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DCoG’s delivery on the Millennium Development Goals (MDGs)

MR RICARDO HANSBY14 June 2011

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Millennium Development Goals (MDGs)Introduction

1. Eradicate extreme poverty & hunger

2. Universal primary education3. Gender equality &

empowerment of women4. Reduce child mortality5. Improve maternal health6. Combat HIV/AIDS, Malaria &

other deceases7. Environmental sustainability8. Global partnership for

development

A set of time-bound development objectives adopted in 2000 by world leaders from both developed and developing countries

The MDGs come to an end in 2015

DCoG linked to MDG1: Eradicate extreme poverty & hunger through:

1. The provision of access to basic infrastructure services

2. Job creation interventions to alleviate poverty

The information in this presentation is predominantly from the MDG report 2010, which was produced by the Government of South Africa, the Civil Society Organisations (CSOs), and the UNDP in South Africa. The preparation of the report was led by Statistics South Africa (Stats SA).

The Eight MDG Goals Direct linkages to DCOG’s Mandate

From 2000 To 2015

The MDG’s

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The UN’s statement on MDGs in South Africa:

“South Africa is committed to fulfilling its constitutional obligations to deliver socio-economic rights within the context of its national plan of action, Vision 2014, and the Millennium Development Goals (MDGs).In South Africa, one of the indicators of progress towards the achievement of the MDGs is the effective and equitable delivery of public services. While significant achievements have already been made in areas such as access to basic water supply, improvement in service delivery remains a priorityImprovements in the MDGs will depend on how well government and other stakeholders mobilise domestic resources to achieve these targets. The macro-economic environment of benign inflation holds promise, but even in the best of times growth reached a plateau at 5% in an economy requiring at least 7% to achieve both its employment and redistributive consequencesSouth Africa has experienced a decline in poverty largely as a result of a significant income transfer programme, massive reallocation of pro-poor expenditure, for example on housing, water, electricity and sanitation. Not surprisingly, South Africa has achieved or is close to achieving the dollar-based purchasing power parity adjusted targets.”

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Eradication of Extreme Poverty and Hunger in South Africa

Generic MDG targets applicable to all countries include:

• Proportion of population below $1 per day

• The poverty gap ratio • Share of poorest quintile in national

consumption• 4 Growth rate of GDP per person

employed• Employment-to-population ratio;

Proportion of employed people living below $1 per day

• Proportion of own-account and contributing family workers in total

In order to counteract the effects of unemployment, the post apartheid government focused on short to medium term solutions for eradicating extreme poverty & hunger. These include:

• Government based social assistance programmes such as the provision of free basic services & targeting the indigent

• Social welfare support • A broad-based employment-creation and

skills development focused on public works(EPWP);

• Major infrastructure programmes, with a focus on the national housing programme

MDG1: Poverty alleviation Global Targets

South Africa’s Approach & Targets

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DCoG’s Programmes Linked to Poverty Eradication Goals

MDG GOAL 1Eradicate Extreme Poverty and Hunger

1. Halve, between 1990 and 2015, the proportion of people whose income is less than $1 a day2. Achieve full and productive employment and decent work for all, including women and young people3. Halve, between 1990 and 2015, the proportion of people who suffer from hunger

OUTCOME 9 A Responsive, accountable, effective and efficient local government system

Output 2: Improve access to basic services

Output 4: Actions supportive of human settlement outcomes

Output 3: Implement the community work programme and cooperatives

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MDG 1 Progress to date - Eradicate extreme poverty and hunger

