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Cape Town - President Jacob Zuma's maiden state of the nation address recognised the limitations a recession places on government's promise to scale up delivery.
But he said with prudent planning, government would forge ahead with its R787bn infrastructure spending plans and at the same time take steps to mitigate the effects of the economic decline on the country's most vulnerable people and businesses.
"In the face of the economic downturn, we will have to act prudently - no wastage, no roll-overs of funds - every cent must be spent wisely and fruitfully," said Zuma. "The economic downturn will affect the pace at which our country is able to address the social and economic challenges it faces. But it will not alter the direction of our development."
Zuma detailed several strategies to counter the recession.
These include a government job creation programme (phase two of the extended public works programme) designed to create half a million jobs by the end of 2009 as well as agreements with business to protect jobs.
Immediate support for business will come in the form of a scaled-up industrial policy plan, funds for those in financial distress and plans to reduce the cost of doing business.
Zuma called on business to work with government in a national effort to moderate the effects the recession.
This includes a strategy to keep retrenchment candidates employed by reskilling them. Details have not yet been finalised.
"We will also ensure that government buys more goods and services locally, without undermining our global competitiveness or pushing up costs beyond acceptable levels," he added.
The industrial policy action plan is to be scaled up, he said. In addition to lead sectors already identified (automobiles, chemicals, metals, tourism, clothing and textiles and forestry), the president said that services, light manufacturing and construction are to receive attention in the quest to create decent jobs.
Aside from a firm commitment to accelerate black economic empowerment, he said the creation of decent work would be the cornerstone of all policies.
Signalling a shift in the way in which social grants are offered, Zuma said that government was "mindful" of the need to link social grants to jobs, or economic activity, to encourage self-reliance among the able-bodied.
- Fin24.com
