DA proposes a Smart Lockdown Level 4 based on trust, transparency and freedom

South Africa needs a much wider opening of the economy than suggested by government’s Level 4 lockdown proposals. The DA has submitted our Level 4 proposals for how to open more of the economy without compromising public safety.

Government’s approach to specifying who can and cannot work in Level 4 is unnecessarily blunt and restrictive. Many businesses which could be operating without significantly increasing the spread of the virus will be forced to remain closed.

This will do unnecessary damage to jobs and tax revenue – and to public compliance and confidence in the system – and soon render government’s approach unsustainable.

The only condition for a business to operate should be that it has, or can achieve, an acceptably low potential for spreading the virus.

Obviously, Level 4 sets a higher bar for “acceptable” than would a lower level. Recall that the lockdown levels indicate the level of threat posed by the virus. The DA’s Smart Lockdown proposes that for each lockdown level, government should specify the requirements for a business to be able to operate. Businesses can then decide if they are willing or able to meet those. They may choose to invest in the required mitigation measures, for example arranging private transport for staff, buying protective equipment, temperature screening staff/customers on entrance.

This way, government is putting decision-making power in the hands of those people who know and care most about each individual business: its employers, employees and customers. This approach harnesses the creativity, incentives and goodwill of everyone, within a reasonable set of rules.

Instead, government seems intent on centralising draconian powers in the hands of incapable ministers. The result is arbitrary rules enforced by military deployment.

Military deployment and military-backed curfews to ensure compliance are a tacit admission by government that the rules are not reasonable and that people and businesses cannot be trusted to act in their own best interest.

Under government’s Level 4, for example, no hairdresser may legally operate and no one can get a haircut, no matter how many precautions they take to reduce the risk of transmission. Under the DA Smart Lockdown Level 4, a hairdresser could operate as soon as a reasonable set of safety measures is in place. These safety measures would be quite demanding, given that Level 4 indicates a high level of risk. But they would not be insurmountable.

If people and businesses are empowered with information about the risk that the virus poses to themselves and their community, and how that can be mitigated, most will play by a reasonable set of rules. Indeed, an HSRC survey indicated 99% compliance in the first weeks of lockdown.

An authoritarian approach made sense initially, but as time goes on decision-making power needs to become more dispersed, within a given set of justified rules. If rules are reasonable, people tend to follow them. And those who don’t will be kept in line through peer pressure and whistle-blowing.

Compliance requires a good reason for the rule. The fact is, government is imposing harsh rules backed by military force and requiring a massive sacrifice from people without having given us a comprehensive enough justification.

Right now 25% of South Africans do not have money for food. If Level 4 is much the same as Level 5, ultimately more people may suffer and die from lockdown than from Covid-19. Remember, we’re going into the marathon phase of our covid-response – our strategy for controlling the virus has to be sustainable over an 18-24 month timeframe.

Government is demanding enormous economic and civil liberty sacrifices but has yet to share with us the epidemiological assumptions and calculations underpinning SA’s response to this virus, let alone any district-specific detail on the case, testing, hospital capacity and other data that feed into a determination of lockdown levels.

The DA has submitted a request for transparency, supplying specific information that we think should be shared with people by way of published dashboards. Compliance will be much higher in a transparent environment where the rules are reasonable, justified, and aligned to people’s natural incentives.

An 8pm to 5am military curfew is none of these things. It demonstrates a lack of trust in the people of South Africa to take individual responsibility for their own safety. The DA has submitted our position on a military curfew.

Ultimately, more social freedom and a wider opening of the economy using a Smart Lockdown approach based on trust, transparency and individual empowerment is in South Africa’s best interest.

THE SPRINT AND THE MARATHON – WINNING THE BATTLE AGAINST COVID19

This battle requires a sprint and then a marathon. How we fare in the sprint determines how we fare in the marathon.

The sprint is to get our strategy, systems and infrastructure in place for the marathon. Most importantly, it is to ramp up the scale and speed of our testing capability so that we know exactly when and where the virus is flaring up in communities, so we can control it, rather than have it control us.

It has required a hard lockdown. No point in letting covid19 spread out of control until we’re ready to fight.

The marathon is to control the spread of Covid19 so that as many infected people as possible survive.

It will require a smart lockdown. Covid19 may be with us right up until a vaccination is widely administered in 18-24 months’ time. Treatment will hopefully come sooner. South Africa’s borders are porous, so there is no option for an “elimination” strategy such as New Zealand is pursuing. We are not an island.

The sprint must be as fast as possible because a hard lockdown is very expensive and we need to save some of our resources for the marathon. Hard lockdown costs SA an estimated R13 billion per day. An effective testing programme (testing to the scale and speed required to produce the same amount of control over the virus as the hard lockdown) will cost SA an estimated R5 billion per year. Even if that estimate is out by a factor of 3 so that testing costs SA R15 billion per year, it still equates to the cost of a single day of hard lockdown.

The marathon must be as smart as possible so that our resources don’t run out before we get to the finish line.

Smart lockdown

A “smart lockdown” means we keep control over the virus while still being able to allow as many people as possible to get back to work, so that we don’t run out of money before we get to the finish line.

We keep control over the virus by knowing exactly where it is springing up and how many new people are getting infected each day, and by knowing how many new daily infections our hospitals can cope with.

If we know this, then we know what level of lockdown we can operate at, and at what location. Localised lockdowns are obviously preferable, as they keep as few people out of work while still suppressing outbreaks.

“Smart lockdown” makes use of clear levels of lockdown and we move between them, depending on what the data is telling us about covid19. Perhaps:

Level 4 – Hard lockdown

Level 3 – Soft lockdown

Level 2 – Soft open

Level 1 – Open

Rather like how we move between stages of load-shedding or water restrictions according to how much electricity/water is available.

