• South Africa faces an unemployment crisis of unprecedented proportions. Millions of our people are out of work. Their skills and productive labour go unutilised and they are denied their rightful part in building the new South Africa.

• Unemployment underpins crime and poverty and is a drain upon the resources of the nation. Just as importantly, it traps millions of our people in a cycle of poverty and despair.

• High levels of crime compound the employment crisis by frightening off foreign investors. The IFP’s Anti-Crime Manifesto sets out the tough measures needed to restore investor confidence in our country.

• Job creation is the number one priority of the Inkatha Freedom Party. It must become the number one priority of the government that assumes office after the General Election on Wednesday June 2.

THE SCALE OF THE CRISIS

Between 1990 and 1997, total formal employment fell by 8.7%. Population growth at 2.2% consistently outstrips GDP growth, compounding the structural unemployment crisis that South Africa faces.

Unemployment rates are estimated at between 20% and 36% of the total available work force. Over 500, 000 jobs have been lost from the formal economy since 1994. Approximately 4.5 million dependants of wage earners are affected.

Every job loss represents another piece in a jigsaw of human misery.

REASONS FOR THE CRISIS

To create jobs in this new era of globalisation, South Africa needs to gear its economy to the export of value added goods. To do this we must make our economy internationally competitive. This means encouraging labour market flexibility, tackling inflation, creating a favourable environment for foreign investment and reducing our taxation levels.

The unemployment crisis has grown worse over the past five years because the Government has failed to take the hard choices necessary to tackle the structural problems of the national economy. Too often long-term economic gains have been traded for short-lived social benefits, and policies have been implemented which have had the specific effect of destroying jobs.

• The implementation of the Growth Employment and Redistribution (GEAR) strategy, which has the support of the IFP, has been constrained by the ANC’s tripartite alliance with COSATU and the SACP.

• Elements of our labour legislation have empowered trade unionists whose interests often conflict with those of the unemployed.

- Privatisation, which is a vital element of the IFP’s macro-economic strategy, has proceeded at a snails pace due to a lack of political will on the part of the Government.

• Black empowerment, which should have been implemented to expand our economic base, has instead been used merely as a redistribution tool to the benefit of the fortunate few.

• Foreign investment has not been pursued with the vigour required and business compliance costs have frightened off foreign capital.

- Insufficient incentives have been created to promote domestic fixed capital investments and encourage savings and capital formation. This shortage of capital constrains economic expansion and contributes to crippling interest rates.

- The Government has failed to adopt a clear strategy to promote export-led growth and to assist South African business in penetrating foreign markets.

The IFP has argued for many years that government’s role must be as an enabler; creating an environment in which business can flourish, wealth can be created and jobs provided.

Instead of heeding the IFP’s advice, the Government, under pressure from organised labour, has implemented policies that have created a whole new series of obstacles to business expansion. This has had the direct effect of destroying jobs.

The IFP’s vision for the new South Africa is as a high wage/high skill economy. We will transform South Africa’s economy by developing our skills base and offering a regulatory and fiscal environment attractive to foreign investment.

We have no time for those who suggest that South Africa’s only future is as a low-skill, sweatshop economy, seeking to undercut the wages of the world’s poorest countries. That is no ambition for the great nation that South Africa can become.

The IFP does not pretend, as the ANC did at the last election, that "jobs, jobs jobs" can be created overnight. We do not deal in the devalued currency of slogans created today and forgotten the day after the election; the IFP holds to the hard currency of tough choices and realistic goals.

SUPPLY SIDE MEASURES

Beyond its commitment to macro-economic stability, the Government has failed to take the necessary measures to stimulate growth. Despite persistent IFP pressure, it has largely ignored supply side measures.

An IFP government will provide appropriate incentives and assistance to promote research and development, directed specifically towards product development, modernisation of manufacturing processes and the investigation and determination of market opportunities.

We will establish a Business Training Forum to advise government on directing skills and training resources towards the actual needs of business. Tax credits and grants will be provided to companies prepared to invest in training our work force.

We will establish a National Computer Literacy Programme, in association with private industry, to provide opportunities for our people to gain computer literacy.

We will restore control of education policy to provinces. This will allow innovative solutions to the failures of our current education system. It will bring an end to the suffocation of initiatives through ANC centralisation. Each province will be able to learn from the other. Success will be replicated. Failure will no longer be uniform.

