Cry of the Xcluded |Press Statement |22 April 2020

Nearly one month into South Africa’s lockdown, the vast majority in society faces tremendous suffering and hardship. We have no income, we are scrounging for food, we are harassed by the police and SANDF, we are subjected to violence in the home. And only now the government responds with a social and economic policy.

The opinion makers, mainstream media, comfortable academics, the NGO crowd and centrist trade unions all tell us we must welcome R350 – a loaf of bread a day. It is too little and too late. This R350 will not  be able to buy food, electricity, toiletries and pay the expenses that we have as the unemployed.

By closing our schools while not putting in place an alternative to the school feeding scheme you made our children go hungry. You belatedly realise the suffering this has caused by now increasing the Child Support Grant by R466.66 on the average for 6 months. Must we thank you for recognising the flawed approach of the token food parcels you distributed, many of which were gobbled up by your comrade ward councillors and other officials?

Let’s be clear, there are over 700 informal settlements in Gauteng alone. 25 years of business as usual policies have led us to a point when the distribution of 250 000 food parcels within two weeks will be a far cry from what is needed, even if all of these food parcels reach a destitute family. What is needed now is a move towards true food sovereignty, to achieve this requires the radical redistribution of land so that we can feed ourselves. Agribusiness and major retailers are the biggest opponents of such a drive as it would cut right into their profits and ability to exploit workers and the land. But we must put people’s livelihoods over the profits of a minority.

The aged, who are physically cut off from the support of their children, who in turn are being retrenched in their droves and robbed of an income, must now make do with an additional R250!

These new R50 billion in grants represent just 10% of your “stimulus package” but we, the poor, the destitute, the unemployed constitute more than two thirds of the population.

And another R200 billion is a loan guarantee to SA’s big banks. This will not involve real government money, except when the banks cannot get back their money from the businesses they lend to. And no doubt, these loans will be profitable for the banks – through the magic of compound interest.

So in actual fact, in the face of 40 million people who are facing the fear of death, either from the pandemics of poverty or coronavirus, the government is providing a stimulus of between R170 and R200 billion. This represents just over 3% of the size of our economy – not 10%. This 3% fiscal stimulus still leaves South Africa at the low end of the world war against coronavirus – even though our frontlines are among the bloodiest given our world-leading inequality rate.

And what of our brothers and sisters with jobs, the ones now in the firing line of businesses which are abusing their power in this time of crisis? You have promised them R40 billion in wage support but you provide no details. Will this be channelled to the UIF? The UIF,  which is currently so overwhelmed by the hardship the bosses have caused, that they cannot deliver timely relief? And what about women in the care economy, those that have and continue to keep households going: domestic workers, community health workers, the informalised child minders? How will they prove loss in wages and be able to obtain your wage support? Why could you not do what other countries have done and guarantee the wages of workers, even at 80%, like the right-wing Tories in Britain?

So must we celebrate the boldness, decisiveness of this government? Has it done what has become a neoliberal cliché in time of great distress “never let a crisis go to waste”?

Ominously, what comes with this package is the promise of “structural reform” – homegrown of course, because the IMF, World Bank, the African Development Bank and the New Development Bank will supposedly not seek to impose their own versions of structural adjustment. We are told, “don’t be ideological – these loans will come with few strings attached.”

Let’s see if they are loans made in local currency to be repaid in local currency; let’s see the genuine interest rates; let’s see the conditions. Will it be like the World Bank’s massive Medupi loan, to overcome our electricity crisis? See where that has led us. A loan that is so odious the current President of the World Bank has himself labelled it corrupt! And if we now take World Bank funding, will this make it impossible for the government to repudiate this Odious Debt?

And as for the structural reforms President Ramaphosa and Finance Minister Mboweni are promising? Are they not what business has been calling for? Deeper wage reductions, already imposed this month when the government reneged on the current bargaining agreement with public sector workers (who now take an actual 4%+ wage cut, depending on the rate of inflation this year). The President and the Minister of Finance should be honest with the nation and tell us how many public sector workers must join the ranks of the unemployed in order to reduce the public sector wage bill by R161 billion over the next three years.

Does anyone imagine that the IMF, World Bank and credit rating agencies like Moody’s which downgraded the country in the midst of the COVID-19 pandemic, will not enforce these disastrous budget decisions of this government?

Perhaps the public sector workers numbering tens of thousands that will be retrenched this year to reduce government’s wage bill will have less to worry, now that they can get R350 relief as part of the unemployed. Oh, but that is just for the next six months! And then it is back to normal for the army of unemployed now in excess of 11 million: zero, nothing

And do these structural reforms not entail using the crisis of the SOEs to privatise them? SAA, for all intents and purposes is history. ESKOM will be unbundled and private corporations will be allowed to make profit in the electricity sector, speeding up ESKOM’s death spiral. And followed by more retrenchments.

While the poor, working class, and unemployed are presented as the main beneficiaries of this package, the big banks are well looked after through the R200 billion loan guarantee. Absa, Nedbank and Standard Bank paid R17.4 billion to the rich in April in profits even though the Reserve Bank Governor asked that they do not do this and drain vital foreign currency reserves. They did not care; clearly, the economic order of the rich must not be touched. Our government could do what Denmark and Poland have done by refusing to give any Coronavirus support to companies that put money in tax havens to avoid paying tax, but this is nothing for South Africa; the state refuses to disturb the economic order of big capital!

What Ramaphosa and Mboweni are doing is tossing out a few crumbs from manicured fingers, while taking back much more with a clenched fist, using a policy and army already well practiced in the art of brutality. Those who celebrate this “historic”, “momentous” “unprecedented” package in the belief a new future awaits, should be a lot more cautious! The struggle continues but the momentum is not with the dispossessed and Xcluded!

Issued by the Cry of the Xcluded, including:

SAFTU, AMCU, Assembly of the Unemployed, Abahlali BaseMjondolo, Inyanda


For more information or comment: 

  • Zwelinzima Vavi  (SAFTU) 079 182-4170
  • Nonhle Mbuthuma (ACC) 076 359-2982
  • Pinky Langa (SAGRC) 078 7842148
  • Joseph Mathunjwa  (AMCU) 076 346-6402‬
  • Khokhoma Motsi (BUM) – 073 490 7623
  • Ayanda Kota (UPM) – 078 625 6462