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Inequality 'bad for both rich and poor'

Date Released: Thu, 26 July 2012 00:00 +0200

SOUTH Africa is "pregnant with opportunity" to create a social compact for higher growth and development, says executive director of the Mapungubwe Institute and member of the national planning commission, Joel Netshitenzhe.

But to do so required that all sectors of society, including government, civil society, business and the trade union movement identify common objectives and make the sacrifices necessary to achieve them.

 Delivering a lecture at Rhodes University in Grahamstown, Netshitenzhe said there was recognition and concern across society that youth marginalisation and unemployment were unsustainable. With 20% of South Africa's poorest taking home just 2.3% of the national income, and 20% of its richest getting 70%, people were calling for a socio-economic Codesa.

"Those levels of inequality are unsustainable and bad for both the rich and the poor," Netshitenzhe said.

By 2030, the National Planning Commission had proposed there should be full employment. "

By then, nobody should live below the poverty line of R420 a month and there should be adequate social security." This required a serious social compact and "agents" prepared to make it happen.

A social compact required the ability of leaders of all sectors to identify trade-offs and make difficult choices.

"There has to be a trade-off between long term rewards and instant gratification," he stressed. This might include investing money for purposes of growth rather than accepting a higher salary. A social compact required strategic thinking, leadership, trust between the various sectors and forums for strategic engagement. This was difficult in a society like South Africa's.

A social compact therefore also required a strong and legitimate state that had the capacity and will to intervene when the need arose such as when social partners could not agree.

The lecture was organised by the Rhodes University Department of Political and International Studies as part of its "Teach-In Lecture series" which is looking at the so-called second transition.

By Adrienne Carlisle

Photo by Ross Shackleton

Source: Daily Dispatch

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