1. Elections on schedule:
The Constitutional Court has ruled that South Africa’s 2021 elections will go ahead on schedule and should be held no later than 1 November 2021.
The commission is expected to make announcements relating to the electoral programme and its readiness today.
This has placed the ANC in a difficult position, analysts say, as the party has failed to register candidates in many wards.
Given the ConCourt ruling, legal opinions say the ANC will not be allowed to register ward candidates where they have missed the deadline in 93 wards. A legal loophole might exist to allow members to register as independent candidates over a registration weekend, but this is still unclear.
2. 25% of South Africans vaccinated:
A quarter of all South African adults have received at least one dose of the Covid-19 vaccine. This represents some 10 million people who have either received their first dose of the Pfizer vaccine or their one-shot Johnson & Johnson (J&J) jab.
South Africa’s vaccination rollout has reached another important milestone, with 25% of all adults – aged 18 and above – being at least partially vaccinated against Covid-19. Of the 10 million people vaccinated by Monday, around 65% have been fully vaccinated.
The bulk of these vaccinations have been administered in the past two months, as part of a phased rollout which started in February. Initial supply constraints, the Beta variant’s evasiveness, and regulatory issues kept vaccination numbers low until July.
Between February and the end of June, South Africa administered around 3.2 million jabs. In July alone, with the rollout extended to those aged 50 and above – later to those aged 35 and above, and restrictions on walk-ins lifted – around 4.5 million doses were administered.
South Africa’s daily vaccination rate has continued to improve since the rollout was opened to all adults on 20 August. A million doses were administered in just four days – the quickest rate recorded since the rollout began – over the past week.
Even though South Africa is opening more vaccination sites with adequate staff and has a steady supply of doses, it’s struggling to meet its short-term target of 300,000 daily vaccinations. To combat vaccine hesitancy, the government is even considering reopening stadiums, musical festivals, and night clubs to those who have been fully vaccinated as a form of “encouragement“.
3. Service delivery improvements:
President Cyril Ramaphosa says that the government aims to establish a citizen-centred public service delivery system that is seamless, adaptive and responsive.
Writing in his weekly open letter to the public, the president said that public servants have been in the spotlight for the wrong reasons in recent years.
This adaptive service delivery model, or District Development Model, he said, would bring development to where it is needed the most.
“We have set ourselves the challenge of building a capable, ethical state. We remain firmly on course towards professionalising the public service and transforming it into a group of men and women who are able and committed to serving our people and their interests.
“We call on public servants to be part of this process by identifying ways in which we can realise a public service focused on meeting the needs and advancing the interests of citizens,” Rampahosa said.
“Our commitment to building a state that is ethical, capable and above all developmental necessitates that civil servants see themselves not merely as state functionaries but as development workers.”
Dlamini-Zuma said that the model seeks to strengthen the local sphere of governance – moving away from silo planning, budgeting and implementation.
The minister said that the new model would provide a ‘more tangible, common vision for development’ of the country.
“By adopting a long term view and interconnecting the local economies, we are able to re-imagine a better community, district and nation.”
To assist at a local government level, Dlamini-Zuma said that the government plans to employ skilled people at ‘district hubs’ to avail shared skills that local municipalities lack.
4. Limitation of assessed losses questionable:
Government seems set on limiting the offset of assessed losses against current income despite the devastating impact of Covid-19 trading restrictions and violence and looting that left businesses kneecapped.
National Treasury wants to limit the offset of assessed losses carried forward to 80% of the taxable income in each subsequent year. The proposal was first mentioned in the 2020 Budget and has now been published in the July Draft Taxation Laws Amendment Bill.
While a trade-off between limiting losses and lower rates can be justified, the South African Institute of Taxation (Sait) says it questions the timing of introducing such a limitation given massive losses caused by Covid-19. A one- or two-year delay should be considered once South Africa enters into a genuine recovery phase.
This limitation is, in part, aimed at funding the planned reductions in the corporate tax rate (28%), in line with global trends.
Sait’s corporate tax work group says in a submission to treasury that it understands the basis for the proposed limitation. The trade-off of limiting losses should presumably result in a more reasonable corporate rate of 25% to be worthwhile.
However, it does appear that SA continues to adopt anti-business policies from elsewhere in the world (in the name of anti-avoidance) which favour the fiscus whilst failing to adopt taxpayer or business friendly policies that the other countries do adopt.
Sait says it does not support a blanket application to all taxpayers. It suggests differential carveouts, with some being total carveouts and others for a limited period. Farming is in most need of a carveout.
5. Nuclear not full steam ahead:
Following a meeting by the board of the National Energy Regulator of South Africa (Nersa) on 26 August 2021, there were breathless public statements to the media by officials at the Department of Mineral Resources and Energy (DMRE) regarding a decision by the regulator in respect of 2,500MW of new nuclear power in South Africa.
The regulator was said to have “concurred” with a so-called Section 34 ministerial nuclear determination in terms of the Electricity Regulation Act (ERA). Some in the media fell for this hook, line and sinker. The nuclear energy sector was ecstatic, asserting that the procurement of 2,500MW of new nuclear power in South Africa would now commence.
However, in the days following the board meeting, Nersa seemed to be acting very coy — first about clarifying exactly what it was that the board had concurred with, and second, whether this was even a concurrence by Nersa after all, as opposed to a conditional concurrence that was still subject to a number of suspensive conditions.
Of course, the independent regulator was treading a very delicate line — to at least give the appearance that the noisy nuclear sector had got its way, while covering all political bases and legal angles, protecting its fragile reputation and taking care not to become the scapegoat for scuppering the nuclear ambitions of a fractious minister.
However, on 3 September 2021, Nersa finally succumbed to the growing pressure to release full details of its actual decision on 26 August 2021, with the reasons for decision (RFD) to follow in due course. In so doing, the tricky game that Nersa was having to play became more clear.
Contrary to the public statements and media interviews by DMRE officials, written details of the board decision reveal that Nersa has in fact not yet concurred with the Section 34 determination per se, but that such concurrence is still subject to a number of suspensive conditions which have not yet been met.
The precise wording of Nersa’s decision of 26 August 2021 in respect of the suspensive conditions, indicates that the energy regulator has decided:
To concur with the commencement of the process to procure the new nuclear energy generation capacity of 2,500MW as per Decision 8 of the Integrated Resource Plan for Electricity 2019 — 2030… subject to the following suspensive conditions:
- Satisfaction of Decision 8 of IRP 2019-2030, which requires that the nuclear build programme must be at an affordable pace and modular scale that the country can afford because it is no regret option in the long term;
- Recognition and taking into account technological developments in the nuclear space; and
- To further establish rationality behind the 2,500MW capacity of nuclear. A demand analysis aimed at matching the envisaged load profile post 2030, with the generation profile that would be needed to match that load profile, is required. This will assist to determine the capacity and the scale at which the country would need to procure nuclear.
It is thus clear that Nersa is only concurring with Decision 8 of the current Integrated Resource Plan for Electricity, IRP 2019-2030, to “commence preparations for a nuclear build programme to the extent of 2,500MW”, with this itself being subject to the suspensive conditions listed.
The regulator is not concurring with the commencement of a request for proposals (RFP) for new nuclear power in South Africa, nor is Nersa giving the green light to any new nuclear construction programme.