No point locking down too hard if the virus is spreading slowly and our hospitals are coping fine. More of us should then be back at work to earn the money (taxes) we need to get to the finish line.

No point locking down too soft and letting the virus spread out of control. If we lose control of the virus, it means we lose control of knowing what level of lockdown we should be operating on. In which case, we need to revert to hard lockdown to get the virus back under control again.

That’s why hard lockdown is an important level of smart lockdown.

Of course, staying at home isn’t the only way of controlling the spread of the virus. There are other ways of doing this. We can call these other ways “smart interventions” because they allow us to control the virus AND get more of us back to work. They are more of a targeted and less of a blanket approach than a hard lockdown. They are a key component of the smart lockdown strategy.

Smart Interventions

If we agree to all wear masks whenever we leave home, the virus will find it harder to spread.

If we agree that all public facilities – shops, taxis, busses, trains, banks, municipal offices – have spray-on hand sanitizer on entrance and exit, the virus will find it harder to spread.

If we agree on physical distancing protocols for when we aren’t at home, the virus will find it harder to spread. If we assist high-risk people – those over 65 and/or immune-compromised – to continue self-isolating, the virus will find it harder to spread. That way more of the rest of us can get back to work to support them. Remember, the younger we are and the stronger our immune systems are, the quicker our bodies kill the virus before it can spread any further. The older we are and the weaker our immune systems are, the more chance the virus can build up in our body and the more infectious we become.

If we boost our immune systems our bodies can fight the virus quicker and harder. So if we keep our stress levels low and get enough food and sleep, the virus will find it hard to spread. Right now, people are starting to stress more about their jobs and income than about this virus itself.

That’s why getting back to work is in a sense a Smart Intervention in itself. If we keep tight control over our border and test and isolate all those coming in, the virus will find it harder to spread.

If we test a large number of people every day for the virus, so that we identify and isolate the “explosions” of infection in our communities – through local lockdown – before they get properly under way, the virus will find it harder to spread. Professor Karim, chief advisor to SA Health Minister Zweli Mkhize, uses the analogy of small fires starting up in a forest. If we can locate them early on, we can target our fire-fighting resources at them and put them out before the fire rages out of control.

Of the “smart interventions”, testing has the greatest leverage. It’s the thing we absolutely have to get right. If we can get it right, it will justify this current hard lockdown.

Test, trace, track

Our ability to test effectively is pivotal to the success of a smart lockdown.

Other countries – South Korea, Taiwan, Germany, Kerala in India – that have best managed to control the spread of the virus attribute their success to an effective testing programme. Germany is testing at a level of 60 000 tests per day and still driving that number higher. The UK is aiming for 100 000 tests per day.

Once someone tests positive three things have to happen.

  1. They must be immediately isolated for at least 14 days so they don’t spread it further.
  2. Their contacts must be immediately traced to know who else they may already have infected, so we can test them too.
  3. We need to anonymously track their movements so we know where we need to focus our testing, in case they are not self-isolating.

This is a targeted testing approach. We only have so much testing capacity, so we test those people most likely to be positive.

But we also need to do randomised testing in communities, to make sure that there are no new “explosions” (hotspots) that we don’t yet know about. People can spread the virus without knowing about it, because they become infectious 4-7 days before symptoms appear.

The most important communities to do randomised testing in are those that find it very hard to lockdown. It is simply not possible for households to stay at home when they share facilities such as water points and toilets with other households. And when large families are crammed into small houses which themselves are crammed closely together.

A successful testing programme has a double benefit:

  1. It saves lives. Fewer people get the virus and our hospitals aren’t over-run.
  2. It saves lives. Enables data-driven decisions about what level of lockdown we can be on. So as many as possible of us can work while still having the virus under control. So we get as much tax revenue as possible to fund our health response – doctors, nurses, PPE (personal protective equipment), field hospitals, testing programme – right up until we get over the marathon’s finish line, which may still be 18-24 months away.

Treat

The greater the capacity of our hospitals, the more infected people will be able to get the treatment they need and the fewer will die from the virus.

South Africa must direct additional resources to strengthening our healthcare system over the coming months, to ensure optimal treatment for as many patients as possible – both those with Covid-19 and those with other serious illnesses.

But there’s a second reason that building health capacity is such a powerful intervention. The greater our health capacity, the higher the average number of new daily infections can be before we need to move to a higher lockdown level.

Virtuous circle

It should be clear now that the greater our testing and hospital capacity, the more of us can work, the more money (taxes) we have to fight the virus – including by growing our hospital capacity still further – and the less chance we run out of money before we get to the finish line.

It’s a virtuous circle, which is why it is a false choice to choose between saving lives and saving livelihoods.

The more lives we save, the more livelihoods we’ll be able to save.

The more livelihoods we save, the more lives we’ll be able to save.

A smart lockdown approach enables maximum coordination between our health and economic response. It is a highly data-driven approach.

Data

This is why it is so important that we have transparent, reliable, up-to-date information about the capacity of our hospitals – including any temporary field hospitals we set up. The government should ideally be publishing a daily dashboard for the public, showing test results and hospital capacity by area.

Sprint

So we are in a race against time to build testing capacity. At this point, no amount of money we throw at our testing programme would be too much.

We must be ready for mass virus testing before the end of April 2020. SA cannot extend the current hard lockdown on the same terms any further.

If the pressure is not released, there will be an explosion of non-compliance anyway. And we are fast running out of money. Our economy is underwater and running out of oxygen.

