My saga of moving my Telkom landline continued from part 1.
DAY 28 A bearded Telkom technician arrives with his assistant. They are unable to install the line because my apartment requires a cable to be installed via a conduit which can only happen with the landlords permission. I am inundated by SMS from Telkom requesting me to rate their service online. I get a call from my landlord’s company offering me a 10mps wireless connection. No Telkom. Apparently this would entail gaining the password to his router. I attempt to decline the offer.
DAY 35 Still no home Internet. I am forced to use Internet cafes to file my SARS tax return. Problem is, I can’t find a cafe that is compliant with SARS efiling demand that I use adobe flash player 11. Apparently everyone in the real world is operating with flash 23. I head over to SARS office in town. There is no public access terminal available to do the task. Speak to an inane SARS employee who keeps telling me to file the return online. I seem to be in a boot loop, explaining that even my bank has a self-service terminal and doesn’t rely upon its clients to have private Net access. Fail.
DAY 36. I get a phone call from my landlord inquiring about my letter explaining why I believe a ‘fibre and cable’ option, and separate ‘voice and data’ services would be far better for my needs than low power radio access to his router. He has sent an Internet access form for his &*(^ provider, detailing its wonderful contention ratios, its commercial quality bandwith, (but no voiceline) and patiently tries to solve my voice and data issues by explaining that Skype offer a Skype-out service where one can call local numbers, I don’t even try to explain why paying for local calls in Dollars or Euros to isn’t going to be worth my while (Surely a gap in the market?), and in my case a choice between having connectivity or health insurance. He appears to relent when I explain that in order to access his marvellous router for which I would be handing over precious cash, some R150 more than my current service via MWEB, and without a guarantee on latency, I would need to invest in a WIFI receiver. I feel like a hillbilly holding out for Grandma, because she has a landline.
DAY 38 I am in a strange new world, in which the Tantalising Internet is both absent and present. (see The Curse of King Tantalus) For the vast majority, the Internet is whatever can be gleaned via occasional free wifi hot spots in cafes, (just buy a coffee). Or the traditional Internet Cafe (a dying breed) where you can hire a computer for a few rands per half-hour. Metro-rail still do not have wifi on their trains. It is like being the last person on earth after the flood. The problem of too many Android apps, competing for precious storage space, the insanity of every company pushing out its own app, at the same time as palming off services into the digital realm, the real beneficiaries are the mobile technology providers. For a brief time I marvel at how everyone must be doing, walking around with terabytes of ram on their phones and tablets, but sadly, like most people, I only have 4 gb on my phone, Android Lollypop takes up most of the space of the Vodacom unit and this version prevalent in the third world, doesn’t like SD cards, and won’t let me expand. I am forced to call a hotline to access my health insurance which relies on its app to service customers, miraculously, they provide the line as a free service and I don’t need to load airtime.
DAY 42 I receive an SMS alerting me to a bill in the amount of R456.11, not only is the inhuman Telkom system billing me for a non-existent service, but they also have the wrong call plan. Prior monthly average has been R310, and the last bill was a credit for R10.93. I call a helpline, log a dispute and am told “the extra fees are for ADSL”, it appears Telkom have taken over the ADSL portion of my service without my consent. Seems as if the beast is unable to accommodate real people with real-life problems, and is instead introducing new problems of its own. I also get the sneaking suspicion that Telkom bills are all just a thumbsuck with no real bearing on usage. Am forced to leech internet (keep those passwords!). Pickup a telephone directory from the Post Office (remember those?), just so I can call my data service provider MWEB, alas, they are not listed in the phone book. Then remember that I have an Mweb helpline listed as a memo in a notepad on my desktop. Call them on a “sharecall” to explain the situation. I must first log a fault, then seek a refund for the two months I am without service etc etc. I swear many service providers make money out of ‘sharecall’ services.
At first I speak to the accounts dept, then the technical dept, and finally the “moving dept”.
