Ramaphosa’s SONA promises vs reality
In 2019, President Cyril Ramaphosa delivered the first State of the Nation Address (SONA) of the country’s sixth democratic administration, setting out the government’s priorities and promising a “new dawn” for the country.
With the current administration’s term coming to an end, Ramaphosa is scheduled to deliver the last SONA this week before the 2024 general elections.
We looked back on some of the president’s key promises at the start of his term in 2019 and how they actually played out in reality.
These promises and focus points need to be understood in the context of the unprecedented turmoil and upheaval caused by the Covid-19 pandemic, which hit South Africa (and the world) between 2020 and 2022, with many effects still being felt today.
Despite this, some of the key focuses of Ramaphosa’s 2019 SONA – unemployment, a stagnating economy, Eskom, infrastructure development, healthcare, and corruption – have been persistent problems in South Africa long before the pandemic, and continue to this day.
Employment
A major inhibitor of the country’s economy is the fact that it has one of the highest unemployment rates in the world – a woe that Ramaphosa extensively highlighted in his 2019 speech.
South Africa’s already sensitive employment statistics faced an unprecedented gut-punch in 2020, where millions of job losses were seen during the Covid-19 pandemic.
While strides have been made in recovering from the pandemic – with employment numbers higher than before the start of the outbreak – unemployment statistics still paint an unpleasant picture, especially among the youth.
At the time of the address in 2019, data from StatsSA highlighted that the official unemployment rate sat at 29.1%, while the expanded unemployment rate definition sat at 38%.
The most recent data shows that the official unemployment rate is 32.6% (3.5 percentage points higher), while the expanded definition is 41.2% (+3.2pp).
Youth unemployment figures (historically much higher) were a particular focus in Ramaphosa’s 2019 SONA.
“The economy needs to create far more jobs for youth than it currently does; merely to keep the youth unemployment rate steady,” Ramaphosa said, promising to create “two million more young people… in employment” by 2029.
At the time of the speech, the percentage of young persons aged 15–34 years who were not in employment, education or training (NEET) was at 40.3%.
Since then, NEET youth unemployment has grown to 43.4% in 2023 (4.9 million people, +3.1pp), with unemployment for NEET youth between the ages of 15-24 years sitting at 60.7%
Attempts have been made to try and deal with this, but the numbers speak for themselves.
A notable stride by the government in generating employment has been seen in the implementation of the Presidential Employment Stimulus (PES). Launched as part of the government’s response to the pandemic in October 2020, the stimulus has seen around 1.5 million “work and livelihood support opportunities” created for unemployed South Africans – 83% of which are youth.
However, whether these can be counted as sustainable jobs is debatable.
Other interventions from the government include the signing of Framework Agreement, which pledged the creation of an estimated 275,000 jobs annually, outlining its policy on having large reliance on partnerships with the private sector, and the sector itself, it create jobs.
Economy
In 2019, Ramaphosa pledged to create an “economy [that grows] at a much faster rate than our population.”
To achieve this, economic growth would have to meet the low bar of around 1% per annum (South Africa’s average population growth rate over the past five years).
In 2023, the country likely scraped by with at least a small positive growth rate.
At the time of his 2019 SONA, the president said that “our country is confronted by severe challenges; our economy is not growing – not enough jobs are being created… this is the concern that rises above all others.”
While Covid-19 wreaked havoc on the economy, GDP growth stagnated for years. The International Monetary Fund said that “crippling power cuts, volatile commodity prices and a challenging external environment” has seen the country continuing to show a weak growth performance.
Find more statistics at Statista
According to data from the World Bank, in 2019, the country’s real GDP sat at $260 billion – this rose to $399 billion in 2023.
However, finance minister Enoch Godongwana recently said that the level of growth is “too low” to support the country’s developmental goals. “Accordingly, we must take action to put our economy on a higher growth trajectory,” he said.
South Africa’s currency has also seen a dive. On the day of the speech in 2019, the rand was trading at R14.33 to the US dollar. It has since lost 32.17% of its value, trading at R18.94 to the dollar at the time of writing.
Again, attempts were made during the sixth administration to turn things around – with mixed success.
On 15 October 2020, President Cyril Ramaphosa announced a “reconstruction and recovery plan to drive growth that is inclusive and transformative” – Operation Vulindlelam a joint initiative of the Presidency and National Treasury to accelerate the implementation of structural reforms and support economic recovery.
The structural reforms, according to the presidency, “are intended to change the structure of the economy to reduce input costs, lower barriers to entry and increase competition. Lower costs and greater efficiency increase the competitiveness of the economy and create new opportunities for investment.”
In December 2023, the presidency released a progress report of the three-year implementation of Operation Vulindlela – largely relating to reforms in the electricity and logistics sector, which are only now starting to take shape at the end of his term.
Eskom
Another item on top of Ramaphosa’s 2019 SONA agenda was dealing with the issues facing state-power utility Eskom.
“One reason for the lacklustre economic performance has been the load shedding early [in 2019], together with the continued uncertainty in the supply of electricity and the state of Eskom,” said Ramaphosa in 2019.
“The lesson is clear; for growth, we need a reliable and sustainable supply of electricity,” he added.
Ramaphosa said at the time that the financial position of the utility remained a “grave concern”, and promised strides to turn the power utility around by prioritising “a better maintenance of its generation fleet, reduce costs and ensure adequate reserves of coal.”
