Despite negative perceptions, South Africa has some of the finest public institutions – the revenue service, the reserve bank, airports company, to name a few. These institutions are crucial to the functioning of the country and are often undervalued in terms of their national importance.
Last year, for example, the Airports Company of South Africa (Acsa) registered growth in its revenue and asset base – it reported a profit of R1.9bn, with revenue increasing 6.8% to R8.3bn. This was attributed to the introduction of new routes, growing passenger numbers from Europe and Asia, among others.
It also recently unveiled its new R2.5-million passenger link that is meant to ease congestion at the main security and immigration checkpoints for international flights at OR Tambo International.
Its relationship with South African Revenue Service (SARS), and police have also been crucial in intercepting drug mules and confiscating cargo loads of fake goods.
SARS continues to be an unheralded success story in post-apartheid South Africa, many a time receiving only begrudging praise when it should be heralded as a government institution that continues to function and function well.
The numbers speak for themselves, but it is perhaps useful to remind ourselves that SARS plays a vital role in nation building, quite literally.
It continues to build the taxpayer base year-on-year and this enables it to continue to build on key infrastructure projects or other interventions it has had a hand in seeing to successful conclusions.
SARS is also crucial in the government’s National Development Plan (NDP) goals towards achieving equitable outcomes for society as a whole when it comes to issues of homes, education, healthcare and other aspects of a new social contract geared towards transformative change.
In 1994 there were a mere 1.7 million registered taxpayers, but through placing the right people in the right positions and by streamlining the tax gathering processes, the number of taxpayers increased to 19.1 million in March last year.
Tax revenue collected in the 2015/2016 financial year totaled R1 070 billion.
As Michael Katz, chairman of ENSafrica and honorary professor at the University of the Witwatersrand, pointed out a few years back, “SARS remains an example of excellence, cited across the world and its consistent high performance has enabled the ramp-up of expenditure on electrification, housing, sanitation, infrastructure, and social services over the past 20 years. The defining characteristic of the transformed SARS is competence. As South Africa embarks on the next chapter of its democratic journey, I believe we must consider carefully what it will take for other state institutions to achieve levels of competence on a par with that of SARS. This is because, as the experience of many countries shows, there is a powerful correlation between a competent state and good economic and social outcomes.”
In the case of South Africa, the importance of a competent state is all the greater given our historically high levels of poverty and inequality. In 1994, poverty was widespread and the disparities between the wealthy and the poor ranked amongst the greatest in the world. As stated in the report of the Tax Commission, “the legacy of poverty and inequality constitutes a moral issue of the gravest dimension… Unless these problems are urgently addressed, the prognosis for South Africa is bleak. Today, despite considerable progress in areas including housing, electrification, and social welfare, high levels of poverty persist. By the most recent measure, one in two South Africans remains below the national poverty line, while the Gini coefficient, which measures inequality, has actually increased — from 0.66 in 1993 to 0.69 in 2013.”
The SARS example is an important litmus test for how far the country has come, but as Katz points out, we as a government have many challenges, but its approach is underpinned by the fundamental values of equality and transformation which are vital if we are to succeed as a nation.
Growing the economy since the 2008 worldwide economic crunch, the credit downgrading by ratings agencies, high unemployment figures have all conspired to put a squeeze on the economy and on people’s wallets.
But South Africa has, on the back of the agriculture sector, emerged from a technical recession with figures showing the economy grew by 2.5 percent by June.
The SA Reserve Bank should take some credit for the uptick in the economy – it cut its repo rate by 25 basis points to 6.75% in July for the first time in five years. There has been a re-emergence of the notion that the Reserve bank should be state owned, this is in line with what appears to be our macroeconomic posture that seems to be priming the state to be a more aggressive economic player in ensuring that we have sustainable and meaningful economic growth. There has been much criticism around part of the bank’s monetary policy, specifically inflation targeting, this criticism has been used to some extent to affirm and bolster the call to move the central bank back to state ownership. Albeit, in light of many of the glaring challenges we still face in these institutions we still have a good story to tell about these institutions.
A sign that it was supporting the economy and that it is the spearhead of our economic recovery. These public institutions cannot and will not be allowed to stagnate. They are clear in their mandate which is in the service of the South African people. Its track record not only suggests that, but has proven that it will continue to be beacons of excellence and delivery which every citizen should rightly be proud of.
Mbasa Satyi is a NEC member of the ANCYL