Apparently I should have called MWEB to begin with. Why didn’t Telkom bother to tell me what was required? The confusion is all the result of an ANC SOE policy whereby Telkom is the monopoly cable operator, (these days in name only) but where third parties offer data services, a complete fibre-to-the-home solution lurks on the horizon, great if you end up getting bundled voice and data. Why has the beast unilaterally taken over my ADSL “line” (read “account”)? To make matters worse, there has been no communication from MWEB alerting me to any of this, (they are also billing) nor from Telkom for that matter. The latest glitch of epic proportions has all occurred because of the mysterious power wielded by faceless operators sitting behind anonymous switchboards and cold cathode computer screens. In all likelihood there is no connection between my past service and the new, as yet unconnected one. R50 later and I am still not at the bottom of it all.
The woman behind the helpful MWEB “move desk” is cut off, another victim of Vodacom extortion. (Mobile rates priced as if Euros, Dollars and Sterling were all benchmarked by an accountant whose life depends upon getting lattes on executive flights to Mauritius). Again, those sharecalls seem like wishful thinking when it comes to using mobile phones, an excuse to ramp up consumer spend. I miss the Pacific Bell sales pitch from my days in California, Friends and Family Are Free. Before Telkom had even considered broadband, there was a big bang in the USA. It revolved around breaking up Ma Bell, the one-size fits-all national telco into baby bells, all competing with each other. The result was the Dot-Com explosion. In South Africa, we had quite the opposite, a National Telco Monopoly that went from Ma Telkom to GrandMa Telkom. A dinosaur currently in its death throws. RIP Public Telephones. Yes Telkom exists as a mobile phone company, but its life as a cable company is numbered, like the sales pitch at RSA web suggest, fibre is coming at lightening speed, and its not Telkom who are making the offering to connect, despite similar offerings from mobile operators. Despite the seeming progress, there are still plans afoot to calf a “National Internet Service provider” out of two separate units, broadband infraco and sentech ), a case of fiddling while Rome burns and quite the opposite of what happened in the US.
Thus in Pretoria the bureaucrats in the Zuma administration still dream of building a Kremlin large enough to get lost in, and thereby eliminate the need to work, while another dept, plots its journey to the Sun, no worries, we will travel at night! I contemplate how a system designed upon a talking drum backbone and witchcraft would work? Am ready to start sending Morse Code, or Ham Radio. Do I begin constructing my very own “Net”, this time, starting with node to CTWUG? All cost money, we so dependent upon the Net that we have become strangled by it.
DAY 49 I receive the Telkom bill printed on chlorinated white bond. It affirms that Telkom have placed me on the wrong call plan and are double-billing for ADSL services already “supplied” by MWEB. I call MWEB, the technical dept agree with me, but a lady at the accounts dept wants to argue. I request to speak to a manager, instead she puts me on hold for so long, I eventually put down the phone and decide to write the manager a letter. Meanwhile USB stick is overwritten by a virus at a City Internet Cafe. Appears some Trojan posing as a Windows “driver” updater is merrily making copies of itself. After deleting all the .ink and cmd.exe files that propagated (and then reformatting), I inform the owner, who gratiously declines to accept payment. I relocate to the City Library, where there is at least a room filled with computers, and virus-free Linux. Better work conditions as a Micro-serf, means I get to attend an ISOC party.
DAY 52 Having penned three letters in the matter, and as many complaints, I finally receive a missed call from my landlord, I pay for the call to his golden mobile phone, to finally receive lordly permission for the wiring of the conduit to go ahead. Telkom technicians will be under supervision. I thank him profusely and also thank my lucky stars that at least I’m not a Telkom employee, — can’t live with them, can’t do without them. A light is at the end of the tunnel. People are singing the praises of the Digital Jehovah, the Internet Christ will Return.
DAY 58 An electrician from a frontline state arrives. Fairly decent fellow. According to him, it will take two days to pull the wire into the building. He appears to think the cable is simply two wires. I attempt to explain that the cable needs to be Telkom compliant and that my ethernet cable has six cores. I receive an email from MWEB technical dept complaining about my not informing their MOVE dept. (Oh, the fiction) I respond that Telkom are the ones providing the infrastructure and that I have simply relocated my MWEB router.
