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Speech by MEC Nkwinti at the Metropolitan retreat
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Speeches and Media Releases
 Housing and Local Government

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EASTERN CAPE PROVINCIAL GOVERNMENT

SPEECH BY MEC GUGILE NKWINTI

AT THE METROPOLITAN RETREAT HELD AT FISH RIVER SUN

4 TO 5 SEPTEMBER  2000



TWO CONTESTING MODELS OF THE STATE: REFLECTIONS OF SOME ANALYSTS

The most dominant state model today is the competitive state model. It generally and specifically reacts to the so- called monopolistic 
state model. What people generally and disparagingly refer to as Thatcherism is the competitive model of the state.

Briefly, the competitive model of the state, whether at central or local level holds that:

* The state is essentially inert and incapable of creative and innovative solutions;
* It is a service provider
* In the latter role, it has long enjoyed legal monopoly;
* The central and strategic challenge is breaking down the monopoly by privatising; and
* Where privatisation is no possible, to push the down the cost of those services which are provided by the state.

The solution to the challenge is introducing competition within the state itself by turning its operations into market-like ones. This 
internal re-organization of the state organs finds expression in operational units that are supposed to be efficient and competitive 
service-providers, in the market sense. In the latter sense, these units would provide services as much as they would purchase such goods 
and services, as they would need in the open market. Generally, the effect of this is to drive down prices in the open market, and by so 
doing, it crowds out the states ability to deliver on what has remained residual to it with respect to service delivery. But open markets 
are open to so-called cyclical disruptions, especially in this era of global economy.

Capitalists will not allow prices to stay low for a long time because that will cut down their profits. They create cyclical disruptions 
that drive up prices of goods and services.

But, once, more, higher prices will kill or crowd out the states direct participation in economic activity. The overall effect of the 
competitive model, therefore, is the limiting of state involvement in economic activity. This is what Comrade Ronnie (SAMWU delegate who 
represented one of the labour unions active in the municipalities) referred to as the minimalist managerialist model.

Of course, this is not the model that Strategic Management Team of the Department of Housing, Local Government and Traditional Affairs 
submitted yesterday. It presented an alternative model to the one described above. It presented the developmental model. But it is still a 
concept that needs to be implemented and vigorously tested. Conceptually, the developmental state model is one which intervenes effectively 
to promote economic development.

The key term being intervenes. The developmental model implies major changes in policy process within itself. Some developmental state 
proponents point especially two aspects of these changes; namely:

* Coordinating and altering the objectives of the professional administrators or manager, and
* Expanding the working relations with groups outside the boundaries of the state.

At the social and political levels, proponents of the developmental model have been confronted by what has been referred as a 
characteristic conflict:

* Ambitions to promote economic regeneration and more egalitarian distribution of results, on the one hand, and
* A sharp squeeze on public resources and worsening local poverty and public services, on the other.

Perhaps, this conflict poses the most critical challenge to the states ability and will to make appropriate choices. Should such choices 
be based on morality or economic realities?

The developmental model seeks, and proposes, solutions that are sustainable. And, for that to happen, solutions must, whilst ideologically 
informed, be flexible and sensitive to the constraints in the global environment. A crucial element in creating a developmental state, in 
terms of some literature, is the transformation of internal social relations within the state - a process which, in turn, relies upon a 
changing relation between the states employees and citizenry. In the South African context, Batho Pele seeks to introduce this element.

a)Developmentalism: Policy

We have indicated above that the policy environment is conflictual and the dominant ideological model is the competitive one. Against this 
background, reconstructing the state to make it more capable of playing a developmental role would require acute conflict management skills 
based on a deeper understanding of the mechanics of the world economy today.

The developmental state must play an active role in social and economic reconstruction. Such an active role has implications, especially in 
a hostile environment:

* It means coping with competition between the need for investment on the one hand, and the need for immediate spending on much-need social 
services, on the other;
* It implies active state involvement in distributional issues, that is, confronting the issues of who benefits from social and economic 
reconstruction;
* It also, implies efforts on the part of the state to change the behaviour of (its) managers, workers and investors.

Interventionism, overall, implies new ideas and ways of work for the state employees; new relationships between state employees, organs of 
civil society and Jane Citizen.

b)Developmentalism: Process

Process in this context defines a way of working within the sate shifts the location of power, changes access to information of different 
social groups, and develops the capacities of previously disadvantaged social groups and persons. But, historically, the most disadvantaged 
people are the unorganised because they lack the time, the resources and expertise. To change this situation, the developmental state has 
to do a number of things, amongst them the following:

* It must be willing to actively develop its own mediators and critics amongst the disadvantaged;
* It must actively engage and encourage pressure groups amongst the people who previously lacked the capacity to influence sate structures 
and processes.

The following extract from a piece of work on the developmental state sums up well the exposition on developmentalism:

Developmentalism of &#145;process kind opens the state to new pressures that distance it from old certainties, provide new ideas. And 
offer support to more radical measures. Without the openness and conflict generated by new constituencies, proposal for economic 
regeneration will be captive to old assumptions, and any break with the past will rapidly come to seem impossible.

This is the outlook underpinning the developmental local government concept presented by the Department during the first session of this 
Strategic Retreat. The core business elements of the model constitute the primary responsibility of a municipality. They are what 
municipality ensure happens, as a service authority. Amongst the tactical things it should do to achieve this goal, the municipality must, 
according to one Local Agenda 21 proponent:

* Shift from short-term revenue enhancement tactics to long- term local wealth creation strategies;
* Build and deploy the services of internal wealth existing in the city municipality, and focus external investment or this effort;
* Undertake full- cost analysis of development and service alternatives, including life-cycle analysis; where possible; and
* Eliminate practices that deterioration of internal wealth.

All this is meant to come up with balanced social, economic and environmental sets of objectives which are community-orientated and 
investment driven.

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