Job creation through state provision of services instead of the tender system
DATE: 12 October 2012
PRETORIA - A study on the extent to which the government can create more jobs by shifting from a system of public procurement of services through a tender system, to the state procurement of services, showed that there could be merit in such a shift.
Reflecting on research highlights at the launch of the organisation’s annual report for the 2011/2012 financial year, Dr Olive Shisana said the study used a computable general equilibrium (CGE) model. CGE models are well suited to provide information on tracing impact throughout the economy.
The study showed that there are interesting potential labour market changes due to simulating a scenario where government provides services instead of subcontracting to the private sector.
“Governments all over the world have at one point or another been obliged to find ways of creating employment for their people, and this study suggests a possible, albeit unpopular, avenue,” Shisana said. She cautioning that a more in-depth analysis to allow for assumptions that mimic as much as possible the situation on the ground should be carried out.
This also means squarely addressing issues of corruption and public sector inefficiencies in their broadest sense. Pointing to annual tracking studies conducted by the HSRC to gauge public opinion, the South African Social Attitudes Survey (SASAS), she said there are mixed levels of satisfaction with government performance on issues such as service delivery.
While the majority of the public is satisfied with the provision of services in the areas of social grants, education, electricity, HIV/AIDS treatment, the public was moderately satisfied with the provision of water and sanitation, and less so with the provision of health services and refuse removal.
However, when it came to job creation, crime reduction and low cost housing, as the figure shows, there were concerns.
Figure 1: Level of satisfaction with different areas of government performance, 2003-2011 (% satisfied or very satisfied)
Figure 2: Percent of public officials and leaders considered corrupt, South Africa 2011
Figure 3 shows the perceived reasons (%) by the public for the high prevalence of corruption in the society in 2011.
The SA Attitudes Survey is carried out annually to monitor implementation of government policies or programmes as well as social, economic and political perceptions. It serves as an evaluative tool informing decision and policy.
The HSRC currently has about 150 ongoing research projects. Other major areas of work described in the annual report include Education and Skills Development, the Research and Experimental Development Survey, a survey to evaluate health and nutrition, and the 4th National population-based survey to assess the state of HIV, AIDS, behaviour and health.
Performance of the HSRC during 2011/2012
On the performance of the HSRC over the reporting period, Shisana said the organisation has maintained its unbroken record of unqualified audits and had a very successful year in terms of meeting its legal mandate.
She said most predetermined objectives, which formed part of the strategic goals of the organisation, were met or exceeded. The HSRC was also in a position to channel more funding for research as the organisation achieved several costs savings, for example, using a minimal of consultants for support services, and bringing down administrative and other costs.
For the first time, the HSRC income exceeded R 350 million, comprised of R181 million from government and R171 million from external resources. The organisation has weathered the previous year’s economic storm by engaging in a concerted effort to raise funds to meet its mandate and ensure sustainability. It has also been able to spend the additional money to achieve or exceed the goals it set on advancing scientific knowledge, contributing to research for development, enhancing skills and preserving data for public use, while transforming the organisation.