The response goes on to say:
The state therefore requires a capable and effective public service in order to plan and guide the implementation of the national developmental plan.
We have already experienced the inefficiency of the Public Service. We just need to visit a public hospital or Home Affairs office to see the consequences of dysfunctional public service delivery. Our public enterprises lurch from one financial crisis to another, draining our scarce financial resources, yet they are viewed as entities through which the developmental agenda will be driven. The last thing our economy needs is the creeping hand of public service inefficiency clutching at its throat.
South Africa cannot afford to experiment with its economic freedom. A model that places the state at the centre of the economy as a controller of resources and a dispenser of patronage denies the economic freedom that should follow from the long and painful struggle for political freedom. Command economies across the world did not work because they denied this human right.
Policy choices must focus on unlocking the opportunities for all members of our society. The DA's vision of an open opportunity society remains rooted in an unwavering belief in the empowerment of the individual, through a focus on boosting the economic engine room that delivers the revenue for government to function. This is where government should focus its intervention.
Following the global economic crisis, governments across the world have been scrambling to put in place rescue packages to bail out industries and even whole banking groups. There is, however, a very clear understanding that when this crisis passes, as it most certainly will, the hand of government intervention will retract so that the real drivers of economic growth and revenue generation, that is, business and entrepreneurs, can thrive.
The South African response to the crisis is complicated by the outdated view that government can centrally command an economy. There remains a strong belief in government and amongst its alliance partners that, following intervention, the hand of government must remain firmly in command of the economy. Thus, under the guise of being a response to the recession, there exists a danger that government will command a far greater role for itself and never ease its hand.
This will have consequences when the recession eases and economic growth returns to our economy. We know that our economy will recover, we just don't know when and by how much. If the poison of government paralysis is injected too far into the veins of our economy, our ability to survive the recession, the possibility of an early recovery and the hope of a significant upturn will be severely constrained.
When economies contract and households experience financial pressure, their attention often turns to investment schemes that promise to deliver them from their financial hardship. This is fertile hunting ground for predators and the Financial Services Board needs to become more vigilant over unregulated activities in the nonbanking financial services industry. In particular, it needs to educate consumers that when returns appear too good to be true, they are. The FSB also needs to respond more rapidly when alerted to potential scams.
The SA Revenue Service plays a crucial role in ensuring that revenue required for government activity is collected. It does need to align its operation to the complexity of our economy. At the one extreme, it needs to ensure that the so-called informal economy is included in the tax net. To do this, it needs to have a clear understanding of what economic activity is taking place and ensure that the registration process is easy and cost- effective, and that the activity is appropriately taxed. At the other extreme, it needs to ensure that sophisticated schemes do not exist to deprive the Treasury of the tax revenue to which it is legally entitled.
Tax practitioners have for some time commented that our tax regime is overly complicated, and that amendments on amendments have created uncertainty to the extent that taxpayers are noncompliant through misinterpretation rather than mischief. A conversation on the increasing complexity of our tax regime is required and should be initiated to ensure that the social contract between the taxpayer and Sars does not become unnecessarily strained. Sars has successfully streamlined its revenue collection from salaried employees and can now focus on less captive taxpayers.
Information creates certainty. The role of Statistics SA is to provide information to all participants in the economy. Questions raised regarding its active role in the pursuit of job creation and poverty alleviation indicate that it is viewed by some as a participant in, rather than as a recorder of, economic activity.
In the future, Statistics SA will report to the Minister of National Planning. It is not clear how Parliament will hold it to account within this reporting structure, under conditions of relentless centralisation. It is, however, vital that Statistics SA does account to Parliament given its crucial role in providing the information that informs the allocation of available resources.
Census 2011 is an expensive and time-consuming exercise, and we cannot accept an undercount of between 10% and 17%, as previously experienced. Statistics SA must be permitted to report its findings without political manipulation of the results. It also needs to focus on how it presents its findings to ensure that its message and methodology are properly understood. The uproar following the release of unemployment statistics in March this year demonstrates this need.
Macroeconomic indicators point to the fault lines now evident in our economy. Economic activity is receding, unemployment is climbing, prices continue to increase, our current account deficit is widening, the rand is volatile, and poverty levels remain unacceptably high. Last year the International Panel on Growth made numerous workable suggestions on how to eliminate the binding constraints on growth. Unfortunately their message was drowned in the noise following Polokwane. There is no reason why the findings cannot be properly considered now. [Interjections.]
The National Treasury, Sars and Statistics SA perform a valuable role in our economy and their efforts are appreciated.
In conclusion, hon Minister Gordhan, hon Deputy Minister Nene and committee chairperson hon Mr Mufamadi, congratulations on your appointments. With our economy in recession, your jobs are much more difficult than they would be under more favourable circumstances. The DA wishes you wisdom and strength, and assures you of our support and rigorous participation in the process of guiding our economic recovery through the most appropriate macroeconomic policies.
Mr Micawber, in Charles Dickens' David Copperfield, summed it up in his observation:
Annual income twenty pounds, annual expenditure nineteen six, result happiness. Annual income twenty pounds, annual expenditure twenty pounds nought and six, result misery.
We can't avoid a miserable result now, but our actions can determine whether happiness returns. The DA remains focused on this outcome. Thank you, Chairperson. [Applause.]