However, as many South Africans know by now, the energy crisis only got worse in the following years. Since 2019, load shedding ramped up significantly, with each year after the SONA setting a new record for the worst year of load shedding ever. This culminated in 335 days of blackouts in 2023.
While nowhere near to fulfilling the SONA 2019 promise of a better Eskom, the sixth administration did act – even if it was out of sheer urgency and necessity.
The President eventually established a National Energy Crisis Committee, introduced an Energy Action Plan, and created a Minister in the Presidency for Electricity, all in attempts to “end load shedding” and turn around the fate of Eskom – whose debt now sits at around R408.62 billion (down from over R480 billion in 2019/2020).
Over the past five years, the government has spent R181.6 billion in bailouts for Eskom. Additionally, the utility is set to receive further government support, with the National Treasury providing it with R254 billion in debt relief over the next three years.
It was estimated that in 2023 (which saw the worst year of load shedding on record), the South African economy lost R1.6 trillion as a result of the power cuts, and the SARB has noted on several occasions that the blackouts have wiped 2 percentage points from GDP growth.
Infrastructure Development
“Infrastructure is a critical area of investment that supports structural transformation, growth and job creation; It is essential to the economic rejuvenation, to giving meaning and effect to the New Dawn,” said Ramaphosa in 2019.
Since 2019, the government’s approach to infrastructure development has been based on partnerships between the public and private sectors and with local communities. However, as with all other promises, progress on this front has been slow and often delivered through forced urgency rather than progressive policy.
As with Eskom and the power crises, South Africa has entered a “poly-crisis” with water infrastructure, road infrastructure, rail infrastructure, port infrastructure and related structures all collapsing and deteriorating in some way.
Again, Ramaphosa was forced to set up various crisis committees with private businesses to address these issues, and plans are underway to do so – but things had to collapse before positive action was taken.
In 2023, it was reported that the total value of projects currently in construction was R313.5 billion. Projects worth about R21.4 billion – that mainly comprise of roads and human settlement – are said to have been completed.
However, infrastructure projects across the country have been facing significant delays and backlogs.
For example, the Department of Human Settlement’s most recent statistics show that there are 3,445 blocked and incomplete projects.
Reasons for these delays vary; but an increasing trend witnessed in South Africa is the rise of construction mafias stealing from and inhibiting the progress of infrastructure projects. Public Works and Infrastructure Minister Sihle Zikalala recently revealed that construction mafias cost the economy around R68 billion.
Healthcare
The 2019 SONA caused some waves when the president outlined the government’s plan to push ahead with and implement the National Health Insurance (NHI) scheme, which would pool public and private healthcare resources together to provide free universal healthcare.
Ramaphosa said that this included “accelerating quality of care initiatives in public facilities, building human resource capacity, establishing the NHI Fund structure, and costing the administration of the NHI Fund.”
Of all the lofty goals set for the NHI, the main target the administration managed to hit was getting the NHI Bill through most of the processes to become law.
The NHI Bill was passed by the National Council of Provinces in late 2023 and sent on to the president to be signed into law – with Ramaphosa promising to do so before the end of the term.
The signing of the bill into law will lay the foundation for establishing the NHI Fund, which will be the home of the billions of rands the government will need to draw from taxpayers.
This bill has faced widespread criticism, with regards to its constitutionality, procedural issues and overreach, amongst others.
Various questions remain – particularly on how the scheme will actually be funded, where the state will find the necessary human resources to run the system, and how much the whole affair will actually cost the country.
The laws are also expected to face mounting legal challenges – likely to stretch the government’s optimistic 10-year implementation plan into years and years of fights.
Rooting out corruption
Probably the central pillar of Ramaphosa’s campaign heading into the 2019 elections was to exhibit zero tolerance for corruption within his administration – this was echoed in his 2019 SONA.
The president promised action, reform and accountability in addressing the State Capture saga, and a “new dawn” for the ANC and its direction.
“We [have] resolved to cure our country of the corrosive effects of corruption and to restore the integrity of our institutions,” he said at the time.
The administration said it would commit “to address problems of poor governance, inefficiency and financial sustainability… building an ethical state in which there is no place for corruption, patronage, rent-seeking and plundering of public money.”
The steps that were said to be taken to “end state capture and fight corruption” include strengthening the:
- National Prosecuting Authority (NPA);
- Special Investigating Unit (SIU)
- South African Revenue Service
- State Security
Additionally, specific anti-corruption units were created, including the establishment of the NPA Investigating Directorate to prosecute state capture and other significant corruption cases. To date, it has enrolled over 34 corruption cases, charged 202 accused individuals and and 65 accused entities.
While numerous strides have been taken to address corruption, South Africa has not been able to shake corruption from its name. From the looting of Covid funds during the pandemic, to Ramaphosa’s own struggles with the Phala Phala scandal, the last five years have not done much to make the country and its government seem less corrupt.
Two recent examples are indicative of this: the first is South Africa being greylisted by the FATF for not doing enough to prevent money laundering and terrorism financing. While the country has addressed most of the issues raised by the FATF, it has become stuck over the strength of the NPA and other authorities to effectively prosecute implicated persons.
The second is the latest corruption perception index, where South Africa has just ranked at its worst levels ever recorded – where the country is now categorised as a “flawed democracy”.
Read: Government promises no corruption and accountability with the national state of disaster – this time
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