DAY 65 5 October I receive nasty email from MWEB claiming they are ‘merely a subscription company’ and thus not liable for any loss of service due to Telkom and them managing a non-existent line. Letter goes on to explain that they can’t refund me any money, even the “subscription” for the entire month of October (Read: We don’t care a damn about our customers as long as we getting their money!)
9 October SMS Dear Mr Lewis, a dispute has been created on your account ref: 28437870 we apologise for the inconvenience and will endeavour to resolve your dispute as soon as possible, Telkom.
SMS Telkom Technican: U can take it up with them cause the job from a technical point is done. Let them know that the line is on the premises but not in ur flat due to renovation. (So much for the guaranteed installation of a fixed point inside my home)
12 October SMS Good Morning Mr D Lewis, dear value customer, you have your Internet/DATA with another service provider however your ADSL Speed Facility is with Telkom SA. Please contact your service provider to contact Telkom SA so that they can port ADSL over to them. So in mere fact you pay DATA with them and ADSL with Telkom SA. Current account of R456.11 outstanding.
DAY 79 19 October still no connectivity. However a paralegal is attending to mediation with my landlord, and an attorney via legal insurance is apparently dealing with Telkom. There is no sign of the electrician from a frontline state. I meet one of my neighbours who is paying some R150 extra to Skype, just so that he can have an 021 number. I ask him if he gets free unlimited nation wide calls to RSA telephones, he appears to grimace, but I get invited for a braai.
DAY 81 I receive a bill from Telkom, this time I owed them R843.85 for a non-existent line where the telephone number has not yet been issued.
Herewith my experience attempting to relocate a Telkom line, Ed.
My first call to the Telkom operator from the line that is going to be relocated is unsuccessful, thus beginning a series of similar unfortunate phone calls. Each time I am asked by a machine to enter the number I am calling about and also my 13 digit ID number, only to have to repeat this information verbally to the operator, a case of pretending to be in the information age?
I explain that I am moving from Woodstock to Muizenberg. I give the exact street address and room number of the apartment, a duplex near the Beachfront. The person tells me the address is on google maps but not on the Telkom system. I need to give the ‘name’ of the apartment, she says. I tell her, I don’t know the exact name, but surely the street address and room number will suffice? She puts the phone down on me.
I arrive at my new address, and call Telkom again from a mobile phone. After about 40 minutes on hold, with an obsequious rich voice assuring me that I am being attended to, I give up, (It seems Telkom have two voices, one when soliciting services and another when demanding money — that irritating old apartheid Tannie must work when it comes to bad debts).
Next call I eventually get through after 20 minutes. Each call consumes an enormous amount from my capped mobile contract. There is no toll free relocation number to assist persons such as myself. No attempt to finesse the plight of those unfortunates wishing to relocate. I duly give the details of the apartment, including its “name”. “It’s a totally different area, says the operator, you will have to get a different number.” Fine I say, when can you relocate the service? I am told the relocation will take up to 7 working days.
Wishful thinking, after the expiry of this period, I call Telkom one again, only to be told that the relocation can take up to 21 working days not including weekends.
DAY 16, I get an SMS arranging a morning appointment, enter @yes or @no. I sms my acceptance. D-Day arrives, beginning with an early morning sms addressed to Dear Customer, ‘a Telkom technician has been dispatched to install your telephone line for your order today, your continued support is appreciated.‘
By mid-morning I am beginning to not appreciate. By midday I am positively livid. Then I receive a mobile call from the “technician”, a person apparently contracted by the company to install my line. ‘I was at your address in Woodstock this morning’ he says, all Gung ho. “You weren’t there.” I explain that he has attempted to reinstall my line at my old address, and that I am in Muizenberg not Woodstock. “That’s the order I got. Its a totally different area he says.” I tell him that his company appears retarded. He puts down the phone and I don’t get an opportunity to question him as to why he didn’t call first thing in the morning. I suspect that he is simply happy to get paid a call-out fee without doing any work, a new loophole being exploited by outside contractors, that are also rife in the insurance industry.
