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Reflections on poverty and inequality in South Africa: Policy considerations in an emerging democracy

Jean D. Triegaardt

DBSA Applied Development Research Unit (ADRU)

18-20 September 2006

SARPN acknowledges the Development Bank of Southern Africa as the source of this document: www.dbsa.org
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Abstract

Since the advent of the new democratic dispensation, the South African government has developed policies which have focused on poverty alleviation. The social security system has been expanded over the past few years, particularly to children and the disability sectors. However, the social security system may become unsustainable in the future. Van der Berg, Burger, Burger, Louw & Yu (2005) suggest that social assistance is nearing the boundaries of its ability to alleviate poverty.

Given all the gains that have been made, South Africa still remains one of the highest in the world in terms of income inequality (World Bank Report, 2006). Inequality is also demonstrated through lack of access to natural resources; a two-tiered educational system; a dual health system; and other socio-economic dimensions. This increasing inequality is an issue of concern to policy makers and social scientists.

The purpose of this paper is to analyse the nature and dimensions of poverty and inequality, focusing on the gains that have been made, but identifying the gaps that remain. In addition, policy options, consequences and recommendations will be entertained.

Introduction

Poverty and inequality have co-existed for generations both in developed and developing nations, and in spite of the multiple interventions, the progress in eliminating this problem remains elusive. Many writers have referred to the impact of globalisation and its concomitant and deleterious effects on nation's labour markets and dismantling the welfare state (Dominelli, 2004; Mishra, 1999). In many of the developed nations, welfare has become residualised through the restrictions of benefits which have contributed to the intensification of poverty, and the further exclusion and marginalization of groups.

Since the genesis of the democratic dispensation, the South African government has developed policies which have focused on poverty alleviation, improving economic growth, relaxing import controls and reducing the budget deficit. In spite of the pro-poor policies, South Africa still remains one of the highest in the world in terms of income inequality (World Bank Report, 2006). The social security system failed to provide income security for the majority of the unemployed, and thus the safety net is not all encompassing (Taylor, 2002; Samson, 2004). Economic policies are unable to resolve the issue that there are more work seekers than jobs. In failing to address structural unemployment, in spite of the democratic government's pro-poor policies, its Achilles heel is its lack of vision and direction in comprehensively tackling poverty and inequality as a consequence of unemployment.

The purpose of this paper is to examine the nature and dimensions of this inequality in conjunction to poverty and unemployment, focusing on the gains that have been made, but identifying the gaps that remain. In addition, policy options, consequences and recommendations will be entertained.

Paper presented at the annual Association of South African Social Work Education Institutions (ASASWEI) conference organised by University of Venda Department of Social Work.
18-20 September 2006.




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