International Labour Organisation 12th Regional Seminar

In Association with the Department of Public Works

M&G Profile
For Publication: 1 October 2007

Prioritising Employment Creation in Government Policies,

Programmes and Investments
Durban Convention Centre
8 – 12 October 2007

Background to the Seminar

The bi-annual International Labour Organisation’s Regional Seminar for Labour-Based Practitioners will
this year be hosted by South Africa at the Durban Convention Centre between 8 and 12 October. Entitled
“Prioritising Employment Creation in Government Policies, Programmes and Investments”, the seminar
will focus in particular on the role that employment-intensive infrastructure projects have to play in the
urgent task of alleviating poverty and unemployment in Africa.

The forum will provide African countries with the opportunity of sharing their experiences of labour
utilisation on infrastructure projects, as well as of learning from successful infrastructure-based work
creation models in use both on the continent and in other developing countries. It will also provide
delegates with the opportunity of reviewing the objectives set at the last seminar, which was held in
Mombasa, and of assessing progress in implementation. Papers will be delivered by the foremost
specialists in the development field, and workshop sessions will enable delegates to discuss these papers
and their implications for their own countries.

The South African Department of Public Works will specifically be reporting back on the progress of its
Expanded Public Works Programme (EPWP), which developed out of the Growth and Development
Summit (GDS) held in this country in 2003. The project, which was launched in 2004 by then-Minister of
Public Works, Stella Sicgau, set the ambitious goal of creating a million work opportunities for unemployed
individuals and marginalized groups over the next five years.

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Department of Public Works Chief Director: Employment-Intensive Special Projects, Maikel Lieuw-Kie-
Song, reports that, three years on, work creation goals set at the launch of the project are largely on track.
And, where there are shortfalls, these will be discussed at the seminar with a view to bringing them into
line with targets.

The R100 billion EPWP is the cornerstone of government’s poverty alleviation and work creation
programme, and is aligned not only to goals set at the GDS, but also to those set out in the African Union
Plan of Action for the Promotion of Employment and Alleviation of Poverty, adopted at the Third
Extraordinary Session on Employment and Poverty Alleviation in September 2004.

In terms of the plan, each member of the Union committed to reversing “the current trends of pervasive
and persistent poverty, unemployment and under-employment” on the African continent, and to improving
the general standard of living at individual, community and national level. Key priorities were identified as
the creation of an enabling political climate, the integration of social and economic policies, the extension
of social protection schemes, the improvement of human and institutional capacity, rural development, and
the empowerment of both women and vulnerable groups, such as people living with HIV / AIDS.

In line with this, the possible applicability for Africa of new developments such as the Employment
Guarantee Programme, which was launched in India last year, will be assessed. The programme aims to
provide a minimum level of employment per annum for all able-bodied people of employable age through
state-funded infrastructure development projects.

Employment-intensive programmes have historically proven to provide cost-effective and high-quality

solutions to the challenge of creating infrastructure in developing countries, and this year’s seminar will
further explore the effective use of this methodology for the benefit of all African nations and their people.

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South Africa’s Expanded Public Works Programme

In 1999, unemployment and poverty were identified as one of the most significant threats to South Africa’s
new democracy. At that time, approximately 40% of working-age people were unemployed, with a strong
weighting amongst the youth.

This situation, largely a legacy of apartheid policies, was further complicated by the social change taking
place at the time, by the country’s exposure to the effects of the rapid globalisation of capital that occurred
simultaneously with the advent of democracy, and by the fact that previous education practices had left
most working people either under skilled or unskilled.

The most important socio-economic challenge that faced government in the wake of the second
democratic elections was therefore fourfold: to reduce unemployment, to alleviate poverty, to strengthen
the general skills base, and to improve social services.

The subsequent launch of the Community-Based Public Works Programme went some way towards
addressing these issues. However, between 1999 and 2001, the programme only resulted in the creation
of between 13,000 and 33,000 new work opportunities per annum, accounting for a reduction of a minimal
0,5% in total unemployment labour days. According to analysts, this was largely due to limited budgetary
allocations, lack of capacity in both the public and private sectors, and the persistent problem of the skills
shortage.

Against this backdrop, government convened the Growth and Development Summit (GDS) of 2003, at
which it resolved that a R100 billion Expanded Public Works Programme (EPWP) would be established.
The programme itself was launched in September 2004 by then-Minister of Public Works, Stella Sicgau, in
line with government’s People’s Contract for a Better Future election campaign of that year.

Aimed at creating a million new work opportunities within a five-year period, the objective of the
programme is to ensure that significant numbers of unemployed people are drawn into productive work,
that they receive skills training while working, and that they are so enabled to become economically active
and productive members of society in the long-term.

The main focus of the programme is on the country’s youth, 70% of whom remain unemployed in 2007.
Women, rural workers and marginalized groups, such as people living with HIV / AIDS, also receive high
priority.