The bridge

We need to provide a “bridge” to assist poor people, struggling businesses and hospitals to survive this crisis and bounce back afterwards.

The sprint is to get them onto the bridge. The marathon is to get them over it.

The sprint – getting onto the bridge

Government needs to take a “helicopter drop” approach to giving relief to poor people and struggling businesses to help them survive this lockdown. This means rapid, generalised, direct cash transfers, to “bridge” poor people and struggling businesses to the other side.

The DA suggests R50 billion of cash transfers to poor people over the next three months by increasing every type of social grant by R1000 per month. If this is done in conjunction with a phased opening up of the economy wherever possible, this expense will ultimately be budget neutral, due to the multiplier effect. In other words, if government directs cash as quickly as possible to as many poor people as possible, they will get that R50 billion back as tax revenue once it has worked its way through the economy.

The DA suggests R50 billion in direct business support in the form of low-interest loans to any business, repayment of which need only commence after 12 months.

We suggest that the TERS (temporary employment relief scheme which assists businesses with their wage bills) should be administered by SARS rather than the UIF. SARS is best-placed and has the capacity to make more rapid, generalised cash transfers to business than does the UIF.

Government also needs to ramp up the health budget, to get hospitals onto the bridge. The DA suggests allocating an additional R50 billion to healthcare-related costs.

This sprint part of “bridging” requires a fiscal response – we need to reprioritise our budget to get this right.

The marathon part of “bridging” requires a policy response. We need to reform our economy to get this right.

The marathon – getting over the bridge

We make electricity more affordable and more reliable for people and businesses. We do that by opening our energy market. All independent producers should be able to produce and sell electricity.

We make data more affordable for people and businesses by auctioning spectrum.

We make investing in SA more attractive by walking away from investment-killing policies like EWC, BEE, NHI, asset prescription, and SARB nationalization.

Smart lockdown

All these interventions are part of what the DA has called a “Smart Lockdown” strategy. This strategy is completely within South Africa’s capacity to implement. It gives us the best chance of winning the battle against Covid-19.

STRAIGHT TALK: To defeat coronavirus, South Africa needs to rise above populist binaries

South Africa cannot recover from the coronavirus crisis if we view mitigation efforts as a trade-off between lives and livelihoods. Unfortunately, over the past few days, we have heard arguments starting to emanate from certain quarters that our country faces a zero-sum trade-off. For these commentators, we can either save lives, or we can save livelihoods, but we cannot do both.

This is a profoundly dangerous sentiment. As a group of eminent academics wrote last week, “Economic policy has health consequences. And health policy has economic consequences. The two need to be seen as parts of a coherent whole.”

This is exactly the approach of the Democratic Alliance (DA). Rather than a zero-sum game, we recognize that the solution to this crisis is a positive-sum game.

This means that we can only avert the worst of the human suffering caused by Covid-19 if we make sure that our economy generates sufficient economic activity to fund hospitals and the health response, and to ensure that people have enough money to feed their families, to purchase medicine, and to have a roof over their heads. At the same time, we can only avert an economic depression and the deaths that will follow in its wake if we make sure that our healthcare response to the coronavirus saves as many lives as possible, as quickly as possible.

The reality is that destitution is just as vicious a killer as the coronavirus. We need to protect human lives from both of these killers.

Unfortunately, over a period of many years, South Africans have gotten used to a type of politics that thrives on divisive binaries. We are used to hearing political leaders pitting people from different communities, races, genders, languages, cultures and backgrounds against each other. Too many in our society have gorged themselves on zero-sum politics, where “our people” are pitted against everyone else.

As a result, it is perhaps not surprising that so many people have defaulted to a simple zero-sum binary framing of the coronavirus crisis. As we have done so many times before in our history, too many South Africans are busy dividing themselves into laagers, based on an assumption that one can either be for saving lives but happy to sacrifice the economy, or one wants to protect economic output while sacrificing human lives, but that one certainly cannot be in favour of saving both lives and livelihoods.

In turn, the false binary between saving lives or livelihoods has bred a second, equally dangerous binary, namely that we can either have the current hard lockdown to the near-total exclusion of all economic activity, or we can have unfettered economic activity without any lockdown measures in place. Just like the binary between saving lives and livelihoods, this too is a false zero-sum choice.

Framing our society as a series of zero-sum choices has always helped strengthen populist politicians and demagogues at the expense of South African citizens. But if we apply the same tired zero-sum politics to the coronavirus response by framing it as a choice between lives and livelihoods, and between a total lockdown and no lockdown, we will unleash a wave of suffering on this country unlike anything that has come before.

More urgently than ever before, South Africa needs to rise above the kind of zero-sum politics that we are unfortunately so used to. Instead, we need to embrace complexity by understanding that our very viability as a country depends on protecting lives from the coronavirus, and protecting lives from hunger and destitution. And we need to recognize that we can only defeat this virus if we all work together to make the right decisions based on sound and publicly available data.

In practical terms, this means that we need to continually strike a fine balance between measures to contain the spread of the coronavirus, and sustaining sufficient economic activity to fund the health response and protect people from destitution.

Once we’ve dispelled the first false binary between lives and livelihoods, we will recognize that the next logical question is not whether we need a hard lockdown or no lockdown. Instead, the right question to ask is what kind of lockdown is most appropriate, at any given moment, for saving both lives and livelihoods.

That is why the DA is in favour of smart lockdown model, which outlines different lockdown stages similar to the water restrictions and loadshedding schedules that we are all so used to. Based on the input of data like the rate of transmission and the number of people in need of hospitalisation, the smart lockdown model will give us the flexibility we need to tighten and loosen restrictions as the crisis evolves.

