Address by President Cyril Ramaphosa on the Presidency Budget Vote 2022, National Assembly, Parliament

9 June 2022

Speaker of the National Assembly,
Deputy President David Mabuza,
Ministers and Deputy Ministers,
Honourable Members,
Fellow South Africans,

Our overriding priority, as this administration and as this Parliament, is to improve the lives of every South African man, woman, and child.

The people of South Africa must come first in all that we do.

The greatest disservice we can do to our people at this difficult time in the life of our nation is to become distracted from the task at hand.

The challenges we face as a country are many.

We are still in the grip of a devastating pandemic that has caused over 100,000 reported deaths in our country.

Poverty, unemployment and under-development cast a heavy cloud, and are preventing millions of people from leading lives of dignity.

In recent times, the rising cost of fuel, food and utilities like water and electricity has made it increasingly difficult for people to get by, to pay their bills and to feed their families.

We continue to count the cost of last July’s unrest in parts of the country and the human and economic impact of recent floods in KwaZulu-Natal, Eastern Cape and North West.

These are the issues that we are seized with as government because they are the bread-and-butter issues that have always mattered the most to our people.

As the great revolutionary Amilcar Cabral once reminded the liberation movements of post-independent Africa:

“The people are not fighting for ideas, for the things in anyone’s head. They are fighting to win material benefits, to live better and in peace, to see their lives go forward, and to guarantee the future of their children.”

What the South African people want above all else is to see their quality of life improved.

They do not care for political squabbles, rivalries, plots, and intrigue.

They want better basic services.

They want jobs and opportunities to better themselves.

They want to live, study and work in environments free of crime and violence.

Amidst our challenges, there is cause for optimism as our economy is beginning to show positive signs of recovery.

I present this Presidency Budget Vote in the week that StatsSA announced that in the first quarter of 2022 the South African economy grew by 1.9 per cent.

The growth we have experienced in recent quarters has brought the economy to pre-pandemic levels much sooner than analysts expected.

Indeed, real GDP is slightly higher than what it was before the pandemic.

This recovery is consistent across most of the major sectors of the economy, such as manufacturing, trade, utilities, finance, personal services, mining, and agriculture.

Our trade figures show further evidence of economic recovery.

In 2021, we posted the largest trade surplus on record at R448 billion, the highest since 1987.

Last week, the latest Quarterly Labour Force Survey was released, showing that the number of unemployed people in the country dropped in the first three months of 2022.

This translates to 370,000 jobs created between the last quarter of 2021 and the first quarter of this year.

I also present this Budget Vote in the year that the 4th South Africa Investment Conference raised investment pledges to the value of R332 billion.

This brings us within reach of the target we set in 2018 of attracting R1.2 trillion in investment over five years.

The outcome of the Conference shows renewed business and investor confidence in our economy and in our reform process.

In recent weeks, there has also been encouraging progress by law enforcement authorities in pursuing cases from the state capture era.

These are the green shoots of recovery and of progress.

These are the signs that we are on the right track.

They give us hope and confidence to forge ahead.

Honourable Members,

Since the sixth administration took office in 2019, we have been seized with restoring state capacity, and with forging whole-of-society partnerships with business, labour and civil society on the actions that are needed to rebuild our economy.

Building a capable state and restoring integrity and professionalism to the public service has been our foremost priority. What we have sought to do over the past four years is to locate the Presidency at the centre of an integrated government.

From this centre, we have been leading the drive to reconstruct the nation’s economy in a manner that is inclusive, and that leaves no-one behind.

In this year’s State of the Nation Address, I outlined our key priorities for the year ahead.

These priorities are to grow the economy and create jobs, fight corruption, make communities safer, build better lives for all our people, and make government work for the people of our country.

We have been doing all of this while working to ensure a swift recovery from the COVID-19 pandemic and mitigating the impact of the recent floods.

At the heart of our growth strategy is a bold and far-reaching economic reform agenda.

These reforms are being driven by the relevant departments and agencies and supported by Operation Vulindlela, which is an initiative of the Presidency and National Treasury.

These reforms aim to achieve an affordable and reliable supply of electricity and efficient freight transport.

They aim to achieve long-term water security, cheaper mobile data for all South Africans and a visa regime that facilitates tourism and investment.

We are firmly on track to implement the reforms outlined in the State of the Nation Address.

In March, the long-awaited spectrum auction was completed to expand access to the internet and reduce the cost of data, for the first time in more than a decade.

