The ANC, which is set to publish its final draft of a discussion document on the post-Covid-19 economy on Friday, has again returned to the theme of regulatory changes for the savings industry as well as more active monetary policy support to increase the funding of public infrastructure.
The paper is due to be published at midday, just a few hours after Business for SA releases its blueprint for economic recovery. Business for SA presented detailed proposals to President Cyril Ramaphosa last week, which it will release to the public on Friday.
The ANC paper is largely similar to the one tabled and discussed at its last national executive committee (NEC) meeting two weeks ago. At the heart of it is a proposal for an “infrastructure-led” recovery, which will see an expansion of public investment boosting economic growth. But, the stumbling block as always, will be how to pay for it, with the ANC paper again suggesting that “changes should be made to regulation 28 under the Pension Funds Act to enable cheaper access to finance for development”.
The paper also suggests that fiscal and monetary policy will have to be closely co-ordinated “to ensure ongoing access to capital markets and to reduce the cost of borrowing, as well as strengthening the role of development finance institutions”.
But neither the expected role of the SA Reserve Bank nor the anticipated changes to regulation 28 are explicitly spelt out.
It has been suggested by the ANC that the SA Reserve Bank should capitalise institutions such as the Development Bank of Southern Africa, to enable them to lend on a much bigger scale.