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Delivery is primarily through large employment-intensive infrastructure projects, such as the upgrading of
roads, pipelines and storm water drains. Where technically and economically feasible, and without
compromising end quality, labour is used in preference to machinery during construction, with the
objective of providing either temporary or contract-based employment, as well as skills development, to
local people.

Other delivery channels include the environmental, cultural, social and economic sectors, which
encompass such projects as the Department of Agriculture’s Land Care Programme, the Department of
Environmental Affairs and Tourism’s People and Parks initiative and the Department of Water Affair’s
Working for Water project. In the social sector, employment creation is through NGOs and CBOs,
particularly those providing early childhood development programmes and home-based care for people
living with AIDS. In the business sector, the spotlight falls on enabling and developing small, medium and
micro enterprises, and on supporting these through skills development, internship and learnership
programmes.

In terms of the EPWP, all nine provinces, as well as all parastatals, government departments and
municipalities involved in infrastructure provision, are tasked with taking steps to increase the levels of
employment on these projects whenever this is technically and economically feasible. Funding is provided
in the form of Municipal Infrastructure Grants, which are allocated by the Treasury on the basis of viable
implementation plans. R45 billion of the EPWP budget for 2004 to 2009 has been allocated to
infrastructure development, R15 billion of which has been allocated to employment-intensive construction.

The projects funded by the programme are largely for the development of simple infrastructure that is
particularly amenable to employment-intensive methods, and where the most additional work opportunities
can be created. There are huge backlogs in this type of infrastructure in historically-disadvantaged
communities, which is also where the need for employment is at its highest. The EPWP therefore aims to
foster both infrastructure development and employment at a local level, ensuring that workers are not
displaced from their communities by their need to work.

As far as infrastructural outputs are concerned, it is intended that over the initial five-year period, 37 000
km of roads will be developed, as will 31 000 km of pipelines, 1 500 km of storm water drains and 150km
of sidewalks. Further projects will include the maintenance of government buildings, and the creation of
electrification trenches under the auspices of Eskom.

Environmental programmes will, on the other hand, include the elimination of alien plant species on
approximately a million hectares of land and the improvement of 1 200 km of coastline, while economic
programmes will aim to create 400 sustainable small, medium and micro enterprises.

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Recognising, however, the inherent limitations in any Public Works programme, government sought early
on to partner with a suitable organisation that would be able to extend the EPWP’s reach and
effectiveness. During the planning phase, it therefore approached the Business Trust with a view to
providing support for the new EPWP. This resulted in the formation of the R100 million Business Trust
Expanded Public Works Support Programme (EPWSP), which is aimed at ensuring that beneficiaries of
the EPWP not only benefit from short- and medium-term work opportunities, but that they are also enabled
with long-term marketable skills.

Business Trust is a strategy-driven public / private sector initiative focused on taking practical action to
reduce unemployment, combat poverty, support priority growth sectors and increase capacity throughout
South Africa. The Trust mobilises resources from companies operating in the country to support initiatives
designed to accelerate the achievement of agreed national objectives. Since its establishment in 1999,
over 140 companies have committed more than R1,2 billion to this goal.

According to Seguna Gordhun, Business Trust COO, the programme’s primary purpose is to support the
EPWP in order to alleviate the deep and enduring level of poverty and unemployment in South Africa.

The problem, says Ms Gordhun, cannot be underestimated. Over 8 million people are currently
unemployed in South Africa, 59% of whom have never had the opportunity of working before. In the 16 to
34 age category, defined as “youth” by the Youth Commission, the situation is even more dire - a
staggering 70% have never been able to find work.

In a concerted effort to address this problem, the EPWSP has now partnered with 45 municipalities across
the country in order to support the government programme with business-specific skills and provide
technical assistance. This accounts for approximately 80% of the infrastructure budget at municipal level.

With two years remaining of EPWP’s initial five-year period, South Africa will be seeking to review policy,
goals and progress at the upcoming seminar. On-going strategy development and implementation
evaluation will be firmly on the agenda, as will a review of the policy framework within which the EPWP
operates. The seminar will also see a shift from the promotion of simple employment-intensive solutions to
the potential offered by foreign and public service sector investments.

The goal of full and productive employment, and of decent work for all, will receive specific attention.
India’s recently-launched Employment Guarantee Programme, for instance, may have salutary lessons to
offer for the countries of Africa. According to Maikel Lieuw-Kie-Song, the programme guarantees every
Indian household a minimum of 100 days of work at minimum wage level every year, so addressing the
issues of unemployment, infrastructure development and social security in one bold integrated initiative,
and providing unemployed people with the dignity of work.

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The South African government and, in particular, the Department of Public Works, is particularly interested
in learning from the methodologies developed as part of this programme, with a view to assessing the
viability of a similar programme for this country.

ends.
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