It was interesting to note the coverage of some rather unclear remarks by Finance Minister Tito Mboweni in his mini-budget speech on the controversial e-tolls – the fees charged for using upgraded Gauteng motorways.
At least, I found them ambiguous. He said:
Government has decided to retain the user-pay principle. While there will be a further dispensation and value-added services, compliance will also be strengthened.
Not paying your tolls has already led to our roads deteriorating. We have been unable to maintain the network. I urge the nation to please pay your bills.
We need to build a culture of payment, as government services can only be sustainable if all of us that can pay for services, do so.
I did try to challenge him on this during a press briefing but was let down by a dry throat. Those of us in Pretoria were forced to shriek our questions at a screen/hidden microphone, which was our end of a link-up to events in Cape Town.
My dry throat was partly due to being held in an over-heated room for a briefing which started 45 minutes late.
I tried to suggest to Tito that e-tolls are just ONE WAY of implementing the user-pays principle, but I croaked out my question and did not get much of an answer.
In general, the media coverage was pretty unanimous, reporting that the tolls were here to stay.
However, less than 24 hours after Tito’s teaser, a statement came from one of his ministerial colleagues (opponents?), once again using the governmental communications device of ambiguity.
It reads:
The Minister of Transport Fikile Mbalula has noted the directive of Cabinet on the matter of the Gauteng Freeway Improvement Project (GFIP), which incorporates electronic tolling (e-tolls).
Cabinet noted the options considered by the Task Team appointed by the President of the Republic Cyril Ramaphosa, comprising Minister Mbalula as the Chairperson, Finance Minister Tito Mboweni and Gauteng Premier David Makhura.
Having duly noted the options presented, Cabinet resolved that further work be undertaken in answering to the challenges posed by the options identified. The Task Team will explore the directives of Cabinet, continue engaging stakeholders and report back.
The Minister of Transport will communicate the details once the process has been finalised.
The task team seems to have recommended that e-tolls be retained, with discounted charges.
However, lobby group OUTA has lobbed a challenge to this, pointing out the pathetic record to date in collecting the toll cash, and suggesting a more effective mechanism, such as collection through a fuel levy.
What is not clear is whether this option has been booted through the window by Tito, or if some more effective plan is still possible, which might improve the collection of cash for the use of the improved freeways
The media coverage suggests that Tito has won.
I hope not.
NB. Soon after this was first published, the Transport Minister held a hasty briefing, in which he confirmed that the scrapping of e-tolls is STILL an option, and no decision has yet been made.
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Finance minister Tito Mboweni used his mini-budget (a phrase he hates) to read the riot act to parasitic parastatal Eskom.
In no uncertain terms, he warned that the hundreds of billions in taxpayer bailouts will be history.
In future, if funds are needed, these will be in the form of loans, not gifts.
He said: “At the moment there is a confusion. State-Owned Enterprises think they can always go to Father Christmas. Those days are over.”
He told MPs on Eskom that “government is supporting Eskom with R230 billion over the next 10 years. New cash flow support will no longer be equity but will be in the form of loans.
“To meet unanticipated cash needs, they have brought forward R26 billion in 2019/20, R33 billion in 2020/21 and R10 billion in 2021/20. Further delays in operational reforms could mean additional support is required.”
The minister said that asset sales remain under consideration, and he welcomed the fact that SAA has provoked the interest of equity partners, which may remove the “sword of Damocles” hanging over it.
He also condemned public waste, saying that the cell phone costs alone of civil servants amount to R5bn a year.
Business-class travel will be out for domestic flights – from ministers down – and ministers will have R700 000 caps on the purchase price of their official vehicles. There will also be widespread salary freezes.
Efforts, meanwhile, will also be made in public sector wage negotiations to trim the overall bill – most probably by shrinking the workforce.
Here are some high (low?) lights from the mini-budget:
The economy is now forecast to grow at just 0.5 per cent in 2019 compared to the 1.5 per cent expected in February. Growth is projected to slowly rise to 1.7percent in 2022, supported by household consumption and private-sector investment. South Africa’s economic growth continues to fall well short of what is needed to create jobs and raise living standards.
Revenue is estimated at R1.37 trillion this year. This is R53 billion, or 4 per cent, less than expected.
