Hon Speaker, His Excellency, the President, hon Deputy President, hon members, fellow South Africans, the ANC supports Budget Vote No l. [Applause.] The ANC has tasked me to speak on the economy and focus on the achievements since 1994, growth and investment, the National Development Plan and policy orientation and interface with other policy instruments of the ANC and government, including the role of state-owned enterprises and development financial institutions.
We salute President Nelson Mandela for laying the foundation of economic transformation that we are building on today. We love tata [father] and wish him well.
The achievements since 1994 are the following: our economy has grown by over 80% since 1993 and national income per capita has increased by 40% in real terms; total employment has increased by more than 3,5 million since 1994; gross fixed capital formation increased from 15% of GDP in 1993 to an average of 20% over the past five years; over 1,6 million work opportunities were created in phase one of the Expanded Public Works Programme, the EPWP, and for the period ahead the EPWP aims to achieve 500 000 full-time employment opportunities; public debt was reduced by the ANC government from nearly 50% of the GDP in 1994 to 23% in 2008 ... [Applause.] ... the global economic crisis and the need for a cyclical stance have taken it to 41% of the GDP and most European countries are at 90% and above; the main budget revenue increased from R112 billion in 1994 to over R800 billion last year, while expenditure increased from R135 billion to R1 trillion.
With regard to growth and investment, the reality of growth internationally and the difficult challenges in the economy call upon us to construct a positive narrative and work together to implement it. There are many countries that have great instability, but their economic narrative is extremely positive.
Some South Africans want to focus on the negative. What is urgently needed is to focus on the positive. We need to build on our strengths, which are: good infrastructure, institutions that work, robust democracy, a dynamic private sector, strong public finance and healthy financial institutions.
Overall investment spending remained robust last year, growing by 5,7%. Strong capital investment by the public, the addition of electricity- generating capacity, relatively stable inflation and low interest rates are expected to support improved growth rates over the medium term.
It is true that consumer confidence remains weak and business surveys suggest fragile levels of confidence in the economic outlook. This is likely to constrain private household consumption and business investment during 2013.
Labour unrest and stoppages in the mining sector contributed to a much weaker economic performance in 2012. The present uncertainty in the labour relations in mining and other sectors requires concerted actions by organised labour, business, civic leaders and government.
We need to find a balanced, economically fair and socially responsible solution to gain higher investment, higher employment and improved living conditions. Infrastructure investment is not just about building and maintaining the energy, water and transport networks needed for faster growth, but it is also about raising our savings performance so that we can finance more investment and growth.
In urban development, we will see more investment in housing, rapid industrial growth and job creation. In rural development and agriculture, the ANC government is addressing constraints to land reform and improved support for emerging farmers. In further education and skills development there is great alignment between the skills that are needed to grow the economy and the curricula that our colleges offer.
In regional development and trade, we are beginning to build infrastructure and institutions across national borders that promote more and more rapid growth, investment and job creation.
The National Development Plan has contributed by focusing our policies and programmes on long-term growth and development challenges. The NDP builds on the foundation of the fiscal and monetary policy of the ANC government and acts as a catalyst of ideas to address challenges of growth, employment, environmental sustainability, redistribution, social cohesion, education, universal health coverage, social protection and regional economic development.
With regard to policy orientation, the 52nd National Conference of the ANC at Polokwane resolved that the ANC and its government must build the capacity of the state to pursue the objectives of a developmental state and to ensure that whilst SOEs and development finance agencies remain financially viable and profitable, their primary responsibility is to support and lead in strategic government development objectives, within a clearly defined public mandate of pursuing an overarching industrialisation programme.
State-owned entities, SOEs, and development financial institutions, DFIs, are powerful instruments for economic transformation and should remain firmly in the hands and control of the state, in order to respond effectively to the developmental goals of the ANC government. [Applause.]
SOEs and DFIs are not created to maximise profit or incur losses, but rather to drive the developmental agenda. [Applause.] The dual mandate of SOEs and DFIs is to achieve a balance between the required level of self- funding and undertaking developmental projects that the private sector under normal circumstances would not.
The policy orientation ensures that the SOEs and DFIs, which are tasked with a costly development mandate, must be strategically positioned to generate the revenue to pay for the costs of these mandates. The policy strategy is to use the strengths of SOEs and DFIs, in directing private sector investment in the productive sector of the economy.
This is designed to stimulate manufacturing and promote entrepreneurship development programmes that will enhance the deracialisation of the economy and the creation of new firms and industries.
In terms of the ANC policy, infrastructure and industrialisation programmes are two major pillars driving the growth and development of our economy. The industrialisation process should seek to construct a new, comparative advantage based on our natural resources.
We are pleased that Public Enterprises is playing a central role in supporting these two pillars. The ANC supports the budget. I thank you. [Applause.]
Business suspended at 17:15 and resumed at 17:35.