This was a difficult and complex process. We are grateful to all those who made this possible.

In April, Bid Window 6 of the renewable energy procurement programme was opened for 2,600 MW of solar and wind power.

The first three risk mitigation projects have signed their power purchase agreements.

These projects represent some of the largest hybrid solar and battery storage projects in the world.

The Electricity Regulation Amendment Bill that provides for the establishment of a separate transmission company and a competitive market for electricity has been published for public comment, and we are now working to table the final version in Parliament in the coming months.

In April, Transnet made 16 slots on its network available to private rail operators as the first step towards ensuring third party access to some of the country’s freight lines. This will enable greater efficiency and support our export industries.

The Department of Water and Sanitation is hard at work to clear the backlog of water use license applications by June 2022.

To date it has finalised 897 applications and will clear the remaining backlog of 546 applications by the end of this month.

We are on the cusp of a fundamental transformation in the electricity sector, which is undergoing the most significant reform process in our country’s history.

Once these changes are implemented, we will have multiple generators competing to supply electricity at the lowest cost and selling power directly to customers.

We will unleash new public and private sector investment in generation capacity at a massive scale.

In the short term, however, we are seized with the need to get as much new generation capacity onto the grid as possible, as quickly as possible.

The current electricity shortfall is estimated at up to 6,000 MW.

We will soon be introducing extra measures to bring new capacity online.

We will work to close the electricity gap in six ways:

Firstly, improve the performance of existing power stations and ensure that additional units at Medupi and Kusile come online according to schedule.

Secondly, ensure that projects from existing procurement programmes, including Bid Window 5, are able to reach close and connect to the grid as quickly as possible.

Thirdly, accelerate private sector investment in generation capacity under 100 MW.

Fourthly, enable Eskom to purchase surplus power from existing power producers.

Fifthly, support municipalities to procure power independently.

Sixthly, encourage households and businesses to invest in small-scale solar power installations and feed energy to the grid.

Work is already underway in each of these areas.

There is coordination with all relevant departments, Eskom and the private sector to accelerate embedded generation projects.

We have already simplified the registration process by removing the requirement of a power purchase agreement for registration, shortened the timeframes for environmental authorisation, and increased Eskom’s capacity to process grid connection applications.

The first two embedded generation projects under 100MW were successfully registered two weeks ago, and a further 16 projects were registered by the regulator this week.

A total of 68 projects are now in development, with a combined capacity of over 5,000 MW that will begin to connect to the grid over the next few months.

Alongside these immediate interventions, the Department of Mineral Resources and Energy will drive the process of reviewing and updating the Integrated Resource Plan 2019 to ensure that it remains relevant in light of the electricity shortfall and our climate change commitments.

Honourable Members,

When the sixth administration commenced its work, we said that forging social compacts across society would be critical to addressing our developmental challenges.

Unless we consistently strive to achieve broad consensus on the direction in which we want to take the country, we run the risk of our efforts being stalled.

Since 2018 the Presidency has established a number of processes to forge consensus on the broader economic recovery, the 4th Industrial Revolution, the reform of our state-owned enterprises, climate change and corruption.

We also sought to engage at the Presidency level with traditional leaders to address their specific challenges, including the issue of land.

The Deputy President, who has led this process, will report further on this work.

The Deputy President has also been delegated to deal with the long-standing challenges that former liberation combatants continue to experience.

Bringing together key stakeholders with varying ranges of expertise ultimately enhances the capacity of the state.

This continues to aid the policymaking process. It ensures that all of society is involved in our country’s development.

An example of how this is being done effectively is through the Presidential Climate Commission, which is currently finalising a Just Transition Framework that will guide our transition to a low-carbon, inclusive, climate resilient economy and society.

In tandem, the Presidential Climate Finance Task Team I established earlier this year is working on the modalities of an agreement that will take forward the Just Energy Transition Partnership concluded between South Africa and the governments of France, Germany, the United Kingdom, the US, and the European Union last year.

This partnership will mobilise climate finance to enable our transition to a low carbon economy while supporting affected workers and communities.

Our focus will be on supporting a just transition in the electricity and automotive sectors as well as the development of our green hydrogen sector.

The work of the Presidential SOE Council is also far advanced.

The Council has developed criteria to determine which SOEs should be considered strategic and are critical for future development,

It has already assessed 17 SOEs and will complete the remaining assessments in July this year.

The broader context of the reform process is to improve the overall business operating environment and to improve our country’s competitiveness as an investment destination.