The main changes to the in-year expenditure projections are:
R26 billion in additional financial support to Eskom
R11 billion to several smaller state-owned companies in financial distress
R430 million approved through the Budget Facility for Infrastructure for student housing.
The consolidated budget deficit is now projected at 5.9 per cent of GDP in the current year (4.5% in 2019 budget). This year, the national debt exceeded R3 trillion. It is expected to rise to R4.5 trillion in the next three years.
Spending reductions of R21 billion in 2020/21 and R29 billion in 2021/22 have been identified – mostly in the area of goods and services, and transfers. If government wants to achieve its target, it will need to find additional savings in excess of R150 billion over the next three years, or about R50 billion a year.
For the foreseeable future, Cabinet, Premiers and MECs’ salaries will be frozen at current levels, with the likelihood of an adjustment downwards. The cost of official cars will be capped at R700 000 VAT inclusive. A new cell phone dispensation will cap the amount claimable from the state. All domestic travel will be on economy class tickets. There will no longer be payment for subsistence and travel for both domestic and international trips
Government is supporting Eskom with R230 billion over the next 10 years. New cash flow support will no longer be equity but will be in the form of loans. To meet unanticipated cash needs, they have brought forward R26 billion in 2019/20, R33 billion in 2020/21 and R10 billion in 2021/20. Further delays in operational reforms could mean additional support is required.
There are conversations involving SAA and potential equity partners, “which would liberate the fiscus from this SAA sword of Damocles.”
On e-tolls, Government has decided to retain the user-pay principle. Compliance will also be strengthened.
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The politicians who run South Africa’s official opposition, the Democratic Alliance (DA), have probably never heard of “imposter syndrome”. If they had, they might have a better grasp of the problems which confront their party – and its first black leader might not have been forced to resign.
“Imposter syndrome” is a state of mind in which a successful and competent person doubts their achievements and harbours a persistent fear that they should not be enjoying success and will soon be exposed as a “fraud”. It was identified by two American psychologists in a 1978 article, which found that the problem was widespread among high-achieving women, far more so than among men.
Since then, others have connected the dots to explain why people should feel this way. The syndrome, they suggest, is a product of prejudices that insist that some groups should monopolise important tasks and the skills and responsibilities which go with them. The women with “imposter syndrome” were doing well at jobs that, according to the prejudices among those who controlled their society, only men could do. They were, therefore, sure that men were judging them. And so, in a sense, they began to judge themselves despite the fact that they were clearly good at what they did.
This does not apply only to women who are doing jobs usually monopolised by men. It could equally apply to black people occupying positions that were held only by whites and whose “imposter syndrome” reacts to the prejudice which insists that only whites belong in the role.
This will probably shape how people operate in their “imposter” roles. They could be reluctant to express views or take decisions that might offend others in the organisation because they are convinced that the people who used to monopolise the role will dismiss them as a fraud.
It is also possible that, in a way, the people who suffer from the syndrome really are imposters. People who are drawn from a group that did not occupy the post in the past may have ways of doing things that are unlike those of the traditional officeholders: women may do some things differently from men, black people may do things differently from whites. They are then likely to be labelled as frauds by others despite the fact that what they are doing may be as effective as – or more effective than – the “traditional” way of doing things.
All of this is directly relevant to this week’s resignation of Mmusi Maimane, who in 2015 became the first black leader of the traditionally-white Democratic Alliance (DA).
Depends on who is doing the judging
Maimane was forced out of the party leadership because a DA committee consisting of three white men held him (and some of its white leaders) responsible for the fact that the DA is losing ground in elections. Whether their judgement was fair is hotly debated. But key for “imposter syndrome” is the judgement the panel passed on Maimane. He was, they said, “indecisive” and “conflict-averse”.
Given what we know about “imposter syndrome”, it is not hard to see why a committee composed entirely of members of the group that has run the party since it began should judge him this way. If Maimane was indecisive, it may be because he feared deep down that, if he did decide, he would be called out as a fraud by the people who ran the party – this happened anyway, despite his supposed indecision. It is even easier to see why someone conscious of being judged by people constantly testing whether he is “one of us” would want to avoid conflict.
It is also possible that Maimane was an “imposter” in the second sense – that what appeared indecisive and “conflict-averse” was actually a different, and perhaps more effective, way of doing things.
