How to ‘really’ radically transform the SA economy

It is really concerning that South Africa is a quarter-century behind with regard to education and the development of its people, the CEO of Investec Asset Management, Hendrik du Toit, said during a recent interview.

Over the last 25 years South Africa didn’t do the groundwork needed to keep up with an extremely competitive international environment. In a world where computers and robots were reducing job opportunities, it was important to ensure that the population was competitive. The issue was not about race or redistribution but about growing the economy to the benefit of all South Africans and ensuring that the poor and previously disadvantaged also reaped the rewards, he added.

Du Toit is not alone in his concern. Despite a narrative that has largely focused on political controversies and the downgrade of South Africa’s sovereign credit rating to junk, various commentators have stressed the importance of quality education to reduce poverty, inequality and unemployment in recent months.

On Monday last week, part-time NPC commissioner, Elias Masilela, said South Africa feared to deal with its real issues including how it could provide good quality services like education.

“If you resolve education as a country, you have resolved a significant part of the inequality conundrum that we are faced with,” he said.

Even before South Africa’s sovereign credit rating was downgraded to junk by both S&P and Fitch, Karl Leinberger, CIO of Coronation, argued that the downgrade was not the real issue – but rather underlying problems including the steady decline of primary and secondary education, imploding tertiary education, an absence of a national productivity ethic and the fact that South Africa’s people and companies were becoming increasingly uncompetitive internationally.

The sentiment was also echoed by the Old Mutual Investment Group’s chief economist Rian le Roux recently when he said: “There is only one way to pull people out of poverty, unemployment and reduce inequality and that is through education.”

On a visit to South Africa, prof Jeffrey Sachs, American economist and director of The Earth Institute at Columbia University, also argued that South Africa had to improve the quality of education to ignite economic growth.

“A fully-diversified economy requires a much higher skill level than the average available in the [South African] workforce.”

Research

That South Africa’s education system needs significant work is clear.

The World Economic Forum’s Global Competitiveness Report 2016/17 ranks the quality of the country’s primary education 126^th out of 138 countries. The quality of the higher education and training system is ranked 134^th while the quality of maths and science education is placed in 138^th position.

Highlights of Mathematics Achievement amongst Grade 5 South African leaners in the latest Trends in International Mathematics and Science Study (TIMMS) lay bare the poor average performance of pupils in mathematics. The authors noted however that the performance was “highly unequal”.

“Three in five South African learners (61%) do not exhibit the minimum competencies in basic mathematical knowledge required at the Grade 5 level. When achievement patterns are broken down by school type, the patterns reveal the depth of the inequalities present in the system. Approximately 84% of learners in independent schools, 67% of those attending public fee-paying schools and 25% of those at public no-fee schools achieved the minimum level of competency,” they said.

Yet, maths and science skills are critical in a world where technology and innovation is key to competing on the world stage.

Politics

Although #feesmustfall protests have put access to tertiary education firmly on the government agenda, there seems to be varying views within government ranks about the quality issue.

“The education system is not achieving the desired outcomes. Priorities for government in the years ahead include expanding access to and the quality of early childhood development, overcoming institutional weaknesses in basic education, broadening access to effective vocational and technical skills, and improving the impact of resources devoted to vocational training. In all these areas, additional resources may be needed – and strong interventions to unblock institutional constraints are required,” National Treasury said in its Medium-Term Budget Policy Statement.

Whether this will remain the case following president Jacob Zuma’s controversial cabinet reshuffle in which finance minister Pravin Gordhan was axed, is unclear. And although the ANC’s 12-point plan to radically transform the South African economy, refers to education on two occasions (“… ensuring connectivity of schools…” and “implement free higher education for the poor and produce no less than 5 000 PhDs per annum by 2030 and urgently generate more artisans”) it doesn’t explicitly refer to the quality of education.

As the ruling party gears up for its elective conference in December amid significant infighting and a national election in 2018 in which it hopes to regain its composure following the disappointing results of the municipal election, it is unlikely that the quality of education will receive the attention it deserves. Moreover, addressing the quality conundrum will require a critical and uncomfortable conversation with labour partners about evaluation and education time lost due to strikes.

Although fixing the education system will likely take years even under the best of circumstances, one also has to ask whether minister of basic education, Angie Motshekga, is really the woman for this mammoth task.

Ultimately, the problem is that South Africa seems to be stuck in perpetual crisis management mode, and only appears to deal with its issues once it has escalated to full-blown emergency status. In the meantime, government’s failure to address the quality shortcomings of the education system will widen the inequality gap and poor students will suffer the most.

With economists now predicting that it will be difficult to reach economic growth of 1% in 2017 following the downgrade to junk, South Africa cannot afford to let another year let alone quarter-century go by before it addresses the quality issue.

And yet, if it stays on the current trajectory, this is exactly what will happen.

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