To this end, we have finalised the bounce-back loan scheme, which gives additional funding to businesses to grow the economy and create jobs.

In March, the employee tax incentive was expanded to make it easier for employers to hire more young people.

As part of our drive to create a new generation of black industrialists, create jobs and transform the economy, last year government approved R2.5 billion in new support to about 180 black industrialists in the form of loans and grants.

Over the next three years a further R21 billion has been committed to support black industrialists and an additional R25 billion to support black, women, youth and worker-owned companies.

Policy certainty in the mining sector has been bolstered by the publication of the long-awaited Mining Exploration Strategy.

The Infrastructure Office continues with its work of oversight and coordination over a number of catalytic infrastructure projects.

These include the Welisizwe Rural Bridges Programme, the rural roads programme, social infrastructure, bulk water, and others.

To address onerous bureaucracy that impedes business growth, the Red Tape Reduction team is working with other departments to identify priority interventions and remove obstacles to growth.

These initiatives take a collaborative and supportive approach, because ultimately it is departments and not the Presidency that implement policy.

Honourable Members,

One of the tasks of government is to devise innovative solutions to address joblessness, particularly in a climate where there is a shortage of employment opportunities at a time when the private sector is not creating enough jobs at scale.

During the past two years, we have overseen an expansion of public employment that is unprecedented in speed, scale, and innovation.

The Presidential Employment Stimulus has enabled the rapid expansion of public employment and provided much-needed relief to mitigate the effects of the pandemic.

To date, the Presidential Employment Stimulus has created 879,000 opportunities.

Of the participants across both phases, 84 per cent are youth and 62 per cent are women.

These programmes, which range from waste collection to small-scale farming, have provided work and an income for hundreds of thousands of people in both urban and rural areas.

The programme has provided livelihood support for people working in the arts and culture sector as part of our commitment to support the recovery of this vital sector of our economy and our society.

In a great boost for food security and agricultural reform, around 65,000 small-scale farmers have received input vouchers to buy seeds, fertiliser and equipment.

The latest programme to be launched through the employment stimulus is the Social Employment Fund, which has started to recruit 50,000 participants in community safety, food and nutrition, digital inclusion, and sports, arts, and recreation.

A further 50,000 participants will be recruited for the revitalised National Youth Service, of which more than 7,000 have already started work.

Though much has been done, it is clear we need to do more.

With the Special COVID-19 Social Relief of Distress Grant extended until the end of March 2023, as government we continue to explore what sustainable social protection measures can be implemented to support society’s most vulnerable.

We are working in earnest to conclude our negotiations on a social compact, as stated during the State of the Nation Address.

The discussions we are having with social partners are dealing with difficult issues that have wide-ranging implications for our economy.

We are hoping to build a new consensus that pairs economic reform with measures to support employment and expand social protection.

We are determined that the social compact should be substantial and meaningful that makes a real and lasting difference to the trajectory of our economy.

Honourable Members,

Our experience with the COVID-19 pandemic has shown how much more can be achieved when all of society works together to achieve a common goal.

Thanks to this collaborative effort we were able to mitigate the pandemic’s worst effects on human health and livelihoods.

To date, approximately half of all adult South Africans have received at least one COVID-19 vaccine dose, and our priority is to increase the rate of vaccination to protect our people against possible new waves in the future.

I once again encourage people to vaccinate against COVID-19, to wear masks and to follow all the preventative measures.

Over the past three years, we have been at the forefront of advocacy for developing countries to manufacture their own vaccines in the interests of current and future health security.

As we know, South Africa alongside India has co-sponsored a proposal to the World Trade Organization for a temporary waiver of the TRIPS agreement.

We are using our position as African Union COVID-19 Champion to encourage developed countries and international agencies who procure vaccines to purchase from African manufacturers.

South Africa has been hard at work within the AU structures to advance the cause of greater pandemic preparedness for Africa.

This includes strengthening public health institutions, expanding manufacturing of medical countermeasures on the continent, establishing a fit-for-purpose health workforce that can sustain universal health coverage, and driving collaborative partnerships.

Even as we focus on recovery from the pandemic, the Presidency continues to work with the Department of Health and other departments towards strengthening our health systems in preparation for the National Health Insurance.

As a nation, we are making progress in moving this transformative legislation to reduce inequality in access to quality health care.

Honourable Members,

As we strive to build a capable, ethical and developmental state there is no room for corruption.

