[Opinion] Class inequality a growing concern in SA

Class and geography are often ignored as reasons for inequality in South Africa; it is often claimed that racism is often claimed to be the cause of the country’s socio-economic problems.  

The government routinely uses race as a proxy for disadvantage. The term ‘white monopoly capital’ became a popular explanation during Jacob Zuma’s term as president for the fact that the majority of black South Africans remain marginalised from the mainstream economy more than two decades after apartheid ended.  

And using race as a proxy for disadvantage is central to existing and draft government policies that are hostile both to business and investment, such as Broad-Based Black Economic Empowerment (BBBEE).  

However, there is growing evidence that the biggest issue facing South Africa is not racial inequality, but rather class and geographical inequality.

This becomes clear when looking at South Africa’s Gini coefficient over a 20-year period. The Gini coefficient is a global tool used to measure inequality. It assigns a score of 0 to indicate perfect equality and a score of 1 to signify absolute inequality.  Between 1996 and 2015, South Africa’s inequality rate increased from 0.61 to 0.63.  But this growth in inequality was not driven by inequality between white and black South Africans, but rather within the black population. 

Breaking down South Africa’s inequality by race shows that the Gini coefficient score for black people rose steadily from 0.53 in 1996 to 0.57 in 2015. This indicates an expansion of the black middle class and its growing access to high-quality education, healthcare and high-paying jobs. Yet the overall majority of black South Africans are still being left behind. 

This perfectly represents a growing problem of class inequality in South Africa. At the same time, inequality between provinces is also a growing concern, as noted by the Centre for Risk Analysis (CRA). The CRA recently released the latest Quality of Life Index (QOLI) which is used to benchmark South Africa’s progress in improving citizens’ quality of life.   

Weighted indicators 

The Index is based on ten weighted indicators that are indicative of the quality of life of a person or household. Each indicator has been calibrated as a score of between 0 and 10, with scores closer to 0 indicating poor performance and those closer to 10 showing better performance.  According to the index, the Western Cape is the province with the best quality of life with a score of 6.5, compared to a national average of 5.7. Gauteng is the second-best performing province with a score of 6.4.  Both the Eastern Cape and Mpumalanga are in last place – each with a score of 5.0. 

People in the Western Cape are four times more likely to spend more than R10 000 per month and twelve times more likely to service a bond than those in Limpopo. A quarter of people in Gauteng have medical aid coverage, compared to just a tenth of the populations of the Eastern Cape and Limpopo. 

Nearly two thirds (65%) of households in Mpumalanga have either irregular or no waste removal compared to just 6% in the Western Cape.  In the Eastern Cape the majority (53%) of people are unemployed – nearly twice the rate in the Western Cape. 

These figures and the overall QOLI scores show that where you live in South Africa will have a significant impact on your access to job opportunities and basic services.  Gauteng and the Western Cape emerge as the only two provinces where a relatively good standard of living can be achieved.  

The index further demonstrates that rural provinces in particular suffer from a lack of economic activity, job creation, and the provision of services such as waste removal and quality healthcare. 

Another study, titled ‘Reasons for Hope’ by the Institute of Race Relations (IRR), showed that the overall majority of South Africans believe job creation, better education and better delivery of electricity, water and sanitation services, are what people need to improve the quality of their lives, rather than racial policies such as BEE or land reform.  

Best tools

In the 2018 IRR field study, 59% of South Africans polled believed that more jobs and better education were needed to improve lives in the country. More than 70% of white South Africans and 57% of black South Africans believed that jobs and education were the best tools for improving living standards. A further 24% of black and white South Africans indicated that basic service delivery should be prioritised. Only 18% of black people and 9% of Whites thought that the country needed more emphasis on policies such as BEE and land reform.  

In addition, only 2% of black South Africans polled indicated that fighting racism should be the government’s top priority compared to the majority opinion that the government should rather focus on creating more jobs, fighting corruption and crime, and improving education. 

Intra-racial inequality is a growing trend, along with the clear urban/rural divide evident in the CRA’s QOLI scores. Both require attention, yet the Government invariably shifts the focus of national debate on to racial narratives to distract from their own policy failures over the last decade.  

One step that would help improve the quality of life for all is the removal of legislation such as BBBEE, which benefits only the politically connected and often leads to corrupt practices that have a negative impact on service delivery.  

Furthermore, economic reforms need to be introduced to help B-grade provinces compete with A-grade provinces such as the Western Cape and Gauteng. This will require removing government red-tape that hampers small businesses, improving the quality of education and implementing investment-friendly policies. Only then will quality of life improve for all. 

Photo: Johnny Miller for Impacter
Original article here.