The government made the right initial call by responding quickly once the virus reached our shores. However, in the context of a rapidly evolving pandemic, what was the right balance two weeks ago is not necessarily the right balance today or tomorrow.

Extending the hard lockdown on nearly all economic activity beyond 16 April without also publicly sharing the data upon which this decision is based, risks unleashing economic and social devastation that can be avoided with a smart lockdown, which allows us to open some sectors now while continuing to enforce strict requirements like mask wearing and protecting vulnerable groups like elderly citizens.

With a smart lockdown, where decisions are based on publicly available data, citizens will also be able to understand how the situation is evolving and why there may be a need to tighten or loosen lockdown restrictions as the situation evolves.

Societies that reject zero-sum binaries are the ones that will survive this crisis and one day thrive again. For South Africa to be one of them, we urgently need to rise above the tired zero-sum dichotomies upon which so much of our politics and society is based. Like the Covid-19 disease itself, getting the balance right by embracing positive-sum solutions that protects lives from both the coronavirus and destitution under a smart lockdown model, is a matter of life and death for our country.

STRAIGHT TALK: Economic reform is now urgent to save lives and livelihoods

South Africa is in an extremely vulnerable situation. A “heavy and devastating storm” – to quote Health Minister Zweli Mkhize on the pandemic – is approaching and, simultaneously, our economy is collapsing.

It has been dealt a triple blow recently, with the massive run on our bonds, our country going into lockdown, and our credit rating being junked.

The immediate result of these will be a sudden drop in tax revenue coupled with a steep rise in the cost of borrowing. Having managed our economy extraordinarily badly over the past twelve years, dithering over the reforms we know we need to implement, we now find our cupboard bare at precisely the time when we need to ramp up spending considerably to save lives and livelihoods during and after this pandemic.

This is not just a problem in the short-term. The risk of long-term economic decline – a shrinking economy and runaway debt – and massive social instability has also intensified strongly. That puts lives at risk from threats other than the Coronavirus – threats such as falling healthcare and social grant budgets, malnutrition, starvation, growing unemployment and increased violent crime.

Minister Mkhize this week prevailed on provincial health departments to use this short grace period – the calm before the storm – to “move with speed” to prepare for the coming onslaught of cases of infection.

Similarly, there can be no dithering on the economic side. We need swift action to assist households and businesses in distress. This should be through existing mechanisms such as the social grant, VAT repayment and banking systems. SARB, the Treasury, and banks need to play a leading role. The government must put ideology aside and seek as much financial assistance as possible from the International Monetary Fund (IMF).

This must be coupled with swift, bold reform focused on implementation – both to mitigate the damage during this pandemic, and to enable our society and economy to recover as fast as possible once it has passed.

Economic reform has always been a matter of life and death. But this Coronavirus has amplified the trade-offs involved. Trade union bosses will find it much harder to justify putting their vested interests ahead of the common good. Statists will find it harder to justify propping up failing state-owned entities.

The cost of above-inflation pay increases to non-frontline public servants is the lives and livelihoods that will be lost by not directing the billions saved to the healthcare, social welfare and small business sectors instead.

Not only that, but it could also cost us a loan from the IMF, since that institution will be reluctant to assist a country so drunk on patronage, especially when the queue for loans is so long and clamouring.

For exactly the same reasons, SAA should be closed immediately and the assets sold off when possible. There is no justification for spending the budgeted R16 billion to keep it going (subsidising public transport for the wealthy) when this money could rather be spent on saving lives and livelihoods. Unbelievably, this budget decision was coupled with a reduction of R3.9 billion in the healthcare budget. This is simply untenable.

The rank unfairness and irrationality of this trade-off decision is now clear for all to see. In fact, we must put an immediate stop to all further bailouts of failing state-owned enterprises. To protect unproductive jobs at the expense of people’s lives and the productive, value-creating economy at a time like this is unconscionable.

Nor can we justify delaying opening our energy market to full competition from independent producers. This will make electricity cheaper and more reliable, taking considerable pressure off households and businesses in the coming months and years.

Likewise, reforms to our rigid labour legislation are now urgent. Small businesses need maximum flexibility and freedom to adapt and survive in rapidly changing circumstances. Otherwise they are left with a straight choice between breaking the law and going bankrupt. It is in no-one’s interest that successful small businesses die during or because of this sudden-stop economic period.

President Ramaphosa has acknowledged the urgency of reform, saying to Finance Minister Mboweni on Monday: “We now need to move boldly on the structural reforms programme.”

If he does not follow words with action, history will judge him harshly. He may not have the full support of this own party, but he has strong cross-party support to push reforms through parliament. Never has the need for a political realignment been more urgent.

Nor the need for a capable state move evident. Perhaps the most important reform of all is to start appointing people to positions of leadership based on their ability to get the job done in the best interest of the general public. It beggars belief that someone as incompetent as Fikile Mbalula is our Minister of Transport.

If this moment of heightened risk and danger gets us to appoint better leaders, fix the fundamentals, and make better trade-off decisions, some good may yet come from this terrible, deadly pandemic.

The most immediate and looming trade-off decision the President will have to make is between an extended lockdown and economic activity. This will require great political courage, since the easier political choice will be to err on the side of avoiding deaths due directly to Covid-19, even at the expense of many more deaths due indirectly to the measures taken to suppress it.

South Africa would have had more room for manoeuvre had we made better decisions in the past. But this is no time for looking backwards. Now is the time to accept current realities and act swiftly to save lives and livelihoods.

STRAIGHT TALK: Coronavirus: Stick to the plan.

At midnight tonight, we go into lockdown. This is a first in our nation’s history. We’re in uncharted territory.