We will continue to support the work of the Investigating Directorate of the National Prosecuting Authority, the Special Investigating Unit and its Special Tribunal, the Fusion Centre and all state entities involved in the fight against corruption.

The SIU is achieving a great deal of success in its applications to the SIU Tribunal for the cancellation of contracts and the return of funds.

We will be ensuring that the recommendations contained in all SIU reports are systematically processed and sent on to the respective entities to which findings have been made and urging that they are acted upon, and stolen funds recovered.

The Minister in the Presidency has been reporting on this work to this House.

We will furthermore speedily consider all requests for the issuing of proclamations, and appointments to the Tribunal where necessary.

As we have said before, the Presidency will deliver to Parliament an implementation plan on the recommendations of the Commission of Inquiry into Allegations of State Capture four months after receipt of the final report.

Work has begun on the large number of recommendations made in the parts of the report received to date.

We will only have the full measure of the work required when we receive the final report from the Chief Justice.

Taking these recommendations forward requires the highest political will and commitment from us all, the Members of this House included.

It also requires great courage, from us all.

In recent days we have seen those who stand to lose the most from the fight against corruption resorting to dirty tricks and intimidation in a bid to get us to back down.

The serious threat levelled against the Director-General in the Presidency is deplorable and we condemn it in the strongest terms.

It is a sign of the lengths to which these criminals will go. But we will not be deterred by threats of any kind.

They will pay for their actions.

We will restore the values of integrity and credibility to our government.

We will take back our country from criminals.

At the same time, we are giving equal attention to safety and security in our communities.

I want to commend the leader of the United Democratic Movement, General Bantu Holomisa, for initiating the recent meeting between the Presidency and political parties represented in Parliament to discuss safety and security issues in the country.

It was a proactive engagement where we discussed the challenges and possible solutions.

It is our expectation that, as Parliament, you will continue in this collaborative vein when we soon reflect on the draft National Security Strategy.

Progress has been made in building capacity within the law enforcement agencies.

The appointment of a new Commissioner of Police has brought much needed stability to the organisation.

The first cohort of 12,000 new police personnel is in training, and a framework has been developed by the SAPS for the nationwide re-establishment of community policing forums.

The SAPS has established multi-disciplinary units to address crimes of economic sabotage and extortion at construction sites by so-called business forums.

Partnerships between government and the private sector to address organised crime are also bearing fruit.

For example, the collaboration between Transnet and the Minerals Council around illegal mining and copper theft has seen an improvement in the security situation at a number of sites.

A stronger, better capacitated South African Police Service is key to combating crimes of violence against women and children that continue in our country.

In January this year, I signed into law three bills that will strengthen the fight against gender-based violence and afford greater protection for survivors.

Their implementation is scheduled for the 31st of July 2022 once the amended regulations are tabled in Parliament.

The Presidency continues to receive regular reports from the Department of Women, Youth and Persons with Disabilities as well as other departments on their progress in implementing the National Strategic Plan to end Gender-based Violence and Femicide.

Putting stringent laws in place and enhancing the capacity of the police and prosecutorial service to investigate and prosecute these crimes is not enough, and we need all of society’s involvement in prevention efforts.

Community based organisations are agents of change and play an important role in the effort to eradicate GBV and other social ills.

This includes the development and implementation of programmes around GBV, substance abuse, teenage pregnancy, mental health, LGBTQI+ advocacy and other issues.

We will soon be convening a Social Sector Summit, together with the Department of Social Development and NEDLAC, to look at ways of harnessing the important work of the social sector to propel our nation’s development.

Through the Presidential Working Group on Disability, we will also continue to advance interventions that promote inclusion for persons living with disabilities across all sectors of society.

The approval by Cabinet of the Constitutional Eighteenth Amendment Bill for public comment takes us one step further to making sign language South Africa’s 12th official language.

This is a historic development that will give effect to our Constitution’s promise of equality and human dignity for all.

Honourable Members,

Next month marks a year since terrible unrest and violence rocked parts of our country and wiped approximately R50 billion off our nation’s economy.

As the Presidency we are working with the respective departments to coordinate the implementation of the recommendations of the Expert Panel chaired by Professor Sandy Africa.

A new Director General was appointed to the State Security Agency earlier this year, and a number of critical vacancies have been filled, or are in the process of being filled, in the SSA, Crime Intelligence and the SAPS.

Four thousand members have been earmarked to build capacity in the Public Order Policing Unit once they have undergone basic training, and for the financial year 2022/2023 a further 5,000 trainees will be recruited.