• According to the 2010 report, absolute poverty has declined• There is a five-fold increase in the number of people benefiting from social grants • There is a variety of pro-poor investments in services such as sanitation, water and

housing

Source: South Africa MDG Report 2010

Goal 1: Eradicate extreme poverty and hunger 1994 2010 2015 Achievability

Proportion of population below $1 (PPP) per day 11.3 5.0 5.7 Achieved

EPoverty gap ratio $1(PPP) per day 3.2 1.1 1.6 Achieved

Share of poorest quintile in national consumption 2.9 2.8 5.8 Unlikely

Percentage growth rate of GDP per person employed 4.7 1.9 6.0 Possible

Employment-to-population ratio 41.5 42.5 50-70 Unlikely

Proportion of employed people living below $1 (PPP) per day 5.2 ND =0 Unlikely

Proportion of own-account and contributing family workers in total

employment 11 9.9 =5 Possible

Prevalence of underweight children under-five years of age (as a

percentage) 9.3 10.2 4.7 Unlikely

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Progress with the Community Work Programme (CWP)

• Aims to provide an employment safety net, by providing a minimum level of regular work opportunities to participants, with a predictable number of days of work provided per month

• Currently provides 2 days of work a week; 8 days a month; 100 days a year per participant

• Wage rate of R60.00 per day

• Annual target for 2010/2011 was 87 000 work opportunities created by 31 March 2011

• Target for the MTEF period up to 2013/14 is 237 000

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During April 2010 to March 2011, the CWP achieved the following key performance targets:

• 89, 689 participants worked in the programme (regardless of the number of days they participated due to attrition, absenteeism and drop-outs);

• 56 sites are established;

• The CWP has created 23, 693 full time equivalent jobs (230 days worked); and 54, 494 jobs based on the poverty measure of 100 day opportunities; and

• The current CWP wage (including the supervisor supplement):

– non-wage ratio is 68:32. The ratio is higher than the targeted labour intensity ratio of 65:35 because the wage rate increased by 20% in November 2010 and the non-wage costs did not increase accordingly.

During April 2010 to March 2011, the CWP achieved the following key performance targets:

• 89, 689 participants worked in the programme (regardless of the number of days they participated due to attrition, absenteeism and drop-outs);

• 56 sites are established;

• The CWP has created 23, 693 full time equivalent jobs (230 days worked); and 54, 494 jobs based on the poverty measure of 100 day opportunities; and

• The current CWP wage (including the supervisor supplement): – non-wage ratio is 68:32. The ratio is higher than the targeted labour intensity ratio of 65:35 because the wage rate increased by 20% in November 2010 and the non-wage costs did not increase accordingly.

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Observations on Poverty Reduction• Globally, poverty rates have fallen from 46% in 1990 to 27% in 2005 in developing regions.

Achievements have mainly been in East Asia. In Sub-Saharan Africa, the poverty rate has declined slightly from 58% to 51% between 1990 and 2005.

• In South Africa there has been a decline in absolute poverty; the proportion of people who live below the poverty line has decreased from 53% in 1995 to 48% in 2008 (NPC, 2011), this is however still very high. Other notable achievements:

– Overall economic growth during the period– Introduction of expansive social grants (2.6m people in 1997 to 14.1m people in 2010) – Pro-poor investments in services such as sanitation, housing and others

• Relative inequality remains high (Gini Coefficient) due to:– High unemployment rate (around 25%)– High dependency ratio– Low labour force participation rate

• Globally, deterioration in the labour market, triggered by the economic crisis has resulted in a decline in employment Prior to the crisis, the depth of poverty had diminished in almost every region (United Nations 2010).

• In South Africa the National Planning Commission notes that “ The economic crisis has also had a negative effect on growth and employment, poverty reduction, and public finances. It will take some time before employment, growth and investment rise to pre crises levels especially as global economy remains weak and fraught with risk” (NPC Report on 2010 Indicators)

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Nine key challenges stand in the way of eliminating poverty and reducing inequality

– Too few South Africans work– The quality of school education for most black people is sub-standard– Poorly located and inadequate infrastructure limits social inclusion and faster

economic growth– Spatial challenges continue to marginalise the poor– South Africa’s growth path is highly resource-intensive and hence

unsustainable– The ailing public health system confronts a massive disease burden– The performance of the public service is uneven– Corruption undermines state legitimacy and service delivery– South Africa remains a divided society

• Tackling these challenges will require the involvement of all South Africans and coordination and cooperation across society and government

Source- National Planning Commission, 9 June 2011

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• The South Africa MDG Report recommends that ....“Municipalities should focus on Local Economic Development (LEDs) initiatives that are skills creating, employment generating and domestic production and consumption promoting...”