The committee’s complaint that he was averse to conflicts may well say more about them than about him. Why is enjoying conflict a virtue? Should we not rather value people who avoid conflict? People with a different value system could see a “conflict-averse” person as a “peace lover” or a “conciliator”. And “indecisiveness” could mean a refusal to take decisions the review committee and the rest of the party establishment want him to take, not a failure to decide.
The committee’s verdict on Maimane may be less an indictment of him than a judgement on it and the traditional DA leadership it represents. It suggests not an iota of sensitivity to the possibility that a black person elected to lead a traditionally white organisation may find it difficult to be decisive if she or he is subject to constant doubts about whether they really fit the role. Nor is it alive to the possibility that Maimane may have been doing things differently but better and that the organisation’s white leadership may have found that difficult.
All this has implications way beyond the DA.
Widespread problem
“Imposter syndrome” is quite likely widespread in South Africa among women and black men who hold senior positions in organisations that were led by men or white people.
The reason would be much the same as it is in the DA – most white-led or male-led organisations tend to think that they can absorb people who were excluded and promote them to leadership positions without changing the organisation. The way in which whites or men ran it in the past is assumed to be the only possible way it could run, and changing it would mean “lowering standards”. So, the black men or the women who occupy these posts become “imposters” if they want to do things differently, even if that would strengthen the organisation.
At the same time, the prejudices of groups who dominate can be very strong – so strong that the targets of the biases start to wonder deep down whether they are really unfit for the task. In South Africa, white men running large organisations and taking on complicated technical tasks has been the norm for decades and so people come to assume that only they could do these jobs. It is no surprise that black people and women who are perfectly capable of doing them wonder deep down whether they are really up to the task.
So, whether or not Maimane was good at leading the opposition, his resignation is important because it highlights one of the core problems of democratic South Africa – the assumption that the only way to do anything is the way white men did it in the past, and the damaging attitudes this produces on both sides of the divide.
Ebrahim Patel and Trudi Makhaya (picture supplied by the dti)
By John Fraser
Sometimes you can tell a lot from how a question is not answered. So it was instructive to hear from the President’s Economic Advisor Trudi Makhaya as she joined Trade and Industry mega-minister Ebrahim Patel for a pre-dawn briefing on next month’s Investment Summit.
(When I say it was pre-dawn, it was actually at 8am, which is pre-dawn for any self-respecting journo).
She and Patel were asked if they hoped to better the pledges for new investment which were made at last year’s Summit, which amounted to R300bn.
In a textbook example of economistic babble, she noted that investment can come in bunches, and the trend is more important than any individual set of numbers.
Then came the real giveaway, when she said: “One could argue that we overshot last year.”
This makes sense. There was low-hanging fruit to pluck last year and a suspicion by close observers that some of the investment projects were already in the pipeline when they were scooped-up into Cyril’s line-up and announced at a ceremony based closely on a Hollywood gala. Newish, rather than still-in-the-box new.
So, expectations are being managed. This year’s total may be a bit lower and the spin is being crafted.
You had to be awake to notice this warning, which is probably why the briefing was held before the average journo’s wake-up alarm had begun to buzz.
It was interesting, meanwhile, to learn that a team of outside advisors has been hired to assist with the communications at the Summit.
A cynic might suggest this implies a lack of enthusiasm for the efforts (ability?) of the many highly-paid civil servants who are normally entrusted with turning ministerial statements into common sense.
It could also mean that the sponsors – who include Vodacom, Anglo American and (what is left of) Naspers – are happily funding the communications budget along with the rest of the three-day bean-feast.
Certainly, there is immense room for clearer communication at this second Summit. The first one seemed almost entirely aimed at the TV screens, a sort of Mr/Mrs/Miss/All Three (one must be modern about these things) Investor grand final.
(Just as well that those pledging will be judged by the contents of their wallets and not their looks.)
I am still giving Cyril the benefit of the doubt. Unlike his predecessor, he is raking in cash for the good of the country, not the hoods of the country (Guptas et al).
One could argue that we overshot last year. So what if this year the total to be announced falls short R300bn?
The struggle continues, and hopefully, Eskom will keep the lights on for long enough to enable the delegates to fill in and sign (preferably in blood) their pledge forms.
Every billion counts.
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Remaining in the Cape, but moving from grapes to apples, our tasting team tackled the Loxtonia crisp apple cider, which came as a revelation.