Our situation is surreal. In a matter of weeks, the ordinary and predictable has given way to the extraordinary and unprecedented. Never in the history of our nation have we had to take such massive decisions in so short a time with so many unknowns against such invisible yet deadly a threat.

And yet we have a plan. And it is a good one if we all, or at least the vast majority of us, get on board.

There are still so many unanswered questions, but we know the most important thing about this virus: it cannot survive if it cannot spread.

And that is the essence of our plan: to act now, together in unison, to stay physically apart from other households to break the chains of infection.

In this moment of great need, President Ramaphosa has produced a bold, credible plan. This 21-day lockdown may appear to some to be “overkill”, but it is based on the premise that the sooner we act to suppress this virus the better, and that strong measures today for a limited, doable amount of time will save millions of lives and possibly even millions of rands down the line.

The strategy is to fight it hard now while it is still in its infancy, and get the better of it before it gets the better of us. Even if we don’t manage to stamp out this virus completely with this lockdown, we buy ourselves precious time. The world has never learned as fast about any other disease, ever. Humanity will know a lot more about this virus in three weeks’ time than it does now.

You may disagree with it, but the time for debate about our overall strategy is over. We have a plan and now it’s down to the implementation.

Make no mistake. This plan comes at a massive, immediate socioeconomic cost. Which is all the more reason that we cannot afford to fail on implementation.

Every single one of us has a role to play. While many of us may feel powerless in the face of this emerging threat, in fact every one of us has the power to break possible chains of infection. And not only the power but the civic duty and legal imperative to do so.

This virus will not survive if we deny it new hosts.

No one could have guessed we’d be called to go into battle barefoot and in dressing gowns, and yet that is what is being asked of most of us now. Stay at home. Our most powerful weapons in this fight are patience, cooperation, self-discipline – and soap. We all need to rise to the challenge of deploying these liberally.

This is a temporary break in our freedoms, not a permanent one.

For the millions of South Africans living in cramped conditions, giving up those freedoms will be an extraordinary challenge and sacrifice. Others are lucky to have more spacious homes. We should all try to find the opportunity in this. This can be a chance to read the books we’ve been meaning to read, watch the films we’ve been meaning to watch, clear out the unused stuff in our cupboards, get our affairs in order, sleep, start a programme of morning push-ups or stretching.

For parents, this is a chance to spend time with our children, to take the time to play games with them, read to them, really listen to them.

This is an extraordinary time calling for extraordinary kindness, compassion, forbearance, patience. For slowing down. For thinking of all those we know and helping them to the other side in any way we can.

Our economic activity does not have to come to a complete stop. Much work can be done and some services can be delivered remotely. This is an opportunity to learn new ways of doing things. Ways that may turn out to be much easier on ourselves and the living world on which our lives ultimately depend. Hopefully we will emerge from this crisis more resilient and more united than before. Never has it been more apparent that we need to cooperate and work together, even as we stay physically apart.

Now more than ever we need clear, unambiguous communication from government. I have written to President Ramaphosa suggesting he convenes a daily press conference where he addresses the nation and answers questions, as we have seen in other countries. This will go a long way to providing clarity and stability in a time of great distress and confusion.

Everyone will have their opinions. But our democratically elected head of state has delivered us a plan that can work if we stick to it. This is the most important message to take away as we go into lockdown: stick to the plan.

STRAIGHT TALK: Mitigating the economic fallout from Coronavirus

Covid-19 will deliver a massive, sudden and potentially deadly blow to many businesses in our economy – indeed, this has already begun. This has introduced an unprecedented challenge at a time when our economy was already in recession. The damage can and must be mitigated.

Government now needs to do everything it can to assist as many businesses as possible to survive this “sudden stop” situation so that they are still operating and can recover fully when the Coronavirus threat blows over in four to six months’ time, as it is generally expected to do.

On Sunday, President Ramaphosa showed decisive leadership in announcing a virus containment plan. He now needs to match that with a comprehensive economic support package that takes as much financial pressure as possible off businesses and households in the coming months.

Otherwise our national effort to limit the damage from Covid-19 will come at a terrible, perhaps even unjustifiable, economic cost. Small businesses will not survive and the households that rely on them will suffer enormously without support from government. The stringent curbs on restaurants for example, introduced on Wednesday, will be crippling to those in that sector.

Even in our stressed economic environment, there is much the government can do. The DA has made several suggestions.

Funds for disaster management and economic support can be freed up by cancelling the planned R16,4 billion bailout of SAA. It is surely unthinkable at a time like this to bail out failed SOEs while thousands of successful small businesses face ruin.

We need a nationwide loan forbearance programme giving a four-month payment “holiday” on loans for small and medium business, in particularly property, business and vehicle loans. Extending the term of loans by four months will allow borrowers to pause their payments over the next four months.

This will help small businesses maintain the cash flow necessary to stay open and keep paying their employees without the need for each business to negotiate with their banks individually. Many other countries, including China, France, the UK and Canada have taken a similar approach.

A loan payment “holiday” will enable rental payments to be paused for four months to help businesses survive. Those property owners who rely on the income from non-bonded properties should give rental reductions or extensions wherever possible, and government should encourage them to do so.

Small businesses would get immediate relief if the VAT threshold is raised from R1 million to R2 million. And any VAT refunds owed to small businesses should be repaid immediately.

Government has already adopted one of our proposals, which is to allow businesses to skip Unemployment Insurance Fund payments for the coming months and expand UIF coverage to better protect affected workers.

This should be extended to pause payments to the Worker’s Compensation Fund too, without affecting worker’s cover under the fund. Payments could be recovered when the economy bounces back.

