It comes up every so often, repeated like a national liturgy: South Africa has good policies, but poor implementation.

The latest high-profile personality to make this claim is the respected former Statistician General, Dr Pali Lehohla, who put it thus: ‘The policies of the ANC are good on paper but have not changed the material conditions of ordinary South Africans.’

In this he is going somewhat further than a restatement of the disconnection between policy ideas and their implementation; he is making a variant of the claim made often by the extreme fringes of our politics (and some not-so-extreme) that the post-apartheid order has failed. So, this claim goes, things are no better for most people now than they were in 1994, or even in the 1980s.

This may not be Dr Lehohla’s intended meaning, but his choice of words certainly lends itself to that interpretation. But in any event, he is incorrect.

The ANC’s policies since the 1990s have been a mixed bag. Many of its initiatives have had a real and beneficial impact on the lives of ordinary people.

In 2013, the Institute of Race Relations ran a short social media campaign #IRRKnowYourANC aimed at highlighting this. There were indeed matters to celebrate: expanded access to water and electricity, for example, housing construction and increased access to higher education. It was greeted with some indignation, but the facts on this spoke for themselves. Reality is not political.

Frans Cronje, then the Institute’s Deputy CEO, explained: ‘If South Africans don’t know what is happening in their country, how can they possibly make decisions about who should lead the country? Lack of informed decision-making is a great threat to our democracy.’

Possibly most importantly, the roll-out of social grants has provided a lifeline to millions of the country’s people. Last month, officials from the Department of Social Development told Parliament that some 47% of South Africa’s people depend on grants – this includes those receiving the special Covid grant.

This is no small matter.

However, none of this is to suggest that South Africa is doing well. Quite the contrary, growth has trailed that of other emerging markets for over a decade, and hardly a day goes by without some revelation of another new or familiar governance failing.

The upshot of all this can be summed up in the failure to put South Africa onto a high-investment, high-growth, employment-generating trajectory. Here, it is not implementation – however shoddy it may have been – but the ANC’s own policies that must take the weight of responsibility.

It is not original to say that a policy is inherently only as good as its implementation; a policy that cannot reasonably be implemented is by definition a bad one.

‘No such thing’

Nazmeera Moola wrote in the Financial Mail in 2011: ‘Many years ago a couple who had become legislative drafters asked me about South Africa’s rape laws. I said we had good laws but poor implementation. They countered that there is no such thing: before a law is written it must take into account the capacity of the system to implement it. If the system cannot carry it out, the law is by definition a “bad law”.’

The ruling party has been talking about building a mighty developmental state in South Africa – at times even using the term to describe the country – which is delusional in view of its actual capacity.

Much of this can be attributed to the prioritisation of political affiliation, and demographic representivity has been a major stumbling block to achieving the country’s aspirations – both in terms of what the state delivers, and in terms of the environment it creates for the private sector.

Yet the toxic, counter-constitutional practice of cadre deployment remains a party commitment. Even President Ramaphosa defended it before the Zondo Commission.

So, policies assuming a capacitated state are a tough ask.

But even if the state had the capacity to implement its policies flawlessly, many of these are simply bad and counter-productive. SBP (formerly the Small Business Project) – an analyst organisation – has remarked: ‘South Africa is in the paradoxical position of being both overregulated and undergoverned.’

SBP has catalogued just how inhospitable the business environment is, not just because of structural factors in the broader economy, but because hurdles have actively been erected.

In a field study conducted in 2005 – admittedly, close to two decades ago – it estimated that small firms were on average having to spend some 4% of their turnovers on dealing with red tape. Its subsequent research reiterated this theme. The excellent SME Growth Index, which it first produced in 2011 and continued for a number of years, showed the extent to which compliance costs were consuming the energies and resources of small businesses. Reducing this burden would need to be a priority if the small business economy was to flourish.

Indeed, a 2014 SBP paper on regulation made the following comment:

The average small business owner doesn’t have the resources to hire experts that ensure they are meeting an increasingly long list of compliance requirements, and many are not even aware of regulations that would have direct impact on their ability to do business. The government looks to the SME to support the country’s growth and employment targets but offers little efficacy when it comes to providing guidance and support in return. The United Kingdom for example, cites 6 simple steps on its official website that a business has to follow in employing a person for the first time. South Africa’s official website in comparison, lists more than three pages of the steps necessary to hire an employee – a veritable labyrinth – and these relate only to compliance with the country’s labour laws.

And despite occasional recognition of this problem from the government, little has been done to address it.

Greatest concerns

Just last year, another survey of 300 firms – the Mastercard SME Index – found that close to two thirds (62%) cited ‘red tape and regulations’ as one of their greatest concerns in the year ahead.

A special mention needs to be made of Broad-Based Black Economic Empowerment. It is by its nature a tax on business and a vehicle for the politically connected. It has offered nothing to ordinary people who struggle to find a place in the economy – nor indeed for most black entrepreneurs who are attempting to survive and grow in the market. SBP’s research, incidentally, found little benefit to it.

The proposed introduction of a policy of Expropriation without Compensation meanwhile has done great damage to investor sentiment, domestic and foreign. This was conceded by government’s investment envoys. The ANC and government invested an enormous amount of political capital in this, only to chase actual capital away.

And in the current circumstances, the notion of giving the state access to pensions, saving and medical funds will be less likely to fund and drive development than to create a new well of patronage, passing the consequences on to South Africa’s long-suffering people.

Implementation is a real problem. But none of South Africa’s maladies – administrative chaos, widespread corruption, anaemic investment, stratospheric unemployment – will likely be remedied until there are real policy changes both within the ANC as the ruling party and in the state.


If you like what you have just read, support the Daily Friend

Terence Corrigan is the Project Manager at the Institute, where he specialises in work on property rights, as well as land and mining policy. A native of KwaZulu-Natal, he is a graduate of the University of KwaZulu-Natal (Pietermaritzburg). He has held various positions at the IRR, South African Institute of International Affairs, SBP (formerly the Small Business Project) and the Gauteng Legislature – as well as having taught English in Taiwan. He is a regular commentator in the South African media and his interests include African governance, land and agrarian issues, political culture and political thought, corporate governance, enterprise and business policy.