Thus at the end of the day I receive yet another Dear Customer SMS, assuring me that a technician has been dispatched, no such luck, except for the lucky fellow who has now probably billed the company twice.
DAY 17 AM, I call Telkom, am once again asked by a machine to enter the number I am calling about and also my 13 digit ID number, only to have to repeat this information verbally to the operator, before being referred to another person for assistance. I barely have time to repeat all the information once again, before my mobile phone cuts out, victim of diminishing finances.
What strikes me is how the supposed digital sophistication of the company is turning out to be a highly complicated, analog affair, as if kilometres of copper cable would need to be hauled from one suburb to the next, merely to accommodate a simply change of address. The same obfuscation is apparent in the world of plumbing where a simple hot water geyser, basically a large kettle, is turned by a trick of the imagination, into an ancient steam engine necessitating the attendance of a team of engineers in the minds of the victims of the charlatans of the profession.
Walking on the street on the way to recharge my mobile, I notice a man working on a Telkom cable box. I ask him what he is doing, apparently he is an apprentice. Soon a technician arrives in a van. I relate my tale of woe. He asks if I have the order number. He makes a note and takes down my mobile number. He says in all likelihood the other technician won’t get paid. Will he help me?
There was a time when Telkom was a purely analog company, replete with switch boards and physical switching of calls. One could call an operator to place a collect call, while the post office handled telegrams, the antecedent of email and sms. Then the Internet and the Information Age arrived. Instead of rebooting, the company carried on providing copper cable, assured of its monopoly on telephony, a mantra of the volkscapitalisme under the old National Party, a socialist status quo which continued under the ANC, only to see wireless operators and the invariable march of progress and free enterprise, beat it to the punch in terms of sheer numbers.
South Africa has a history of late adoption of technology and, aside from cellular, Telkom is no exception. After killing off Internet dialup services the company begrudgingly offered broadband in 2005, some 20 years after the technology and the Internet had caught on in the West. For two decades the only form of Internet enjoyed by South Africans was thus to be had via Internet Cafes and exorbitant cellular contracts that really take the joy away from surfing. Then Telkom shifted into wireless and also listed on the JSE, an example of a ‘hybrid SOE’ with both government and private investors, punting hybrid technology while seeking to compete with the new wave of optical networks. As I write this, there are now various offerings of fibre cable by the three big mobile operators, (Cell C, MTN, Vodacom) and all are pretty expensive in comparison to copper. So far as price is concerned, Telkom’s offering is cheaper by yards. Technology such as G-Fast has extended the lifespan of copper.
The cost of delaying the inevitability of the Information Age, and the need for competition, has been a loss of economic activity and productivity that spans a generation. For South Africans champing at the bit, it is the ANC and SOE Minister Lynne Brown who needs to take responsibility. Like the Nat Minister who famously opposed the introduction of Television, Brown has consistently punted the anti-technology, anti-Internet views of the labour-left coalition governing the country, at the same time as claiming to be rolling out services, part of the talk left, walk right approach which has dogged the party. (Who can trust the party these days?)
While mobile networks connected consumers to the new world of Android and Google Apps, it is fibre cable which holds the promise of allowing consumers to turn into providers of information, while bringing IT capacity to small businesses seeking to compete on the international stage. South Africa’s digital economy is still in its infancy, and the cost of retarding growth for purely political and ideological reasons has demonstrated that when it comes to labour rights, one may want a dash of Marx but when it comes to a flagging economy, what you really need are economic theories based in the here and now, geared to the problems of the day, not the 19th century.