Local governments that can must be encouraged to offer rate payment holidays over the next few months. Employers of domestic workers must be encouraged to continue paying their staff through these months if possible, even if they prefer staff to stay at home or if staff require more sick leave than is due to them.

Had government saved for a rainy day, this would have been the time to undertake massive government spending of the sort being undertaken now in the US and UK, where 12% and 15% of GDP respectively has been allocated for relief.

But as our economy is already in a debt trap, government has very little room for fiscal manoeuvre. Furthermore, we can expect tax revenues and growth to decline still further in the coming months. This makes a comprehensive economic support package of the sort outlined above all the more urgent.

As a country, we need to pull together to assist all households to weather this storm. Unrecoverable economic collapse is in no one’s best interest.

We are working hard to mitigate the impact of COVID-19 on the WC economy

Statement by the Western Cape government on COVID-19 interventions: 

The COVID-19 pandemic is a global health crisis and a major risk for the world economy that is inevitably having an impact on the economy in the Western Cape.

However, we remain committed to doing whatever we can to mitigate the impact of COVID-19 on the Western Cape economy and there is an enormous amount of work being done across government to ensure this.

Our economic response
The Premier, Alan Winde, has convened a Joint Operations Centre (JOC). The JOC has a number of workstreams, one of which is focused on mitigating the impact of COVID-19 on the provincial economy.

The economic workstream has met every day since it was established and is focused on supporting key sectors in the Western Cape, namely Conference & Events, Tourism and Travel, Agriculture, Exports, Manufacturing and the Services Sector, which includes Retail and Business Process Outsourcing.

Our strategy to support businesses in the Western Cape has three aspects:

  1. Containment – gathering information from industries to understand their business needs and respond to their needs
  2. Adaptation – collating and sharing best practice to help businesses adapt and become resilient, and
  3. Recovery – identifying actions that need to be taken to drive economic recovery once the pandemic has been contained, e.g. tourism and investment campaigns

Consulting business
This week, the economic workstream are consulting with business and industry stakeholders to understand and address the challenges companies are facing in implementing the measures announced by President Ramaphosa to deal with COVID-19. This includes understanding the specific impact in each industry, the adaptation strategies that are required from business and how best government can support them.

On Tuesday we met with stakeholders in the Tourism and Retail sectors, and on Friday we will be meeting with stakeholders in Agriculture. Further consultations with other sectors are being scheduled.

Supporting business
Furthermore, together with Wesgro, the City of Cape Town and industry partners, we have activated the official “COVID-19 Content Centre for Business”, a virtual centre consisting of sector specialists and communications experts, set up to develop reliable content to assist industry and manage daily queries and business concerns.

Businesses requiring support are encouraged to send their questions to supportbusiness@wesgro.co.za.

Tourism and travel
A host of measures are being actioned to support the tourism and travel sector to adapt, which includes assisting industry stakeholders and visitors to the Western Cape with issues such as cancellations and postponement, insurance and other staff and labour-related concerns.

The Department of Health have created flyers advising travellers returning to South Africa about the measures put in place to stop the spread of COVID-19. Twenty thousand of these flyers have been dispatched to Cape Town International Airport to ensure this message is received.

Following our meeting with the tourism sector, these flyers have been shared with to the tourism industry to distribute to visitors in the Western Cape.

Shopping malls and retail
In our meeting with shopping malls and retail, representatives from this sector indicated their commitment to supporting our efforts to stop the spread of COVID-19. We commend those that have already put in place significant measures in their operations, for example Pick ‘n Pay who have provided special opening hours for pensioners to shop between 07:00 – 08:00 on Wednesdays.

Importantly, the retail sector has indicated that at this time they have enough stock of critical materials to get us through this crisis, such as hand sanitiser and toilet paper, and that there is no need for panic buying.

Appeal to business
We acknowledge the major challenges businesses are experiencing right now. Many are taking innovative steps to allow for social distancing, like ensuring their employees don’t have to use public transport and digitising more of their operations, but there is always more that can be done.

We appeal to all employers to do what they can to let employees work from home. Every business should develop a social distancing approach that means staff should not be forced to be in close proximity to each other.

A best practice guide is being developed to assist businesses to stop the spread, and together with other FAQs on COVID-19, will be published at www.westerncape.gov.za/coronavirus

Our primary concern remains the health and safety of all those in the Western Cape. However, we remain committed to supporting businesses through these difficult times. By working together, we will do everything we can to stop the spread of COVID-19 and ensure the recovery of our economy in the Western Cape.

STRAIGHT TALK: Key to managing Coronavirus is to slow its spread

Coronavirus has become a pandemic. Although it is still developing rapidly, there is already a lot South Africa can learn from other country experience – China, Italy, Singapore, Taiwan, South Korea and others – to reduce its impact here in South Africa.

It is now clear that countries that anticipate the virus and act swiftly have both a lower infection rate (infections per 1000 people) and a lower fatality rate (deaths per infections).

The coronavirus (Covid-19 virus) hits a country gradually and then suddenly because it grows exponentially unless checked. The number of actual cases of infection will be much higher than the number of officially reported cases because of the lag in time it takes for symptoms to appear.

The key to limiting damage is to slow the spread of the disease as much as possible. Even if the same number of people are ultimately infected, it is vastly preferable for the virus to spread slower. This reduces pressure on our healthcare system, enabling it to handle cases much better, which in turn drives down the fatality rate.

The more we postpone cases, the better healthcare those infected will get, the lower the mortality rate, and the higher the share of the population that will be vaccinated before it gets infected.

The most simple and effective measure we can take now is social distancing: keeping people home as much as possible for as long as possible until the virus recedes. The less social interaction there is, the slower the virus will spread.

