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Kwa-Zulu Natal
The Community Investment Programme: early childhood, community and local economic development

Dr. Norman Reynolds


June 2005

ACAT, AFRA, Diakonia, KZNCC, Practical Ministries, Thukela Mzinyathi Christian Council, Place of Restoration

Made available with permission from Dr. Norman Reynolds
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True generosity consists precisely in fighting to destroy the causes that nourish false charity. False charity constrains the fearful and subdued, the "rejects of life," to extend their trembling hands. True generosity lies in striving so that these hands - whether of individuals or entire peoples - need be extended less and less in supplication, so that more and more they become human hands which work, and, working, transform the world.
From "Pedagogy of the Oppressed", Paulo Freire

Executive Summary

The Community Investment Programme (CIP) represents a move beyond 'delivery' to the use of community as the active partner of the state in the realisation of enabled and responsible citizens realising economic and social rights. Appendix 5 provides a pictorial history of the last 150 years of increasing rural and township marginalisation.

It operates to raise the local income multiplier some 300% in the old 'black' rural and township areas that remain highly marginalised and dependent upon the 'global' South Africa for goods, services and jobs. It is thus a 'Charter for the Second Economy'. This is the quickest way to bring the poor, at least half the population, in from the cold where they are effectively economic prisoners of non-working local economies. This corrective to the main structural fault line of the economic legacy of apartheid, and which forms the dual economy of South Africa, promises to unlock the potential of all areas of South Africa. It provides a highly efficient and effective method to realise the incorporation of all into economic activity and to reward state expenditure with high multipliers and thus high returns via taxation to state expenditure.

The establishment of an economic democracy, that is 'competent' citizens daily exercising the key economic and social rights, is the central task of the second decade of political democracy in South Africa.

The main 'rights' the CIP promotes are reforms around Child Rights, the provision of Investment Rights, and the realisation of the 1997 cabinet promise that by 2020 all South Africans will enjoy the 'Right To Live In A Working Local Economy'.1

Considerable synergy is possible between the various parts of the CIP so that poor local areas could be transformed in a few short years into active local economies. For instance, Soweto, is planned to become a 'suburb' of Johannesburg by 2030, (i.e. a population of 1.5 million without local work and still highly dependent on other places for work, goods and services). Soweto, rather, under the CIP, could become a working city that provided for all its residents within five to ten years.

The CIP works with citizens in community to build powerful local ownership institutions that represent the renewal of traditions of common ownership and joint working under the most modern of corporate forms. Village and neighbourhood become democratic property companies, albeit registered as co-operatives or Trusts, able to hold, receive, invest in and manage productive assets. Women become equal owners, the most progressive advance possible for them and their children. This formulation allows the poor to invest their considerable unused labour to build and to manage valuable assets that reward them with annual dividends. It is thus a vital extension of the formal sector concern with 'broad-based' BEE into the presently informal and dysfunctional parts of society.

The result is an agrarian and land reform programme driven by member communities able, as organised, registered and financed bodies, to enter the land market as they wish. This removes the state from the politics of direct intervention in the land market by establishing an enabling partnership with the poor.

The CIP provides a set of programme rights on offer to member communities through a Co-operative service body. That body has been 'founded' by civil society agencies in KZN. The body is actively seeking to include government and business as fellow members. Community members will soon dominate and come to enjoy an increasing voice until they dominate a 'reformed' partnership with the state and other parties.

The current development practice remains largely top down, state 'delivery' without any real partnership with community although the aims of local government point that way. The style of government, NGO and donor is to supply objects and services into poor areas when their economic marginalisation means that there is no or little effective local demand with which to buy new local production or to pay for new services. There is little attempt to understand and to act upon the structural obstacles to local success. Consequently, South Africa remains a society with very little 'learning' from the near constant failure of local development projects that attempt to work with, whilst ignoring, still dysfunctional communities struggling within non-working local economies.

The main official response to project failure has been to plug the income gap of the poor with a great increase in social grants. These suffer the same fate in that they do not set out to correct the gross inefficiency of sending funds to individuals for consumption purposes when that money leaves immediately for the 'global' economy and so generates little local economic development (LED) and hence provides no sustainable improvement in local conditions.

The proposal covers a half year of set up and three years of operations. The budget is modest given the 'reform' task and the rewards of pulling considerable state expenditure into far more efficient patterns.

  1. Rural Development Framework, Ministry of Lands, Pretoria, 1997

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