DAY 17 PM Once again I get through to an operator. According to her, my order of 1 August is not on the system, but technicians ‘were at my premises yesterday’ she says, sadly the order was, surprise surprise, cancelled. She promises to follow up, to see what happened. I tell her that aside from the internal inquiry in the company (and a potential suite for damages) I still need my service to be installed at my new address as guaranteed. Since the company is an SOE, liability is restricted. I probably still have a shot at a complaint to an Ombud, but there is precious little I can do to stop the behemoth from needlessly damaging my own business. R50 airtime later and I am once again cut off by Vodacom, which appears to eschew calls to other operator service numbers. Calling service numbers is a bit like playing slot machines in R20 increments.
Never fear, the mobile counter at Checkers offers various SIM packages with free connectivity deals, there is Vodacom’s Free Facebook connect, and a Cell C free for R12 Whatsapp deal. But no free service numbers across networks. No allowance for error on anyone’s part. Then there’s the fine print, in order to purchase a new SIM one needs to RICA the SIM, and in order to comply with the legal result of the USA Patriot Act, renamed The Democracy Act in South Africa and all resulting from a suite of post-911 global Anti-Terror and Anti-Money Laundering legislation, one needs to provide paperwork such as proof of address on the off-chance I might be spying on my government, or part of an international terrorist syndicate. If adult persons such as myself find it hard going getting connected, what about pensioners and the infirm?
The 20 year one-horse cable race provided courtesy of the ANC reminds one of the joke about flogging the dead horse. A committee has been appointed to inquire into why the dead horse is not doing its job.
DAY 18 I go into town, recharge, only to have mobile data suck my account dry. Neglected to turn it off, me bad, buy hey why is the default plan always pay, pay, pay? I get to a Telkom outlet, only to speak to a Tony Ehrenreich lookalike, replete with golfing shirt. He claims he can’t help me, since “this is a Telkom mobile outlet” and “we’re a mobile company”, but nevertheless puts me on a free line to a helpdesk. I speak to the operator, assured that my precious mobile units are not being eaten. The operator is adamant that the address where my new line is to be installed is in Woodstock not Muizenburg, I ask her if she is perhaps a foreigner? No, she says she grew up in KZN. Never been to Cape Town? No. Never studied geography? No. ‘Cape Town, its a major a metro, you should visit Muizenburg sometime, you would like it,’ I say. She duly completes yet another reorder and issues a reference number. I get home only to open my Telkom bill, to find there’s an offer of a ‘free cordless phone, our housewarming gift to you,” in fine print at the bottom of the damn thing. To receive it, I would have to apply for a relocation online. Is this all just a perverse case of reward and punishment? The corporation is punishing me for not applying for a gift, via the appropriate channels?
DAY 21 I receive yet another chummy “Dear Customer” sms, this time thanking me for ordering a telephone service for my new address. Apparently my “order” is receive attention and further communication will follow. The sms thanks me for choosing Telkom. “your service provider”
DAY 24 I am admitted to the online club of fuming Telkom users, each one with a jarring story to tell. There’s the guy whose service failed, who then upgraded to a 20mb line, expecting better service for more money, only to find he was now being billed for a service unavailable to the area he lives in, and to make matters worse, he is now blacklisted for refusing to pay up. Or the customer who got told Telkom don’t install cables in ‘black townships’ due to supposed cable theft. (whatever happened to fibre to the curb or fibre to the home?) Or the lady whose four year saga involving payments and no-service really takes the cake in terms of limited liability and refusal to abide by a government decreed service mandate, one of many election promises made by the ruling party. A litany of complaints involving failure to repair lines, even in popular metro areas. The abuse of debit orders. A culture of ineptitude and buck-passing, and abdication of responsibility.
As the Peter Principle dictates, ordinary people will always rise to their own level of incompetence. See this article on Von Mises theories on bureaucracy.
DAY 25 Am considering building my own telco. Another SMS arrives, this time with a more serious tone: Dear Client, Telkom will send a representative to your premises to fulfil your request … we have scheduled an all-day appointment for Monday. That’s right, an all-day appointment productivity sink. The company also demands various documents such as a certified copy of my ID. So much for being a loyal customer. Or perhaps they’re just concerned I may have changed my identity in the past 5 years that I’ve been getting service from them. Enough time to take those hormone shots?
