CHAPTER TWO
THE INTRICACIES OF THE POLICY PROCESS: THE CASE OF EDUCATOR POST PROVISIONING
2.2.1 THE ESSENCE OF THE GEAR
The GEAR represents the considered strategy of government to rejuvenate the South African economy within a framework of economic policies designed to provide a stable environment for long term growth and development. According to the document, the key elements of the vision of the GEAR relate to:
• A competitive fast growing economy which seeks to create jobs for all work seekers.
• The redistribution of income and opportunity in favour of the poor.
• A society in which health, education and other services are available to all, and
• An environment in which homes are secure and work places productive (South Africa. Department of Finance 1996:3).
The document points out that notwithstanding the considerable progress made since the successful democratic transition in the country in economic development, job creation, which is a primary source of income redistribution, remains inadequate. It adds that the present growth trajectory of approximately 3% per annum:
• Fails to reverse the unemployment crisis in the labour market.
• Provides inadequate resources for the necessary expansion in social service delivery; and
• Yields insufficient progress towards an equitable distribution of income and wealth (South Africa. Department of Finance 1996:1).
Consequently, the GEAR argues that in order to attain sustained growth on a higher plane, transformation towards a competitive outward orientated economy is essential. The document claims that the GEAR strategy will attain a growth rate of 6% per annum and job creation of 400 000 per annum by the year 2000 (South Africa. Department of Finance 1996:1).
Pampallis and Motala (1998:7-8) point out that the key argument of the document seems to be that high levels of growth are essential for the delivery of social services such as education and for attaining equity. They add that the GEAR asserts the need for human resource development and for the effective training of managers and workers to enhance
productivity. In keeping with Levin’s (1998:131) postulation that education is a key component of a country’s ability to improve or maintain their economic welfare; the GEAR regards education as an important determinant of long term economic performance and income redistribution. The sustained improvement of the public education system is a high priority as is the growth in student numbers and improvements in mathematics and science education.
According to Weber (2002:274), the GEAR plan hopes to reduce the budget deficit to 3%
of GDP within four years and hopes to achieve this by cutting government spending amongst others. Therefore, careful management of the overall government wage bill is central to the GEAR strategy. Affordability considerations, maintenance of public services and macroeconomic consistency are considered paramount. Right-sizing of the public service is considered key to the management of the government wage bill (South Africa. Department of Finance 1996:8). In terms of government consumption expenditure the GEAR projects the following scenario:
Table 2.1: Integrated scenario projections, 1996-2000
MODEL CHARACTERISTICS 1996 1997 1998 1999 2000 AVERAGE Real govt. consumption (% of GDP) 19.9 19.5 19.0 18.5 18.1 19.0 Real govt. investment growth 3.4 2.7 5.4 7.5 16.7 7.1 Source: South Africa. Department of Finance (1996:7)
According to Nicolaou (2001:66), from the GEAR projections it is evident that government consumption expenditure is declining making it likely that allocations to education will continue to decline in real terms, thereby implying a decrease in the wages and salaries component to civil servants. Moreover, it is evident that government investment expenditure is expected to increase dramatically especially in year 2000 to more than double. Nicolaou (2001:67) adds that these projections are only possible given a 6% growth rate. The smaller the growth rate the more detrimental the effect on the government budget and its components.
2.2.2 THE RDP AND THE GEAR
The RDP was drafted, in the main, by organisations associated with the Mass Democratic Movements (MDMs) of the country, mainly COSATU. Hence, it articulated the concerns of the masses and was aimed at addressing the needs of the previously disadvantaged people of South Africa. The RDP assigned a pivotal role to the government in that it was to play a leading and enabling role in guiding the economy and the market towards reconstruction and development. It cautioned that policies aimed purely at economic growth would accentuate existing inequalities and perpetuate mass poverty (Terreblanche 2002:108).
Terreblanche (2002:109) points out that the merits of the RDP were that it clearly and comprehensively described all the distortions and injustices that had become part of South African society during apartheid. More specifically for education it stressed the need to redress the inequalities prevalent in the education system and as such was a policy designed to attain equity.
The GEAR on the other hand was an efficiency policy drafted by economists. In essence, it was a financial strategy aimed at stimulating financial growth in the country. It represented government’s strategy to revive the South African economy. The key argument of the GEAR was that high levels of economic growth are essential for the delivery of social services such as education and the attaining of equity (Pampallis &
Motala 1998:7) In other words, equity would result as a spin-off from economic growth.
2.2.3 THE GEAR AND ITS IMPACT ON EDUCATION
The GEAR forecasts that it could create jobs and increase GDP by 6% per annum. Since the economy’s national income cannot be controlled directly by the government, the government budget becomes the only variable that can be controlled. According to Nicolaou (2001:69), if the growth rate is 3% instead of 6% then the government’s budget needs to decrease dramatically since less revenue has been generated. As the government budget declines so does state expenditure on civil service salaries, social investment etc.