The National Security Council is receiving periodic reports from the relevant law-enforcement entities on progress in implementing the recommendations.

We will be reporting to the nation in due course on this process.

Honourable Members,

As part of realising a capable state, we are on a drive to rebuild the public service through promoting lifelong learning, improving skills, and providing the necessary orientation to entrants to the public service.

This is happening across government departments, in every municipality, state-owned enterprise and every organ of our state.

We are working to ensure that the Batho Pele Revitalisation Strategy is fully implemented.

We have established a Public Administration Ethics, Integrity, and Disciplinary Technical Assistance Unit to improve ethical and anti-corruption policy and discipline management.

Public servants are being trained on ethical conduct through the National School of Government in partnership with the Financial Sector Conduct Authority.

The National School of Government is rolling out a range of courses for the executive, accounting officers, senior managers, mayors, state entity board members and others on a range of disciplines from economic governance to long-term planning.

In the State of the Nation Address, I said we would finalise the National Framework towards the Implementation of Professionalisation of the Public Sector.

The revised Framework proposes fundamental reforms, including a stronger emphasis on merit-based recruitment and appointments, integrity testing before any individual joins the public sector, revising the tenure of heads of departments, and curriculum development for ongoing learning of public servants.

We expect this framework to be fully implemented across departments and state entities within the next year.

An intrinsic part of government working for the people is making local government more responsive and more efficient.

We began implementing the District Development Model in 2019 to better coordinate and integrate the planning and budgeting of government programmes on a district-based level.

We coordinated much of our response to the pandemic through the district development model, ensuring that crucial health and social support services reach people in the communities where they live.

Most recently, we relied on District Champions to drive vaccination through the Vooma Vaccination weekends.

I announced during the 2022 SONA that I would embark on a programme of District Development Model Izimbizo.

These engagements afford communitioes the opportunity to raise their most pressing concerns and provides an opportunity for government to give direct updates on service delivery.

To date, Presidential Izimbizo have been held in North West, Free State and Mpumalanga and we intend to visit all the provinces in due course.

Whilst we proceed with Izimbizo in the remaining six provinces, government officials will be attending to the concerns identified already, resolving issues and providing feedback to communities.

These engagements have further highlighted the extent of the weaknesses at local government, and the impact that this has on the provision of basic services.

As national government, guided by our Constitutional responsibilities and powers, we will continue to support municipalities to meet their obligations to the residents and businesses they serve.

In particular, we will marshal all the resources and capabilities of government departments and entities to intervene in areas such as water provision, road maintenance and waste management.

We will work with provincial and local government to ensure that potholes are fixed, water is clean and reliable, and that cities and towns are clean and healthy to live in.

Honourable members,

Fellow South Africans,

When this administration took office three years ago, we embarked on a path of renewal to restore the promise of our democracy.

And we have come a long way.

The economic recovery is gathering momentum, and the GDP growth figures speak for themselves, as does the steady uptake of domestic and foreign investment.

The state is being steadily rebuilt and credibility is being restored.

The fight against corruption continues apace, and the net is closing in on those who for years grew fat off the money and resources meant for the benefit of the South African people.

It is they who fear the renewal agenda most. And they will do anything to divert the focus off themselves.

But we will not waver. We will not blink. We will finish what has been started.

And as we do so, we will not be side-tracked from our one objective: to improve the lives of the people of South Africa.

The positive impact of the programmes and policies of this administration is being felt where it matters most.

It is being felt in our classrooms, where education assistants are supporting teachers to perform their work, and also getting training in IT skills, reading and literacy, coding and childcare.

It is being felt in the agricultural sector where thousands of small-scale farmers are looking forward to a good harvest this year, thanks to the support of the Presidential Employment Stimulus, which has enabled them to revive land for food production and to farm livestock.

The positive impact is being felt in our cities, towns, and villages where participants in the Presidential Employment Stimulus are greening public spaces, collecting and recycling waste, clearing alien invasive vegetation, and conducting environmental education programmes.

It is being felt in the tourism sector where monitors, many of them young people, are helping keep our foreign and domestic tourists safe at key sites, and SMMEs in the provinces are receiving support to promote local tourist attractions.

We are a government hard at work to grow our economy and create jobs. And our hard work is bearing fruit.

The Presidency will continue to lead the work towards the vision of a better life for all, and an economic reconstruction and recovery that leaves no-one behind.

I hereby commend this Budget Vote of the Presidency to the National Assembly.

I thank you.

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