1) Fire No 1 and pay back the money
2) Cut back on five hour lunch sessions, R1bn wagyu steaks for No 2
3) Dump the Gupta Raj and the British East India Company kickbacks.
4) Reduce size of cabinet to pre-Zuma levels
5) Break up SOEs into smaller units, sell SAA.
6) Dump Eskom and introduce an Energy Commons
7) Introduce a Social Wage for all (including Basic Income Grant)
8) Household responsibility to provide home economics
9) Income equalisation for periodic work
10) Rent Stabilisation for those renting
11) Compulsory Civics classes for young scholars and new immigrants
12) Adopt David Robert Lewis’ Electronic Freedom Charter
13) Celebrate the Earth Rights we got into the Constitution
14) Hire competent staff at finance ministry
TWO parties, each with contradictory and competing visions for South Africa’s future, hold centre stage. In the one corner, the African National Congress with its legacy of struggle against apartheid and nation building, that has increasingly come under the spotlight with revelations of corruption and state capture, and the failing economic policies and antics of its president Jacob Zuma
In the other corner, the Democratic Alliance, an opposition political formation with market friendly policies, but hampered by a troubling legacy, fraught because of its historic support from white capital versus the emergence of black capital under the ruling party, and yet presenting a different vision of reconciliation, inclusion, and equal opportunity.
So far as DA leader Mmusi Maimane is concerned, the struggle is about keeping the reconciliation project alive while creating an open and inclusive society in line with a constitutional vision that is the antithesis of the creeping totalitarianism and authoritarianism of the current administration.
Over the past months, the ANC has diverted itself from the proud nation-building of past administrations, towards an increasingly tribal vision of a society not unlike the Bantustans of the apartheid-era. A country defined by race, where domination of one group by another is the order of the day, and where expropriation of land without compensation is matched by the growth of state and tribal authorities.
And yet within the ANC itself, there exist competing visions to what has been broadly condemned by the investment community as “Zumanomics”, an unworkable recipe for economic disaster. Thus a lively debate on so-called ‘radical economic transformation’ has ensued at the party’s organising conference.
So far as ANC NEC member and Minister of Police, Nathi Mthethwa is concerned, “South Africans should focus less on the colour of monopoly capital and rather focus on contesting monopoly capital in all its forms”
“We shouldn’t be aspiring to change white monopoly capital to black monopoly capital. The uncompetitive nature of monopoly capital makes us raise an issue of contestation, whether it will be black or white,” Mthethwa told reporters during a media briefing this week.
It was party spokesperson Zizi Kodwa who thus also articulated a view that is in direct contrast to the DA faction under Helen Zille and seemingly the ANC under Zuma. According to Kodwa, “the new South Africa creates a clean break from our ugly past giving birth to a new nation with new prescripts. South Africa is not an improved version of the past or a case of taking our better past forward, South Africa is a new nation.”
Can the DA match its own rhetoric and the propaganda of the ruling party, with a victory at the polls? The alliance has seen major victories during the past general election in several of South Africa’s metro’s including Johannesburg, and Nelson Mandela Bay. As the ANC moves to reduce its opposition to the left, it invariably risks losing the middle ground, where the most votes in the next election are bound to reside.
Thus as the party erodes the opposition EFF base, whose red shirts are now ironically being deployed in support of the DA — the ANC policy conference and its adoption of far-left language, risks reducing the party’s central mandate as articulated by the NDP and will come as a blow to those arguing for moderation.
All good news so far as the DA is concerned.
WHEN the electric icebox was invented, thousands of ice haulers went out of business. At the turn of the 20th century, nearly every family, grocer, and barkeeper in South Africa had an icebox. But ironically, South Africa’s dependence on ice created the very technology that would lead to the decline of the ice empire — electric freezers and refrigerators.
