Employer of Last Resort? South Africa’s Expanded Public Works Programme (EPWP)

South Africa’s largest active labour market intervention (ALMP) is the Expanded Public Works Programme (EPWP). Its first five-year phase has been completed and a second phase, more ambitious by far than its predecessor, has commenced. Critical analysis suggests that contrary to the hype, the programme has thus far made little lasting impact on the poverty and unemployment it is supposed to address. The analysis is in four parts: the first is an exploration of the background to the EPWP, in its role as South Africa’s largest active labour market policy; the second presents an examination of aspects of the performance of EPWP Phase 1, looking in particular at target vs. actual numbers of job opportunities and training days. This section also looks briefly at the EPWP’s proposed monitoring and evaluation (M&E) programme, before undertaking a more detailed consideration of the published information available on the training/employment nexus. The section ends with a glance at weaknesses in one of the surveys (the Labour Force Surveys, LFSs) put forward as data sources for evaluating the EPWP during Phase1; the third considers aspects of the vast increases in the scope of EPWP from Phase 1 to Phase 2, of the way in which these have been communicated, and of the way in which they are to be funded, while fourth the looks at the possible contribution that this second phase could/may make to the goal of halving unemployment by 2014. This part of the paper reproduces a set of scenarios produced by the National Treasury and published in the Budget Review 2010. These point to the extreme unlikelihood of the unemployment halving goal being attained. The paper ends with a set of recommendations, many relating to the production and distribution of knowledge about the EPWP.

Flogging a dead horse: Attempts by van der Berg et al to measure changes in poverty and inequality

This paper seeks an explanation for the large differences in the extent and severity of poverty published respectively in van der Berg et al (2005: 2007a) and Meth (2006b). Headcounts in 2004 suggested by van der Berg et al (2007a) exceed by five million, those reported by (Meth, 2006b). Household survey respondents often under-report income (and expenditure). To address this, it is common (if not necessarily wise) to scale household survey income means until the grossed-up survey income totals are approximately the same as those yielded by the national accounts. The apparent reason for the differences between our respective poverty estimates lies in the poor quality of the income estimates in the surveys used by van der Berg et al as primary data source for estimating income distributions (by race). Scaling these survey estimates to make them consistent with the national accounts, it is argued, causes them to under-estimate the extent and severity of the poverty problem. As part of their analysis of changes in the welfare of Africans in South Africa since the advent of democracy (and in support of their claim that poverty has fallen), van der Berg et al attempt to measure changes in the racial shares of remuneration. The present paper ends with a brief examination of some of the problems of doing so using Statistics South Africa household surveys (the Labour Force Surveys) as primary data source. Welcomed by government because of the apparent progress they report in the fight against poverty, the possible consequences for anti-poverty policy (and for the poor) of the van der Berg et al figures being wrong are non-trivial.

How not to present poverty research results: The South African case

Because of their vital role in charting progress (or the lack thereof) in the pursuit of the povert y reduction, statistics are of obvious importance. In South Africa, these leave much to be desired.Disagreements among academics on the severity of poverty, the result of the failure of Statistics South Africa to conduct the appropriate surveys, are the inevitable result. Far from losing money (or sleep) as a result, some in the profession resort to further research, some of it quite highly paid, to squeeze new results out of old, often unreliable data. This could have serious consequences for the poor – policy failure caused by faulty monitoring can easily damage the vulnerable. Regardless of the reliability or otherwise of their findings, it is argued in the present paper that researchers would do well to offer them in a way that minimises the possibility of their being misinterpreted and/or misrepresented, and that maximises the likelihood that the non-specialist reader will be able to understand them. It is common practice to give poverty estimates in the form of the (FGT) ratios suggested by Foster, Greer and Thorbecke (1984), often without accompanying estimates of the absolute magnitudes involved. This, the present paper claims, allows overly optimistic conclusions to be drawn, making possible the concealment of rising misery behind a veil of aggregate improvement. Commencing with a glance in the abstract at the FGT ratios, the paper concludes that in order for poverty statistics not to convey a misleading impression of changes in the phenomenon they seek to represent, the ratios have to be augmented with sufficient information of concurrent changes in the income distribution. Most poverty studies look at changes in inequality. Often, however, the inequality results are not linked directly to the changes in poverty. As far as income poverty is concerned, the present piece of research suggests that doing so is the only appropriate way to present results. Having sketched a conceptual foundation, the paper looks at the regurgitation by government, without comment, of poverty statistics that directly contradict each other. After that, the strange case of an undeserved accolade government awards its anti-poverty policies, is found to be based upon a misinterpretation of their own findings by the authors of a recent poverty and inequality study (Bhorat and van der Westhuizen, 2008). A new set of poverty and inequality estimates (Leibbrandt et al, 2010), although it does not conform to the mode of presentation suggested above as necessary, points (as do the Bhorat and van der Westhuizen findings) to the strong likelihood that although the poverty headcount ratio may have fallen since the advent of democracy in the country, the poverty headcount is likely to have risen by several million between 1993 and 2008. An appendix at the end of the paper offers a little speculation on what poverty levels might have been had the AIDS epidemic not killed so many people.

