TOP business leaders are to meet President Jacob Zuma on Tuesday to press their demands for bold steps by the government to improve conditions for business, including changes to labour laws and cutting red tape.
The meeting comes amid a widening consensus that the government's policies are unsuited to the tasks of raising South Africa's growth rate and creating the jobs needed to make meaningful inroads into poverty and unemployment.The government is facing increasingly harsh scrutiny as South Africa battles a mix of high unemployment, rising inflation, fragile business and consumer confidence and labour unrest.
Last week, Reserve Bank governor Gill Marcus gave a speech that leaned hard on the populist and leftist tendencies in government policy. It was her second such warning in recent times.And on Monday, Bank deputy governor Francois Groepe elaborated on Ms Marcus's themes, flagging economic challenges and the need to address them.
The meeting with Mr Zuma at Sefako Makgatho presidential guesthouse is set to cover five areas: education, skills development, the regulatory environment, lifting investment, and the labour relations environment.It will be attended by the main business lobby groups, among them Business Unity South Africa, represented by businessmen Jabu Mabuza and Nomaxabiso Majokweni; Business Leadership SA's Bobby Godsell; and the Black Business Council (BBC), which will be represented by its president, Ndaba Ntsele, and CEO, Xolani Qubeka, among others.
"There will be discussions around the five major issues. The objective for business is how to assist in accelerating the growth of the economy so that it creates jobs," BBC spokesman Sandile Zungu said.The latest unemployment figures out last week show that 4.7-million people are actively looking for work but could not find it in the second quarter, and so job creation will be high on the agenda.
Mr Groepe told a University of South Africa seminar on Monday that South Africa had failed to make sufficient progress in tackling the many constraints it faced, including a shortage of skills, the structure of the labour market, the volatility of the currency, the regulatory burden on small business and the capacity of the public service."Implementing structural reforms (is) never easy. Policy-makers on the one hand need solid evidence and research to justify their actions. On the other hand, they need political will and political nous to get them through," Mr Groepe said.
He echoed Ms Marcus's call in her speech for a relaxation of laws curbing skilled immigrants. He said improving the education system would benefit many."Naturally, a country must improve the quality of its education system, but with the best will in the world, this will take time to feed into the supply of skills. Importing more skilled workers whilst addressing this constraint would appear to be a sensible economic strategy," he said.
Ms Marcus also said last week South Africa's centralised bargaining regime favoured big business over small and medium-sized companies.National Employers Association of South Africa CEO Gerhard Papenfus on Monday made a similar plea for the labour laws to be changed. He said the government would have to make it much more attractive for companies to employ people by opening up collective bargaining processes.
In an interview with Business Day on Monday, Mr Papenfus called for changes to the Labour Relations Act. "If you change section 32 €¦ in order for the minister to be compelled to take into consideration the interests of small business at the collective bargaining council before extending an agreement, the whole ball game will be changed."
The association, which consists of 20,000 employers who hire about 600,000 workers, also wants to see less red tape in order to foster job creation."Government must stop regulating minimum wages (because) that will give the unskilled and uneducated a foot into the door," Mr Papenfus said.
Speaking on inflation, Mr Groepe said that expected higher inflation in the months ahead had been of concern to the Bank as it happened in an environment of weak economic growth and creating a challenge for monetary authorities.The lower economic growth outlook for gross domestic product of 2% this year, coupled with expected higher inflation in the current quarter, prevents the monetary policy committee from further reducing lending rates to boost economic activity.
"If, however, inflation remains sticky and evidence emerges of second-round effects, the Bank would take appropriate measures in keeping with our mandate," the deputy governor said.
The meeting comes amid a widening consensus that the government's policies are unsuited to the tasks of raising South Africa's growth rate and creating the jobs needed to make meaningful inroads into poverty and unemployment.The government is facing increasingly harsh scrutiny as South Africa battles a mix of high unemployment, rising inflation, fragile business and consumer confidence and labour unrest.
Last week, Reserve Bank governor Gill Marcus gave a speech that leaned hard on the populist and leftist tendencies in government policy. It was her second such warning in recent times.And on Monday, Bank deputy governor Francois Groepe elaborated on Ms Marcus's themes, flagging economic challenges and the need to address them.
The meeting with Mr Zuma at Sefako Makgatho presidential guesthouse is set to cover five areas: education, skills development, the regulatory environment, lifting investment, and the labour relations environment.It will be attended by the main business lobby groups, among them Business Unity South Africa, represented by businessmen Jabu Mabuza and Nomaxabiso Majokweni; Business Leadership SA's Bobby Godsell; and the Black Business Council (BBC), which will be represented by its president, Ndaba Ntsele, and CEO, Xolani Qubeka, among others.
"There will be discussions around the five major issues. The objective for business is how to assist in accelerating the growth of the economy so that it creates jobs," BBC spokesman Sandile Zungu said.The latest unemployment figures out last week show that 4.7-million people are actively looking for work but could not find it in the second quarter, and so job creation will be high on the agenda.
Mr Groepe told a University of South Africa seminar on Monday that South Africa had failed to make sufficient progress in tackling the many constraints it faced, including a shortage of skills, the structure of the labour market, the volatility of the currency, the regulatory burden on small business and the capacity of the public service."Implementing structural reforms (is) never easy. Policy-makers on the one hand need solid evidence and research to justify their actions. On the other hand, they need political will and political nous to get them through," Mr Groepe said.
He echoed Ms Marcus's call in her speech for a relaxation of laws curbing skilled immigrants. He said improving the education system would benefit many."Naturally, a country must improve the quality of its education system, but with the best will in the world, this will take time to feed into the supply of skills. Importing more skilled workers whilst addressing this constraint would appear to be a sensible economic strategy," he said.
Ms Marcus also said last week South Africa's centralised bargaining regime favoured big business over small and medium-sized companies.National Employers Association of South Africa CEO Gerhard Papenfus on Monday made a similar plea for the labour laws to be changed. He said the government would have to make it much more attractive for companies to employ people by opening up collective bargaining processes.
In an interview with Business Day on Monday, Mr Papenfus called for changes to the Labour Relations Act. "If you change section 32 €¦ in order for the minister to be compelled to take into consideration the interests of small business at the collective bargaining council before extending an agreement, the whole ball game will be changed."
The association, which consists of 20,000 employers who hire about 600,000 workers, also wants to see less red tape in order to foster job creation."Government must stop regulating minimum wages (because) that will give the unskilled and uneducated a foot into the door," Mr Papenfus said.
Speaking on inflation, Mr Groepe said that expected higher inflation in the months ahead had been of concern to the Bank as it happened in an environment of weak economic growth and creating a challenge for monetary authorities.The lower economic growth outlook for gross domestic product of 2% this year, coupled with expected higher inflation in the current quarter, prevents the monetary policy committee from further reducing lending rates to boost economic activity.
"If, however, inflation remains sticky and evidence emerges of second-round effects, the Bank would take appropriate measures in keeping with our mandate," the deputy governor said.