Fast-tracking social security

Pat Sidley reports (Business Day, January 25) that a 'Social security system is a priority' for the cabinet. So let's consider how to afford a 'non-negotiable minimum package' to benefit 'millions who live below the poverty line' or 'without any means of survival'.

Obviously the 'package' will come from taxpayers. And presumably the cabinet still wants rapid economic growth, realising that this will require containing or further shrinking the overall government participation in the economy - its taxing, spending and regulating.

Rather than making huge efforts to 'reinvent the wheel', perhaps we can learn from a 1980 document from the Selsdon Group of British conservatives, called 'A Beginner's Guide to Public Expenditure Cuts'. It states: 'Only by cutting out some state activities altogether can this or any government concentrate on that very limited list - defence, preservation of the value of the currency, maintenance of order, guaranteeing a minimum standard of life to the poorest - of activities which, arguably at least, the state and only the state can perform. The last-mentioned is, of course, not the least important duty of the state

Poverty is a lack of money, and its cure is and always has been more money, not state services of questionable value provided free (or at artificially low prices) at the point of consumption'.

This line of thinking suggests two simple actions, chop chop. First, government should quantify the social security goal, so how about handing out R1000 a month to the 5 million designated-neediest South Africans? That's R60-billion a year.

Secondly, government should close down unnecessary departments. The aim would be to release at least the R60-billion a year, but preferably much more so as to eliminate national debt, reduce taxation, and encourage growth. It might be fun (and even democratic) to run a referendum on prioritising closures or full privatisations - how about social development, arts & culture, correctional services, environment & tourism, trade & industry, sport & recreation, water & forestry, posts/telecoms/broadcasting, minerals & energy, defence, transport, land & agriculture, public enterprises, education, labour, public works, housing, health, and so on?

Why does the above suggest Minister Zola Skweyiya's Social Development department first for closure? - because presumably the R1000 monthly hand-outs are best managed privately on contract from the Finance department. That way you avoid the waste, corruption and 'evaporation' of funds that characterise government departments everywhere. As long as it is not regulated to death, the privatisation route also works best for anything else, such as defence or house-building or providing a stable currency, which a government prefers to fund with taxes instead of leaving entirely (like beer and tomatoes) to the market and private choice.

Let us hope this 1980 approach saves us endless summits, committees and inquiries, because the poor are waiting.

Source: Dr Jim Harris is a freelance researcher and journalist. He maintains the Privatisation Update which appears under Publications on this website.