Vol.2 No.39, 24 December 2002

What Next for the BIG Coalition?

By Norman Reynolds

The ANC has decided to reject the BIG – however unclear the statements thus far about an alternate “comprehensive” set of social and anti-poverty measures. As I understand the ANC announcement on the BIG, the ANC will talk to the “progressive forces” but only to tell them why it does not want the BIG. There is not much room granted for persuasion.

Having pursued a loyal “Taylor” approach, it is now time the BIG coalition took seriously other approaches than that set out in the Taylor Report. The difficulties of implementation and the severe timetable constraints that do exist, as was established in the “Administration” meeting three weeks ago, have armed the opposition and government with a reason for inaction. The BIG could yet disappear, at least for a long and socially and economically costly while!

The minutes of the Administration Conference ignore the point that I made a few times during the meeting. There are other ways to distribute the BIG or similar social grant. The most appropriate and with the highest developmental and communal benefits is through communities organised at village and street level so that South Africa becomes 840 councils and, say, some 50,000 social and economic community-based development societies. This avoids the problems with Home Affairs documents. It also acknowledges that the Constitution demands that citizens lead local development – for which there must be local organisation [1], rewards for doing so, and support systems.

Local Economic Development (the LED) is the country's biggest and desperate gamble to improve the local economy and to give citizens the Constitutional right to be the "actors" supported by local government. The LED, to work, has now to organise communities for developmental purposes. The two requirements can be brought together.

The Department of Local and Provincial Government could well emerge as the champion of a universal grant system. It would work (a) alongside Social Development for the "soft" grants including the BIG and a rethought Child Rights grant assembled at community level and run by all adults for all children and (b) alongside Public Works for the Community Budget / Work and Training Rights investment grant / loan that I now believe will come through, at least in a pilot phase. It should spread quickly once demonstrated in keeping with community organisation to receive and mange funds that are theirs by programme right.

A dual grant system and the community-based method of payment would immediately create the conditions for a basic economic right and for two vital local functions.

The economic right is so basic it does appear in the Constitution. It is that communities would be “enabled” (a more active verb that empowered) by granting them (1) the fundamental economic right to know the resources available and the conditions that attach to different funding sources, as enjoyed by business, agencies and most households that have regular incomes. Communities can then (2) explore the opportunity costs of different investment / maintenance options and (3) can plan to invest in a sequence over time.

The two local functions that follow on are:

• Equal adult membership would allow, within state policy, communities to make decisions that optimised direct grant aid to the indigent and children and investment flows that might also attract matching loans (Land Bank, DBSA and IDC and later commercial banks to communities and to individuals) and joint venture partners so that the country builds the largest local productive base in the quickest time.
• A local payment system, community spending and investment flows, local wage and other payments and a subsequent enlarged local productive activity and greater local cash circulation would follow. That would help to balance state infrastructure with communal and individual directly productive investment and secure additional investment. It would also build the base for local banking that, under a NEDLAC protocol reached this last September, is now a national goal.

All and more can be won by taking seriously the principles and economic arguments of the Taylor Committee but by not sticking to its very "thin" implementation proposals that are muddled and wrong (the confusion of ends and means that is the Child Support Grant), that pose numerous implementation delays (individual bank accounts) and thus have left the BIG high and dry.

By listening to what government is trying (and should be further encouraged) to achieve, and by batting for community as the local working unit of society, the BIG coalition can help government find out not the usual “what to do” but the all important and somewhat rare “how to do”. That has to be a more constructive form of engagement with vast civil society opportunities to serve built into it.

The BIG remains the right set of principles, notably a universal grant, but in implementation terms it is just a piece of a puzzle. In this sense the ANC decision is right. The BIG’s proponents must bounce back with the adaptations that gain the equivalent of the BIG (even the BIG itself) within a suite of programmes suited to our conditions, levels of poverty and state local development aims (already in crisis) which, most crucially, tackle the horrific degree of inactivity in all local economies. These are the marginalised areas which house most citizens, nearly all the poor and which today hold the unemployed as economic prisoners. A bigger BIG is needed and awaits urgent attention.
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[1] There is in place a reform of the unorganised village into Community Trust (democratic property) Companies owned equally by all adults. The same model would hold for street and neighbourhood bodies in urban areas

© South African New Economics Network 2006. Page generated at 17:18; 24 September 2006