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Labour market flexibility is vital if we are to create the jobs required in South Africa. The IFP’s overall labour market policy will be aimed at increasing flexibility. We will promote wage settlements in line with increases in productivity and inflation.

Other reforms that would increase flexibility could include a lower wage schedule for young trainees and increased incentives for more workshifts and job-sharing arrangements, where overtime work is cut and more permanent employment created.

Wage negotiations should be conducted at factory and plant level and not in central bargaining councils, which fail to take account of specific market conditions and which impose costs on small employers that they often cannot afford.

The IFP in government will undertake a general review of all labour legislation enacted since 1994. The review will determine to what extent the new laws have led to increased costs for employers and any consequent loss of employment. Those laws that are found to have unnecessarily increased labour costs will be amended or repealed.

All future legislation will be subject to an Employment Impact Assessment Study. No legislation will be allowed to proceed that will have a negative impact on employment.

The IFP in government will correct the general fall-off in infrastructure investment. We will shift resources from current account expenditure to the capital side to address our infrastructure requirements. This will create jobs, both skilled and unskilled.

Infrastructure investment will send an important message to foreign investors that the Government has confidence in the country. Well-targeted investment can play its part in job creation and should be focused on imparting permanent skills to the work force.

PROMOTING SPECIFIC SECTORS

The IFP in government will promote specific industries that have shown the potential for significant employment growth.

The service sector is a high employment generator with great potential for growth, particularly in tourism. In order to ensure the high quality services that the consumer demands, government will need to promote a national education drive involving all its departments, to uplift skills and human resource development.

The Tourist Industry: We will assist the tourist industry to expand and develop. We will place particular emphasis on eco-tourism which is the new global growth industry. Our tourist industry tends to end at the beaches. With assistance from government, the tourist industry should be encouraged to exploit the opportunities of marine tourism in the waters around South Africa.
The IFP will significantly increase the resources available for marketing South Africa as an international tourist destination. Compared with our major competitors, South Africa has a very poor record of selling itself abroad.

The Informal Sector

Recent dramatic increases in activities in the informal sector of the economy appear to indicate that the unemployed are prepared to work for lower wages than those offered in the formal sector.

The IFP in government will promote and encourage the informal sector through business training schemes and mentoring support. Attempts will be made to bring the informal sector into the mainstream economy without compromising its essentially informal nature through excessive government regulation. The possibility of allowing selected exemptions from local regulations and taxes will be investigated.

SMALL AND MEDIUM SIZED ENTERPRISES

The IFP in government will heavily promote small and medium sized enterprises as a key to employment generation. Already this sector provides 33 per cent of South Africa’s GDP and employs about 45 per cent of the work force.

We will keep regulation and government intervention to a minimum to reduce compliance costs on this sector. We will provide targeted assistance for skills training programmes and offer support for marketing and export initiatives.

By providing extra incentives to save we will create greater capital resources for the SMME sector to draw on at lower costs. This will assist in the expansion of this sector.

We will maintain a stable macro-economic framework in which foreign business can feel the confidence to invest. As foreign investors regain confidence in emerging markets, we will aggressively pursue inward investment. By getting the economic fundamentals right, we will make South Africa the emerging market in which to invest.

The Inkatha Freedom Party has created a ten-point plan to kick-start South Africa’s economy and create the jobs required to meet the aspirations of all South Africans. We do not pretend that this plan will provide instant solutions. The IFP has always rejected the easy but empty promises of other political parties.

The IFP will be clear and frank with the people. The road to economic prosperity and full employment will be long and hard. But because we do not make false promises; because our record of action speaks for itself, we can feel confident in commending our ten-point plan to all the people of South Africa.

Promoting Competitiveness: To promote export-led growth, South Africa has to get competitive. To do this we need to reduce the cost structure of our economy, by bringing down inflation, encouraging wage flexibility, reducing taxation levels and opening up the South African economy to competition.

By exporting primary commodities, South Africa is currently exporting jobs we could create at home. The IFP in government will assist our industries in adding value to what they export. This has great potential for job creation.

Training our Work force: We must make our education system relevant to a changing world. We need to give our children not only skills but skills in the high-growth industries such as information technology.

We will invest in the educational infrastructure of the country, improving standards in schools, technikons and universities. We will provide industry with financial incentives to train and skill its work force. We believe that it is business that can most accurately determine the skills needs of the economy. We will end wasteful government training programmes that are irrelevant to the needs of business and redirect resources to schemes sponsored by industry and approved by government