• With the introduction of the New Growth Path, DCoG plans to upscale its Local Economic Development initiatives towards the creation of sustainable jobs on a large scale.

• The approach will be to promote and support private sector driven catalytic business ventures and programmes, that have the potential to create job opportunities on a large scale.

• The South Africa MDG Report recommends that ....“Municipalities should focus on Local Economic Development (LEDs) initiatives that are skills creating, employment generating and domestic production and consumption promoting...”

• With the introduction of the New Growth Path, DCoG plans to upscale its Local Economic Development initiatives towards the creation of sustainable jobs on a large scale.

• The approach will be to promote and support private sector driven catalytic business ventures and programmes, that have the potential to create job opportunities on a large scale.

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• Government has focused on prioritising people's and the country's natural assets. • From April 1994 - March 2005, 2.4m housing subsidies were approved and 1.74m were built• SA’s dependence on environmentally harmful coal based energy production weighs against it

in delivering on the MDGs• However, the UN notes that there have been significant improvements in improving access

to basic services • Sustained investments in strengthening environmental monitoring systems remains essential

• Government has focused on prioritising people's and the country's natural assets. • From April 1994 - March 2005, 2.4m housing subsidies were approved and 1.74m were built• SA’s dependence on environmentally harmful coal based energy production weighs against it in delivering on the MDGs• However, the UN notes that there have been significant improvements in improving access to basic services • Sustained investments in strengthening environmental monitoring systems remains essential

Goal 7: Ensure environmental sustainability 1994 2010 2015 Achievability

CO2 emissions (kg per PPP $ of GDP) 1.29 0.98 1.3 Likely

CO2 emissions (metric tons per capita) 8.86 8.82 8.4 Possible

Forest area (% of land area) nd 0.41 nt Possible

Improved sanitation facilities (% of population with access) 58.5 72.2 79.2 Likely

Improved water source (% of population with access) 61.1 92.4 81 Achieved

Marine protected areas, (% of surface area) 0 6.54 14 Possible

Nationally protected areas (% of total land area) 5.18 6.20 9 Possible

Source: South Africa MDG Report 2010

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Project Performance indicators

Estimated performance 2010/11

Medium-Term Targets 2011/12

2012/13

2013/14

1. Supporting the building and upgrading of substations

Number of substations built and upgraded

10 20 30 40

2. Supporting the upgrading of electricity bulk infrastructure

MV lines built 375km MV lines built

365 km MV lines built

40km MV lines built

400km MV lines built

3. Supporting the upgrading of electricity reticulation infrastructure

% of households with access to electricity supply

85% 87% 90% 92%

4. Supporting the distribution of basic waters services to households

% of households with access to basic water services

93% 96% 98% 100%

5. Facilitate access to basic level of sanitation

% of households with access to basic level of sanitation

81% 88% 95% 100%

6. Facilitate access to basic services funded by the municipal infrastructure grant

Total number of households reached with basic services funded by the municipal infrastructure grant: water.sanitation.roads.community lighting

1.4 million 808 070 1.1 million 540 186

1.6million 929 070 1.3 million 616 186

1.8 million 1.1million 1486 million 692 168

2 million 1.2 million 1.7 million 768 150

7. Support implementation of refuse and waste management plan

Number of municipalities implementing the plans

0 50 150 278

8. Facilitate access to basic refuse removal services

%household with access to basic refuse removal services

62% 66% 70% 75%

9. Operation Clean Cities and Towns Programme

Number of cities and towns implementing the programme

2 8 8 16

CoGTA’s Annual Performance Plan for the MTEF – achieving the MDG Goals to be reached by 2014