She adds that in reality the annual growth rate has been declining since 1996 with only
1.7% in 1997 and 0.1% in 1998. With declining growth rates, the smaller national income implies large decreases in government expenditure. The total education budget highlights this trend. Mabe (1998:12) therefore adds that the great irony is that the GEAR document notes that progress in education is vital for economic performance, redistribution and long term transformation of this country but then simultaneously calls for a cut in government spending on education.
According to the GEAR, emphasis is placed on education reform in a context of fiscal constraint, a focus on decentralization, cost saving and cost recovery (through user fees) and a shift of financial responsibility for education from public to private sources (Vally
& Tleane 2001:180). This, according to Nicolaou (2001:68), implies that the market system, through user fees, will create an unequal educational process resulting in an elite group of highly educated individuals who attend excellent schools on the one extreme and a mass of poorly educated individuals from public schools on the other. Further, as more services are provided privately (or not at all) the exclusion principle becomes more dominant. Mabe (1998:13) adds that the problem with this is that impoverished communities do not have the means to pay. Consequently, education may become a rare commodity afforded by only the rich. Learners from disadvantaged communities will not be able to attend better and more successful schools. Therefore, the GEAR objectives will in fact increase inequality between the races, gender and provinces (Nicolaou 2001:70).
According to Mabe (1998:12), the GEAR shows many similarities to structural adjustment programmes which reversed the gains made by many African states in the immediate post colonial era. Harber (1988:248), therefore, questions the extent to which educational policy in the new South Africa reflects the educational priorities usually associated with structural adjustment programmes. He adds that countries with structural adjustment programmes have typically undergone the following educational experiences:
• Cuts in the education budget
• A decline in the value of teachers salaries
• Stagnation and reduction in teacher employment
• A slowdown in progress towards education for all
• An increase in the learner-educator ratio
• A decline in enrolment rates
• A reduction in expenditure on teaching materials such as textbooks
• A shift from public finance of education to private finance
• A decline in access for the poor (Harber 1998:248).
2.3 THE GEAR AND THE MEDIUM-TERM EXPENDITURE FRAMEWORK (MTEF)
The manner in which budgets are put together (centralized or decentralized) impacts on the autonomy of the provinces in determining their expenditure on education in general and educator personnel in particular. Hence, a discussion follows on the South African budgetary process and budgetary reform as well as a link between the GEAR and the MTEF.
2.3.1 THE SOUTH AFRICAN BUDGETARY PROCESS AND BUDGETRY REFORM
The Republic of South Africa Constitution Act, 108 of 1996, officially adopted in 1997, changed the way budgets are put together in the country. The new budget process is much more decentralized, giving provinces a greater amount of choice in determining expenditures on health, education, welfare and the public service. The new budget process is much more complicated than the old one. In the past only one budget was produced for the whole country. Now, the national government and each provincial government must produce a separate budget – a total of ten budgets instead of one (Heintz 1998:5).
The new thinking focuses on budgets as a tool or operational plan to achieve government’s stated objectives. This means that a budget should be driven at all times by substantive policy norms. The net result is that budgets are now viewed as vehicles to produce specific outputs. In South Africa, budget reform is directed by the Medium-Term Expenditure Framework (MTEF) and the Public Finance Management Act. The MTEF is simply a planning tool that enables spending agencies to project the cost of existing
policies over the medium-term (3 years) and to plan for the incorporation of new policies by requesting extra money over the ceiling that rolled over from the previous year or by identifying potential savings (Wildeman 2001:1). Thus the introduction of MTEF in 1998 resulted in an expansion to the budgetary process. Instead of creating only a budget for one year, the national government and the provinces now have to produce budgets for the next three years (Heintz 1998:5).
The MTEF creates a mechanism for resolving the conflict between what is affordable (a top-down approach) and delivery needs (the bottom-up approach). This conflict is one of the basic tenets of economics – resources are limited but needs are not. However, it must be borne in mind that the final choice over resource allocation and policy remains a political one. The MTEF merely provides the mechanism with which policy can drive budgeting within the limits that the economy can afford (Walker & Mengistu 1999:27).
Chabani Manganyi (2001:34) the former Director-General of Education poignantly notes that the MTEF had a profound impact on the department’s understanding of the education system as a whole. He adds that the framework and its review processes made it possible for the Ministry of Education to examine its policy priorities by determining the main expenditure drivers in the system.
2.3.2 THE LINK BETWEEN GEAR AND THE MEDIUM-TERM EXPENDITURE FRAMEWORK (MTEF)
The MTEF is considered an offspring of GEAR. According to the Department of Finance, the purpose of the MTEF is to contribute to achieving consistency between the governments macroeconomic, developmental, social and other commitments. The macroeconomic and fiscal policy targets of GEAR were to serve as the point of departure for the development of strategies and objectives regarding government expenditure. Both the MTEF and GEAR exert similar forces on the government and education budgets.
According to Nicolaou (2001:74), the only difference between the two is that the MTEF is a medium-term policy tool which through strategic planning dictates the size of state spending for several years.
The fact that budgets are predetermined for the next three years within the context of fiscal discipline and expenditure saving leaves very little room for flexibility and hence does not allow for needs driven budgetary adjustments.