The Democratic Alliance (DA) has struck gold with its campaign to have a youth wage subsidy put in place. "Put the words ‘jobs’, ‘youth’ and ‘subsidy’ next to one another and people like it," a DA official remarked after the party’s march on the Congress of South African Trade Unions’ head office had radio stations and social media buzzing.
The march also lit a fire under the desks of some in the African National Congress (ANC).
Secretary-general Gwede Mantashe shortly afterwards called the Treasury to request a briefing on the subsidy, to which he had not paid too much attention.
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The DA’s activism has given the ANC a problem: if not the wage subsidy, which sounds so good, then what is the alternative?
The new words are "suite of measures," "comprehensive" and "accord". And as with all accords and negotiations, Economic Development Minister Ebrahim Patel is now in charge. The "suite", for the moment, still includes the youth wage subsidy proposed by the Treasury. It will also include: some kind of a "job seekers" grant, which hasn’t been defined yet; proposals from the Department of Labour about the creation of jobs centres; and various ideas around enhancing recruitment and matching of work seekers and available jobs.
All of these, with the exception of the youth wage subsidy, are pretty vague at this point and discussions in the National Economic Development and Labour Council (Nedlac), where the accord is due to be brokered, are under way. But while the wage subsidy is the best developed of the ideas, it is not universally supported by the government. Although it was formally endorsed by the Cabinet, in so far as it was included in last year’s budget, there was no prior process to build political support for it either in Cabinet or in the ANC.
The DA’s campaign has begun to make the wage subsidy appear as a silver bullet solution, being blocked only by the self-interested labour movement. But there are some real doubts, in government circles, particularly in Mr Patel’s department, about the cost it will take to create a sustainable job - estimated at R37 000 - and the fear of older workers being replaced due to the depressed economic climate.
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