South Africans dump the government

 ·9 Jun 2024

South Africans have reduced their reliance on government services from 2019 to 2023. It ranges from education to electricity, policing, and public housing. 

The declining quality and availability of public services has resulted in many South Africans turning to private-sector alternatives that provide similar services to their government counterparts, such as private security, healthcare, and education. 

A reduction in electricity usage from government-run Eskom has been well documented, with demand declining nearly 8% year-on-year.

However, a significant reduction in the usage of other government services has gone mostly unnoticed and only recently started making headlines.

In a report released late last year, Stats SA revealed a sharp reduction in South Africans interacting with various government services. 

It attributed this decline to a lack of access to government services, a lack of trust in state-run institutions, and individual experiences of corruption impacting the state’s legitimacy. 

Financial services firm PwC analysed this report and said the decline reflected a steady deterioration in the quality of public services. 

The state’s capacity had been withered away due to corruption and incompetence, resulting in South Africans turning to private alternatives. 

The country’s public sector is also under increasing pressure due to a reduction in funding and resources, making it incapable of providing the quantity and quality of services it once did. 

Stats SA’s report shows that the decline in government service usage is widespread, spanning all sectors and even relatively well-run institutions.

In 2019/20, over 43% of individuals used public transportation services. However, this figure dropped to 37.5% in 2022/23. The use of public clinics declined from 35,4% to 31,7% in the same period. 

In contrast, services such as courts (2.4%), public housing services (2.4%), and correctional services (0.5%) were among the least used in 2022/23.

The declining use of government services is shown in the graph below from Stats SA. 

South African businesses have engaged the government to help it capacitate key state institutions, particularly state-owned enterprises. 

Business Unity South Africa (BUSA) has been working with the government to address the challenges faced in delivering energy, logistics, and crime services. 

Their collective efforts pave the way for third-party train operators to enter the rail logistics market in 2024.

Standard Bank Group CEO Sim Tshabalala has even pleaded with the government to capacitate the state and thus make it easier to do business in South Africa. 

Tshabala said the country has incredible competitive advantages but has failed to capitalise on them. He called for the state to improve its efficiency and capitalise on them. 

“Please improve the quality of our institutions. In the case of South Africa, we use the lovely phrase ‘Please capacitate the public sector’.”

“Some parts of the public sector are excellent, such as the National Treasury and the Reserve Bank. Replicate what is happening in those across the board,” Tshabalala said. 

“Please capacitate the state,” he repeated. “Please professionalise it. Please continue to make doing business easier.”

Standard Bank CEO Sim Tshabalala
Standard Bank CEO Sim Tshabalala

However, governance expert Dr Harlan Cloete explained that it is not as simple as recapacitating the state and upskilling government employees. 

The lack of capability and capacity is the root cause of many governance failures in South Africa, but there is a deeper issue at play. 

The government has spent R40 billion in the past decade to upskill its employees and enhance the efficiency of government services. 

However, this has failed to improve access to public services and their quality, resulting in people losing trust in the government and turning to the private sector. 

Cloete said the problem is that even if government institutions and state-owned companies are given more resources and employees are upskilled, it is still a toxic environment to work in. 

A toxic environment, filled with corruption, makes employees less productive and government services less efficient. 

He explained that, in some cases, the wrong people are employed, and no matter how much the government spends to upskill them, they cannot deliver. 

By Shaun Jacobs. This article was first published by Daily Investor. Read the original here.

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