but ensure concrete co-operation? What incentives (e.g. tax deductions) would promote a culture of giving, of solidarity with the poor and the creation of a caring community?

Thirdly, what models of partnership between religious communities and the business sector could enhance the impact and the effectiveness of social programmes? Both sectors have unique networks, capacities and considerable resources available. Would co-ordination and the sharing of resources not enhance the impact and the sustainability of social services?

An important element in all three discourses is the quality of social spending: how does one ensure that limited resources are used in the most efficient and effective way to benefit the large number of poor citizens?

We are grateful for the work of our task team and would welcome critical remarks, comments or contributions on the issues that have been highlighted. Copies of the full report, containing the different research papers, are available.

Renier Koegelenberg

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