This virus can be spread within two metres if someone coughs. It survives for hours or days on surfaces, so frequently touched things such as doorknobs can spread the infection to our hands, which then gets into our systems when we touch our nose, eyes or mouth.

The only two options for South Africa are containment and mitigation. Containment is making sure all cases are identified, controlled and isolated. Singapore and Taiwan have done this very well. They quickly limited people coming in, identified the sick and isolated them.

Once there are hundreds or thousands of cases, containment isn’t enough, and the next level is mitigation requiring heavy social distancing. Italy left it too late and now the entire country is in lockdown. The country has moved to close all non-crucial commercial activity, with only transportation, pharmacies and groceries to remain open.

At first glance there appears to be a trade-off to acting now, while there are so few confirmed cases in SA. People will be asking themselves if the socio-economic cost of social distancing now (working from home, cancelling large events) is worth the reduced health risks.

But both the health and socio-economic costs of waiting until the infection has spread more widely will be far higher, as supply chains are disrupted and vulnerable businesses are pushed closer to bankruptcy during a major lockdown.

So, the time to take social distancing and other preventative measures (covering your mouth when you cough, staying at home if you have a fever, washing hands frequently, avoiding touching your face with unwashed hands) is now, even as government does what it can to contain the spread of the virus.

Those countries which have acted early and swiftly to contain and mitigate have reduced the number of deaths by ten times.

In SA, there is a fairness issue to consider. Coronavirus will hit wealthier people first, as they’re the ones who can travel to places like Italy, UK, China and bring it back here. But it will hit poorer people hardest, as they have less access to quality healthcare, and less financial buffer if this virus results in job losses, which is highly likely.

The urban poor will find it harder to slow the spread, living in densely populated townships and using public transport. So, there is a moral obligation on wealthier people to take precautions, particularly social distancing, now to slow the spread of the virus.

In addition, our healthcare system needs manpower and money, so that it is best able to treat those who do become infected.

This virus highlights the importance of building a capable state. A capable state is a resilient state, with the ability to manage disasters and recover quickly. South Africa is vulnerable now, because of our largely dysfunctional public healthcare system and our growing debt problem. Living prudently and saving for a rainy day applies as much to a country as it does to a family.

The DA is committed to building a capable state. Our universal healthcare plan, Sizani, would be faster and more effective than NHI at extending healthcare to all in SA. This week, our Fiscal Responsibility Bill was published in the Government Gazette for public comment. It will be tabled next week. If passed, it will help reduce our national debt and the associated debt service costs.

As a country, we need to be sure that we have enough money ongoing to spend on essential services such as health. And we need to build buffer into our system, so that we can cope with unexpected challenges. More than anything, building a capable state means employing people who are qualified to get the job done. As with tackling Coronavirus, the sooner, the better.

STRAIGHT TALK: Recession: now’s the time to flip the script

In a speech last month, Dennis Davis warned: “There can be little doubt that existing patterns of poverty and inequality threaten the possibility of continued democracy and the stability of the South African state.

We would do well to heed his warning.

This week StatsSA reported that SA’s economy grew at 0.2% in 2019. Compare this with the world and African average of around 3% and Ethiopia’s of around 9% and it’s clear we’re on the wrong track here in SA.

Our population is growing at around 1.4% each year. So, we’re are all getting poorer, and have been doing so for the past five years and will keep doing so until we change track.

Two years in, and South Africa has slipped into the second recession of Ramaphosa’s presidency, with our economy having contracted during the second half of last year.

Though “slipped” is the wrong word – more accurately, it was shoved into recession by a government committed to outdated command and control ideology.

We will never get out of our low-growth, high-debt trap by continuing to operate within the same paradigm that plunged us into it in the first place: ever-increasing state control. We need to change paradigms from concentrating power in the state to dispersing power to citizens.

Less state control means more private sector control. In other words, it means unleashing the real economy-builders and job-creators: entrepreneurs and investors.

It would be a mistake to shield Ramaphosa from blame for this recession by arguing that our economic collapse is the result of state capture and corruption during the Zuma era.

State capture and corruption are themselves the consequence of excessive state power. Cadre deployment and BEE are the key enablers. Ramaphosa directed the former and embraced the latter.

We didn’t just drift here. This is the ANC’s grand two-step plan – what they call the National Democratic Revolution – in which first the ANC takes control of all levers of power within the state and then the state takes control of every aspect of our economy – and, ultimately, of our lives, rendering us completely dependent on an all-powerful state.

This is the communist script and if it didn’t work in the 20th century it certainly won’t in the 21st against a technological tsunami driving diffusion, be it of the capacity to publish information, generate power, hail lifts or sell accommodation. It’s high time to flip the script and disperse power to the people.

Yet Ramaphosa’s policy response to our economic crisis has been to double down on more centralisation and control. This will only deepen and prolong the crisis.

SONA, the budget, and other ANC utterances show that the government is committed to an ever-increasing role for the state. More state ownership of land and companies through EWC and prescribed assets. More control of our health sector. Retaining control of our energy sector by pumping R230 billion into Eskom even though the best route to reliable, affordable electricity is to sell off power stations and open the energy market to full competition. Retained ownership of SAA, even at a cost of R16 billion which could have built over 200 brand new schools. More BEE and employment equity. More control and ownership via a state bank and a sovereign wealth fund, as if the country is awash with cash.

And it certainly isn’t. On the contrary, it’s going bankrupt, spending R1000 million more per day than it earns in tax revenue. Because here’s the thing. This outdated ideology of “more state” doesn’t just suffocate the private sector, it also kills the state itself.