During the early 1900s, these appliances became more reliable, and by 1940, millions of units had been sold. With freezers allowing people to make ice at home, there was little need to haul massive quantities across the country.
We can’t stop progress and if we do, we risk losing far more than jobs, our Earth and our human habitat is at risk. Because of altered circumstances, Eskom has decided to shut down five coal power stations — Hendrina‚ Kriel‚ Komati‚ Grootvlei and Camden. The termination of coal truckers contracts has lead to a furore, with Cosatu labelling it a “hostile act”.
We can’t turn back the clock. This is not simply about Independent Power Producers (IPPs), as 250 medical professionals and medical organisations stated in the Durban Declaration, climate change is a medical emergency. According to the Lancet, climate change is the greatest global health threat of the 21stcentury.
Each year has seen an increase in global ambient temperatures caused by the release of Greenhouse Gases (GHG) associated with carbon and fossil fuel such as coal, with the resulting melting of permafrost and the polar icecaps, retreat of glaciers, thermal expansion of the ocean and most indicators are off the charts. Africa will suffer most from increasing temperatures. Workers will be most affected by associated loss in productivity.
We can’t afford to live under domes with an altered climate, neither can we afford to miss out on the renewables revolution. Far from being a scourge of privatisation, it is one of our country’s few success stories, continuing to attract investment, continuing to produce jobs and the roll-out of renewable energy is very impressive. It represents a paradigm shift, we dare not ignore.
A way must therefore be found to accommodate the major shift in energy priorities and the sudden dislocation of an entire industry. Truckers can truck goods in other markets, we must assist them, but we cannot step back from the icebox analogy and the melting point — we really no longer need a coal trucking route, nor a coal industry and its cost in terms of human life.
One can only suggest Eskom needs to be more strategic in its approach and truckers need to given the resources to regain control over their lives. Government must assist in skills retraining and investing in adult education that will help families deal with the crisis. It must not be mislead by the unscientific opinions and haranguing of union bosses.
Extract Published in Cape Argus, Letters 9 March 2017
PRAVIN GORDHAN found a sneaky way to avoid raising VAT and it isn’t healthy. Promoted as a health tax, the sugar tax quickly snowballed into an all-out tax on anything sweet, including dividends.
The problem with the finance minister’s health claims, is that they don’t hold up to scientific scrutiny, for starters, South Africa is a major fruit producing nation, and in the battle between fast food, sugared drinks and cola’s, the beneficiaries have invariably been the export fruit market and consumers overseas.
Now with a whopping 11% tax on sugared drinks being extended to literally everything, including ‘intrinsic sugars’, read 100% fruit juice, the health alternative is going to be even more out of reach of the poor, as well as pensioners, who are expected to consume what?
And to live off what, five and dime spaza stores?
There is a major and significant difference between the active ingredients in all these products, financial, health or otherwise.
Fructose found in fruit breaks down in your liver and doesn’t provoke an insulin response. Glucose found in cola drinks starts to break down in the stomach and requires the release of insulin into the bloodstream to be metabolized completely. Fruit juice contains plant phenols and antioxidants, while ordinary sugar drinks do not.
Conflating the two, like the conflation of dividends and the banks who dish them out, will prove to be a costly and unhealthy error by the treasury.
For years, the sin taxes authored by treasury have targeted alcohol and alcohol drinkers, driving the beer market at the expense of more refined and hardtack liquor. Now with sugar in its sights, treasury has found a convenient scapegoat. Taken to its logical conclusion, we are likely to see a hit on fresh fruit and the proverbial fruit tree itself, which may feature alongside sweets and chocolates, and milk products, in future budgets.
Talk about taking popsicles out of the hands of children, but this is exactly what Mr Gordhan has achieved this year.
The reason why budget 2017 is hugely problematic, more so than any previous budgets, is because of two vectors:
The first, is the ANC and its ‘tax and spend‘ strategy which has resulted in a budget deficit and resulting need to service debt, the cost of which runs at an enormous R162.4 Bn. According to reports, this burden is not projected to come down any time soon, and can only get worse.