Guru to the philosopher Epicurius Michael Olivier introduced it to writer and analyst Chris Gilmour, economist Mike Schussler and Gumtree auto’s Jeff Osborne, while John Fraser sipped and purred.
Take a bite out of the podcast, by clicking below:
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Do also check out: http://www.michaelolivier.co.za
The resurgence of vinyl records in a time of digital music and streaming is a story of how innovation can make technological comebacks possible. In the summer of 2019, the sales of vinyl albums are on the verge of becoming the largest source of revenue from physical sales in the music industry. This follows 15 years of an upward trend – today, while remaining a niche product, the vinyl record may well eventually survive to be the only analogue medium for music, as the sales of CD continue their downward spiral.
Researchers in sociology and consumer culture have shown how this trend goes well beyond nostalgia – buyers of vinyl are attracted by its status as an object, its physical presence. This attraction matters, even more, today, as most of the time listening to a song does not involve buying physical support anymore.
Our study starts with this vinyl comeback. We try to show how it is precisely the process of innovation, in which a new product or technology replaces an outdated one, that opens the possibility for an even older and obsolete product or technology to become relevant again.
To do so, we need to go back to the late 1980s, when sales of compact discs outsold vinyl records for the first time (in 1988), and then the sales of cassettes (in 1993). In 1998, vinyl represented only 0.7% of the total music industry revenues.
Three generations of recorded sound.HK-PHOTOGRAPHY via Shutterstock
Why did consumers start to abandon vinyl and cassettes? Because compact discs are more resistant to scratches. Because they are simply more practical, easier to store, and easier to switch to the song you want to listen to. Because compact discs were sold to them as of superior sound quality: they can, in theory, emulate the sound of vinyl to a sampling rate indistinguishable from the original to the human ear while being able to reproduce more extreme frequencies (purists disagree).
Three decades later, digital music has replaced compact discs. In the US, the streaming industry accounts for 80% of music industry revenues. Looking back at the criteria that made the vinyl obsolete, the current streaming technology outperforms compact discs in every dimension: high sound quality and no scratches or storage problems.
The only characteristic on which the compact disc can compete is its physical presence – some people want to possess an object they can touch and display in their home. But on this dimension, it seems vinyl is doing much better than compact discs. Hence, people attracted by the object are more likely to buy vinyl to complement their digital consumption.
The music industry and vinyl retailers have well understood the importance of that dimension. Recent new and re-releases of vinyl incorporate special features which play up the attractions of buying vinyl. Heavyweight vinyl pressing suggests the importance of the musical content. The same holds for coloured vinyl or other special features such as cover art posters.
Predators and prey
This is a story of predators and prey – and is not unique to the music industry. Once the appearance of new technology leads to the extinction of the previous one, it can be interesting to look at what existed before. Some of the characteristics of a long-extinct technology may have become relevant again now that the predator has disappeared. The key is then to identify how to emphasise these characteristics to the old format work alongside the new format.
Making a comeback? Polaroid cameras.Savanevich Viktar via Shutterstock
In the photography industry, the first generation of analogue films has been almost entirely replaced by the second generation of digital cameras. A third-generation, based on smartphones and social networks, was not originally designed for physical printing.
As more and more consumers now use the third-generation, abandoning digital cameras – according to data by the Camera and Imaging Product Association, shipments of digital cameras have decreased by more than 60% between 2010 and 2019 – the physical dimension of analogue photography seems to have become a useful complement. As a result, photography on film has started to return as a niche product – and discontinued products such as Kodak’s Ektachrome or Fujifilm’s black and white films are being reintroduced.
Some consumers, who had abandoned products of the first generation start using them again as a complement to the third one. As in the case of vinyl recordings, the industry has well understood the demand for tangible photography, beyond simply reverting to old cameras. Polaroid is soon to release a “Lab” to print analogue pictures of images taken on smartphones. Fujifilm’s Instax, meanwhile, offers the possibility to print a format similar to Polaroid based on digital pictures.
Not every comeback is possible. Many products and technologies disappear because they have nothing useful to bring anymore. But when a new product or technology starts dominating a market, it may be a good idea to look at what existed two or three generations before. This may well prove to be part of the future – even if it’s just a small one.
Renaud Foucart is Senior Lecturer, Lancaster University Management School, Lancaster University
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By John Fraser
ZA Confidential 