living income guaranteed proposal for south africa

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http://livingincome.me The Living Income Guaranteed is a social security ‘net’ available to all on an as-needed basis to ensure the well-being of a nation’s citizenry when being unable to provide for themselves – this means guaranteeing our birthright to the use of natural resources to live.

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  • LIGLiving Income Guaranteed

    LIGLiving Income Guaranteed

    The Living Income Guaranteed Proposal for South Africa

    DRAFT 1.2 - 2014

  • 3CONTENTSThe South African Challenge 4

    In the Wake of Colonization: From Apartheid to Economic Discrimination 4

    Housing 4

    Healthcare, food, water and social security 7

    Incomes are Lifelines 9

    Living Income Guaranteed 10

    Moving beyond the boundaries of Western economics 10

    What is L.I.G.? 13

    Structural Adjustments 15

    Minimum Wage 15 Economic Ownership 15 Taxation 17

    Sustainable Pricing 17

    Automation, Transparency and the Digitalization of Money 17

    Matching Business with Sustainability 18

    Expected Benefits and Rewards of Implementing Living Income Guaranteed 20

    Real Economic Growth 20

    Eradication of poverty 23

    Education 23

    Housing 24

    Health 24

    Crime 25

    Relieving pressure on the environment 25

    A democratic economy 25

    Increased labour productivity and satisfaction 26

    A long-term solution that is readily available 26

    Concluding remarks 27

    Sources 28

  • 3I have fought against white domination, and I have fought against black domination. I have cherished the ideal of a democratic and free society in which all persons live together in harmony and with equal opportunities. It is an ideal which I hope to live for and to achieve. But if needs be it is an ideal for which I am prepared to die.

    ~ Nelson Mandela

  • 4 5

    THE SOUTH AFRICAN CHALLENGE

    Within its recent history, South Africa has proven that when it stands together as one nation behind a principle, behind hope, behind the resolve to create a better future for every citizen within it oppression can be transformed into cooperation and co-existence. Regretfully, South Africa has fallen from an apartheid of racism, into an apartheid of economic discrimination; resulting in a vast and extensive income gap. South Africa has successfully moved towards a society where opportunities are less linked to ethnicity but despite this advancement South Africa remains a country of extreme economic inequality and disparity. This disparity of economic distribution severely limits and obstructs a large section of the South African population from having access to the opportunities necessary to thrive and lead fulfilling lives. The last recorded GINI index1 by the World Bank quantifies this vast income disparity: on the index, South Africa stood at 63.1; indicating that the most affluent 10% of the population receives more than half the share of national income while the poorest ten percent, receives a meagre share of just 1.17%.2

    IN THE WAKE OF COLONIZATION: FROM APARTHEID TO ECONOMIC DISCRIMINATION

    2000 2006 2009

    GINI index 57.8 67.4 63.1

    Income share held by highest 10% 44.9% 57.5% 51.7%

    Income share held by lowest 10% 1.28% 1.07% 1.17%

    World Bank. Poverty and Inequality Database1

    1 A measurement of the income distribution of a countrys residents. This number, which ranges between 0 and 1 and is based on residents net income, helps define the gap between the rich and the poor, with 0 representing perfect equality and 1 representing perfect inequality.2 World Bank, Development Research Group (2013). Data are based on primary household survey data obtained from government statistical agencies and World Bank country departments. Data for high-income economies are from the Luxembourg Income Study database. For more information and methodology, please see PovcalNet (http://iresearch.worldbank.org/PovcalNet/index.htm).

  • 5South Africa may have liberated itself from overt colonial rule, but economically remains within a neo-colonial economic model. Within the constraints of this model and this value system (or lack thereof), South African leaders have not, as of yet, been able to realise the goals and aspirations for the country and its citizens expressed in the Bill of Rights; a Bill of Rights that was incorporated in the South African Constitution in 1994.

    We highlight but a few points:

    HOUSING

    26. Housing1. Everyone has the right to have access to adequate housing. 3

    According to the Housing Development Agency, 27% of all households live in informal settlements. Allow us to stress the meaning of 27%: Considering a population of approximately 52 million South Africans, 27% refers to about 14 million individuals living in informal settlements. The inadequacy of such housing is reflected in the following numbers.