Shortages of skilled labour power and capital reconstruction in South Africa

African Studies Seminar series. Paper presented 12 October, 1981The purpose of this article is twofold. Firstly, it seeks to evaluate the claims of those who argue that skill shortages are a significant force for change in South Africa. Secondly, it attempts to develop a critical analysis of an article by a Marxist writer, who somewhat surprisingly places 'skill shortages' well upstage in a recent article which examined the restructuring of capital in South Africa. The topic of skill shortages is a hardy perennial on the local scene, the more so because the race question tends to obscure the nature of class warfare here. According to a host of commentators, eliminating the colour bar will release a seriously binding constraint on the 'economy' and open the way to a period of unparalleled capital accumulation. Statistics on skill shortages produced to support this claim share one important characteristic and that is their almost universal unreliability. Given the conditions in this country, it is obvious that whether or not there really exists a skill shortage, a persistent belief that there is such a thing, particularly a belief that such shortages are widespread, is likely ultimately to have important political consequences

Half Measures: The ANC's Unemployment and Poverty Reduction Goals

Simulations suggest that under the most optimistic conditions, halving the official rate of unemployment would require 3.7 million jobs to be created between 2004 and 2014. Halving the number of expanded unemployed under pessimistic assumptions about the growth rate of the economically active would require 11 million jobs in the same period

Manufacturing sector productivity in South Africa in the 1980's : error and ideology in a contested terrain.

Thesis (Ph.D.)-Unversity of Natal, 1994.Estimates of the value of manufacturing sector output enter into many economic indices, especially those measuring productivity. The South African Central Statistical Services has twice made substantial errors in the output series. Revisions to correct the first of these raised the growth rate in manufacturing over the period 1970-80 from 2,6 per cent per annum (compound) to 5 per cent. This episode is not common knowledge. After examining the conceptual difficulties involved in producing output stimates, a practical technique for detecting errors in the series , the Euler Consistency Test, is presented. Developed, refined, and then applied to the South African data, it predicted, retrospectively, the first set of errors (using only the information available at the time those errors were made), then detected another set of errors , not previously known to exist. The study records the process by which the CSS was made to concede this second error. Acknowledgement only came after protracted correspondence and an examination conducted by a special committee formed to investigate my complaints. With 1979 set equal to 100, the output level in 1988 was originally given as 113,8. After investigation, the CSS raised this to 126,1. The magnitude of this second error is equivalent to the omission of the total output of the two SASOL plants commissioned during the early 1980s. Estimates of productivity growth by the National Productivity Institute using these incorrect figures are shown to have created a misleading picture of the sector's performance, especially in the sensitive debate over the relationship between wage and productivity growth. An attempt is made to lay the groundwork of an analytical framework for comprehending (from a Marxist point of view) the activities of ideological state apparatusses like the NPI. A review of the literature on theory choice is conducted, and the necessarily political nature of this activity is explored. The relative impotence of I science' in the face of ideology in a conflict-ridden society is considered. The question of the significance of disagreements between economists is examined, and prospects for convergence and consensus on certain issues are weighed