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Challenges that stand in the way of infrastructure development

• Development is being held back by too little investment in new infrastructure, and a failure to maintain existing infrastructure

• Modernising infrastructure is complex, involving high costs while also helping shift towards a more labour-absorbing, knowledge-intensive economy

• Big distances within SA and between SA and our trading partners add to costs, given weak African infrastructure networks

• Thus SA needs a highly efficient logistics system, requiring more investment (including private money) and a political understanding of the need for super-efficiency

• We need a level of coordination within government and amongst SOEs that we’ve not achieved to date

Source- National Planning Commission, 9 June 2011

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MDG 8 - Progress to date on development of a global partnership for development

• In 2004, the South African Government undertook to halve poverty and unemployment by 2014. The economy grew at an average of 3.2% between 2005 and 2009, and thus growth targets have not been met

• South Africa is seen as a country characterised by a remarkably stable macro-economic framework. Its major challenge is to increase its economic growth potential

• South Africa has made great progress in telecommunications for the masses - rapidly approaching 9 out of 10

• Poverty and inequality are largely driven by high unemployment. Real per capita income has increased by 2% p.a. since 2001. At this rate, it would take South Africa about 35 years to reach Poland’s income level

• The proportion of people below the poverty line has dropped from 53% in 1995 to 48% in 2008, but is still a very high share of income for the poorest 40% has remained stable since 1994 –but now comes from social grants, rather than income and remittanceGoal 8: Develop a global partnership for development 1994 2010 2015 Achievability

Debt to GNI ratio 44.4 28.4 <44.4 Achieved

FDI inflows as % of GDP 8.4 1.4 >0 Possible

Internet users (per 100 people) 7.2 8.9 >50 Possible

Mobile cellular subscriptions (per 100 people) 18.5 85.9 >50 Achieved

Telephone (fixed) lines (per 100 people) 11.1 9.7 >50 Unlikely

Source: South Africa MDG Report 2010

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Lessons learned

National ownership of development strategies by lead departments is vital to ensure national commitment to development goalsSustained and equitable growth is significant in the reduction of poverty, which requires sustained and equitable growth based on dynamic economic changeMacroeconomic policies – these policies should not focus narrowly on debt stabilisation and curbing inflation, but should ultimately be supportive of growth of real output and employmentSocial Services – social development should be considered broadly to include: support for smallholder agriculture, nutrition programmes, school meals, access to primary health and education, access to safe water and sanitation, and support for indigent, disabled and otherwise impoverished householdsSocial exclusion and inequality limit contribution of growth to the MDGs, such as access to social services, social protection and economic opportunitiesCommunity-led strategies have proven to be effective  Monitoring by development partners and stakeholders is crucial for ensuring accountability and for the timely intervention in programmes and policies

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Recommendationsa) MDGs are achievable with the right policies, adequate levels of investment, and international

support

b) Creating the policy and fiscal space to accelerate and sustain progress and the generation of decent work is vital

c) Key public services and long-term public investments in infrastructure, agriculture and human skills are also pivotal

d) Government must have effective and innovative measures and partnerships to raise revenue and to efficiently allocate these resources for development

e) Innovative financing models are also required to fast track infrastructure development and to meet the 2014 targets

f) Harnessing private sector potential for sustainable development are required

g) Climate change – high growth pathways to meet development and climate challenges is both necessary and feasible. As the Department responsible for supporting energy development, CoGTA will push the green agenda and provide support to the Department of Energy and Eskom in reducing the country’s carbon footprint

h) Addressing special needs of the vulnerable – CoGTA will assist citizens of poor households, rural areas, slums and other disadvantaged groups to access basic services

i) Promotion of programmes such as employment-intensive initiatives, small and medium-sized enterprise (SMMEs), employment guarantee schemes, technical training, entrepreneurial skills development must be forged to reduce poverty

j) Expanding and strengthening partnerships to improve aid is required.