Hence the state is now cutting back spending on essential services such as education and health. Only a state hellbent on ownership would pump R16 billion into public transport for the elite while cutting R3.9 billion from healthcare to the poor, as they did in this budget. This kind of trade-off only fuels inequality and instability.

Any real plan for reform, such as Treasury’s plan that Tito Mboweni published last year, is quickly shot down. To placate investors and ratings agencies, Ramaphosa is flirting with reform, promising to open power generation to more independent producers (IPPs), allowing municipalities to purchase direct from IPPs, and slowing the growth of the public sector wage bill.

But he’s being very timid in implementing these promises. SONA was a full three weeks ago and there are still no firm commitments around when bid window 5 will open for a new round of IPPs to sell power to Eskom, or when municipalities will get the go ahead to start purchasing direct from IPPs.

Tinkering at the edges will not solve our crisis. We need a wholesale paradigm change. The state must not own and direct the economy. Citizens must own and direct the economy. Real empowerment gives power to the people, not the state.

Power to the people underpins the DA’s vision of an open, opportunity society and our plan to fundamentally fix what is broken in our economy and roll back poverty, inequality and unemployment.

In South Africa, economic justice – of the sort that uplifts rather than immiserates the majority – can only come from a growing, people-driven economy. Last week, the DA released its draft Economic Justice Policy for public discussion ahead of our policy conference in April. It is our plan for tackling the injustices that exclude over 30 million South Africans from our economy. It is a plan to empower the majority. That’s what flipping the script is about.

STRAIGHT TALK: Facing up to our challenge

The American writer and civil rights activist James Baldwin once said: “You cannot fix what you cannot face.” We would do well to remember these words as we set about restoring people’s trust in the Democratic Alliance.

It is no secret that we have had our challenges. Last year, we learned that the voters of South Africa are more discerning than they are sometimes given credit for, and – for the first time in our history – the DA went backwards in an election.

The reasons are numerous and were covered extensively in a report commissioned by the party leadership. I am not going to rehash that here suffice to say that we have learned many lessons from the last three or four years. What’s important is that I am ready to face up to the challenge of fixing the DA.

This work has begun in earnest since I was elected interim leader in November 2019. The DA of 2020 already feels worlds away from the DA of 2019. We are beginning to develop a clear sense of political direction for the party. We are finalising a range of big, bold policy ideas for discussion at our policy conference in April. And we are gearing up for an historic federal congress in May where we will elect a new leadership team.

We are also winning the battle of ideas in Parliament. While other parties disgracefully used gender-based violence as a political football in the National Assembly last week, we were offering reasoned critique and workable policy alternatives. Every single DA speaker in the State of the Nation debate distinguished themselves and our party.

The proof of our growing credibility lies in the number of DA policies that have now been taken up by the government. For example, in President Ramaphosa’s State of the Nation Address, he finally relented to DA pressure on the electricity crisis. We have said for years that we need to add grid capacity from renewable energy, gas and hydro, that we urgently need to open bid window 5 for renewable energy, that we need to allow commercial and industrial users to produce their own electricity and that we need to let municipalities procure their power directly from producers. And, in his speech, the President announced all of these things.

Just look at Finance Minister Tito Mboweni’s budget tabled this week. Of course, we don’t agree with everything he said – he needed to be much bolder on underperforming State-Owned Enterprises such as Eskom and SAA and he needs to do more to rein in spiraling debt.

However, Minister Mboweni did exactly what the DA has been pushing for. He offered some relief to overburdened consumers with a number of tax cuts, and he has pledged to cut government expenditure – particularly on the bloated public service wage bill. This has put himself firmly in the cross-hairs of the ANC’s alliance partners and he should roundly be applauded for this. We will be watching with interest to see whether he and the President have the courage to follow through.

Importantly, for the DA, we are starting to get real results where it counts – at the ballot box. In this regard, I could not be prouder of the Democratic Alliance Students Organisation (DASO) and its recent string of victories in Limpopo. On Monday, DASO won nine seats during SRC elections held at the Vhembe TVET College. This follows DASO winning the majority of seats during an SRC election held at Mopani South East TVET Campus earlier this year. At this campus, DASO contested four positions, winning all four.

The significance of these victories (which, naturally, went unnoticed by the media) is that these voters are young, black South Africans freely choosing the Democratic Alliance. This is a far cry from the fevered imagination of those commentators who write us off as a “white party”. If these so-called analysts could spend one day outside of their elitist bubble, they would see just how hollow this hackneyed descriptor is.

It seems that there is no shortage of commentators out there who feign concern for the DA, only to drag us down at the first opportunity. The most spectacular example came this week with the publication of three-month old polling data to “prove” that the DA was in terminal decline. What those who publish this nonsense don’t seem to realise is that every time they do it, they damage their own credibility and not the DA’s.

Make no mistake, when it comes to rebuilding a politically party, the road is arduous and littered with potholes. But there can be no short cut for the hard work and long hours that are required. History is our best lesson when we look back at what it took to rebuild the then-DP after it’s nightmare election in 1994 where it achieved only 1,7% of the vote.

A man by the name of Tony Leon stepped up to the plate. Within five years he increased the DA’s support five-fold to overtake the National Party as South Africa’s official opposition party. There was no particular secret to his success – he made sure that the party knew what it stood for, and he got everybody pulling in the same direction.

These are the same crossroads we find ourselves at today, nearly 20 years later. We need to keep broadening our appeal to more and more voters, and we need to stand up for those voters that loyally have stood by us for so many years. I can promise you; we will never again take these voters for granted.

We are prepared to face our challenges in order to fix them. And I am buoyed by the brilliant team I get to work with every single day — the activists, the councillors, the MPLs and the MPs. I know that, together, we will once again emerge victorious.