South Africa’s crisis response plan

6 August 2009

South Africa’s goverment is to take a number of steps to see the country through the global economic crisis. These include a R2.4-billion worker layoff training scheme, R6-billion in support for struggling firms, measures to root out customs fraud, and debt restructuring help for consumers.

President Jacob Zuma outlined the measures on Wednesday following a meeting in Pretoria, where he was briefed on the recommendations of a crisis response task team made up of government, business and labour representatives.

National Jobs Fund

One of the task team’s recommendations was a worker layoff training scheme. To be launched in September, the scheme aims to save jobs, and pave the way for new job creation, by subsidising temporary work suspension cum training periods for workers in industries threatened by the downturn.

To fund the scheme, R2.4-billion will be placed in a National Jobs Fund, drawn from resources in South Africa’s National Skills Fund and the Unemployment Insurance Fund.

The jobs fund will pay workers training allowances, pegged at 50% of their basic wage to a maximum of R6 239 a month. It will only apply to workers earning less than R180 000 per annum. The programme will run for three months for any group of employees.

South Africa’s Sectoral Education and Training Authorities (Setas) have also been requested to set aside funds for the training, which will cover skills that would be useful to the relevant company or industry.

Financial support for firms

In addition, the Industrial Development Corporation will make R6-billion available over the next two years by to support affected firms.

“Key areas in respect of distressed sectors have been addressed, including support for distressed companies in the automotive sector, a rescue package for the clothing and textiles industry, and increased incentives for the manufacture of capital equipment, transport equipment and fabricated metal products linked to South Africa’s infrastructure development programme,” the Presidency said in a statement.

The Presidency also reaffirmed the government’s commitment to pay small businesses within 30 days for their services or products.

Addressing customs fraud

The government will also take the necessary steps to strengthen the ability and capacity of the South African Revenue Service (Sars), in order to address customs fraud that has led to many job losses.

“In addition, Sars has reported significant progress in respect of investigations, and the confiscation of goods and prosecution of persons responsible for fraudulent import transactions involving, among others, smuggling, ’round-tripping’ and under-declaration of value,” the Presidency said.

Protecting consumers

As part of the state’s efforts to protect South African consumers, Zuma said that the Competition Commission’s investigations into and prosecution of food companies allegedly involved in price-fixing were far advanced.

“These include investigations or action in respect of bread, milling, dairy, poultry, fats and oils, fertilizers and supermarkets.”

In addition, the National Debt Mediation Association, a business initiative to assist indebted consumers, had been established to provide rules, standards and processes to address debt restructuring.

While significant technical work on South Africa’s rescue measure has been done and important progress made, Zuma called for implementation to be speeded up so that the effect of the work would begin to be felt by South Africans.

“The important thing to remember is that work is being undertaken by all social partners in consultation,” Zuma said. “Not only are these partners part of developing our response to this crisis, they are also each responsible for implementing it.”

SAinfo reporter and BuaNews

Would you like to use this article in your publication or on your website?
See: Using SAinfo material