    In 2001, 26% of households living in informal settlement EAs4 had piped water in their dwelling or on their yard. A further 33% could obtain piped water within 200 metres of their dwellings. 32% had access to piped water in excess of 200 metres from their dwellings (there is no indication of how far away the water source is) while 9% had no access at all. 19% of households in informal settlement EAs used flush toilets, 43% used pit latrines, 15% used bucket latrines and 5% used chemical toilets; the remaining 19% had no access to toilet facilities. 32% of households in informal settlement EAs used electricity for lighting and 56% had their refuse removed by the local authority.5 Although these numbers reflect 2001 conditions, comparing the data from the 2001 Consensus to the Community Survey of 2007, we see no significant improvement trend.

    3 Constitution of the Republic of South Africa (1996). Chapter 2 Bill of Rights. http://www.info.gov.za/documents/constitution/1996/96cons2.htm (accessed on 30 July 2013).4 An Enumeration Area (EA) is the smallest piece of land into which the country is divided for enumeration, of a size suitable for one fieldworker in an allocated period of time. EAs typically contain between 100 and 250 households5 Housing Development Agency (2011). South Africa: Informal settlements status. http://www.thehda.co.za/resources/entry/informal-settlement-status-in-south-africa (accessed on 01 July 2013)

  • 6 7

  • 7HEALTHCARE, FOOD, WATER AND SOCIAL SECURITY

    27. Health care, food, water and social security

    1. Everyone has the right to have access to a. Health care services, including reproductive health care; b. Sufficient food and water; and c. Social security, including, if they are unable to support themselves and their dependants, appropriate social assistance5

    Access to health care servicesDespite intensive government efforts since 1994, the majority of the population has no access to good quality healthcare. Preventable diseases are not effectively prevented; and treatment, where required, is not sufficiently accessible or provided in a timely manner. Inadequate health care service has resulted in premature deaths and unnecessary suffering; adding to the poor health which is already a common feature in so many South African households.6

    Access to sufficient food and waterAccording to the Development Bank of Southern Africa, South Africa like other developing countries is in nutrition transition which includes the coexistence of under- and over-nutrition and has a malnutrition problem of public health significance. Despite various national nutrition and primary health care programmes being initiated in South Africa over the last decade, recent findings have indicated that child malnutrition rates and hence child health has deteriorated. At the national level, stunting and underweight remain the most common nutritional disorders affecting 1 out of 5 children and almost 1 out of 10 children respectively. Also 10% of the children were classified as overweight and 4% as obese. While, iodine and folic acid status appear to be adequate uniformly throughout the country, almost one third of women and children

    5 Constitution of the Republic of South Africa (1996). Chapter 2 Bill of Rights. http://www.info.gov.za/documents/constitution/1996/96cons2.htm (accessed on 30 July 2013).6 Department of Health (2011). National Health Insurance. http://www.doh.gov.za/list.php?type=National%20Health%20Insurance (accessed 22 November 2013)

  • 8 9

    were anaemic, 2 out of 3 children and 1 out of 4 women had a poor vitamin A status and 45.3% of children had an inadequate zinc status. Poor dietary intake, food insecurity and poor quality of basic services prevail within the context of an HIV/AIDS pandemic.7

    Access to social assistanceSevere shortcomings in the provision of social assistance is a daily reality for many South Africans. Since 1994 the government has implemented several successful initiatives to eradicate extreme poverty in South Africa. Social assistance grants have increased from R10 billion in 1994 to R37.1 billion in 2004 and currently reach 7.9 million beneficiaries, whereas in 1994 this number was still sitting at 2.6 million. Additional successful programs include the Expanded Public Works Programme, the Agricultural Starter Pack Programme and the Comprehensive Agricultural Support Programme. Despite these efforts, the NFSC-FB-I8 reported that in 2007, ...85% of the women respondents were unemployed. Unemployment was highest in Limpopo (93%), Mpumalanga (92%) and the Eastern Cape (91%). Nationally, more than one in two households (55%) had a monthly income between R1 R1000 with urban informal households reporting the highest percentage of no income (6%) as well as an in

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