Far from austerity and prudence, the budget is rather shy when it comes to trimming spending. To give you an indication, this interest figure is almost the same amount of money the government spends on healthcare each year, projected to be R187.5 Bn.Then there is the enormous burden placed upon individual taxpayers, who must feel a bit like victims of a hit and run.
Personal income tax in South Africa is currently in an alarming disproportion to income tax generated from corporate taxation. Private taxpayers thus contribute almost 2.5 times as much as corporations, the figure grows to 3.6 times if one adds VAT and even more when one considers the fuel levy.
This trend is global, as more corporations hide behind tax havens, while ordinary citizens increasingly fork out more tax to cover the deficit.
The state will continue feeding SOEs such as ESKOM and SAA in the dirigiste economics that has become the hallmark of the ruling party. Tax on road transport has increased via the fuel levy. On a brighter note, the government intends to roll out new trains and public transport services. One can only remark on the contradiction between the national airline, and the rail agency.
NOTE: At writing this, there was no clarity from the media on whether there is a current exemption for fruit juice or not, and exactly how the new intrinsic sugar regime is being implemented. Health24 reports that fruit juice is included while The Herald reports that the deputy director-general Ismail Momoniat has told journalists that ‘Treasury proposed to introduce a threshold that would make the first 4g of sugar per 100ml beverage exempt from the sugar tax. He said 100% fruit juices and milk products would be exempt.’
RECENTLY the Wall Street Journal ran a series of articles, celebrating the country’s 250th birthday and dedicated to shaping the future . What would the America of 2026 be and how would the nation arrive there? Suggestions ranged from infrastructure investment, gender equality, taking charge of climate change, respect for nature, the rise of the millennials, rekindling the revolutionary spirit of 1776, deregulating the Internet, breaking government gridlock, and more competition.
We think South Africa could do a lot better than simply following America’s example. As our country reaches the 20th anniversary of the signing into law of our Bill of Rights in December by founder, Nelson Mandela, we invite readers to submit their proposals for a better future to Medialternatives. What will the next 20 years be like, what will it take to get there?
Below are a few suggestions with regard to reform.
Providing greater access to justice for ordinary citizens by capping legal expenses. Creating a more inclusive justice system by placing the Constitution as well as citizens interests as paramount — extending the role and practice of lay assessors –providing the option of a jury in capital crimes and defamation cases. Greater accommodation of the public interest through broader media access and reporting. Greater independence by ending the abuse by law firms of proxy judges i.e the acting judgeship system, and giving greater independence to civil institutions such as the public protector.
Putting a stop once and for all to the legacy of apartheid economics, monopolies and spatial development. This would entail chopping SOE behemoths into smaller, manageable units able to compete with each other. Creating an energy commons that allows for independent energy producers as well as smart grids. Ending Telkom’s home cable monopoly –allowing landline operators to compete, especially in the broadband sector. Allowing innovative commuter services and competition in rail transport. Selling ailing SAA and ending the annual bail-outs of the apartheid era airline.
Correcting the mistakes introduced by our proportional representation system, by making MPS more accountable to their constituency. This may entail a combined ward and roll system whereby MPs without sufficient local ballots are prevented from succeeding purely by the roll system. Tightening the rules around campaign funding, making MPs more accountable when it comes to disclosure of assets and implementing rules on state capture. It should be impossible for large corporates to exercise undue influence over the nation’s political representatives.
A nation which focuses on improving itself through free education, lifelong learning, youth empowerment, access to learning materials, language labs, computers and other tools, correspondence courses, video materials and study aids — all forming part of guaranteed access to education . Broadening education to include life skills, home economics and equivalent assistance for all households and citizens. Introducing civics classes to provide a sense of national belonging for all citizens, whilst promoting understanding, continuity and access to civil structures and institutions.
Placing distributionism at the centre of our social welfare system. The country should be run like a benevolent corporation responsible to its shareholders. The president is merely the chairman or cheerleader. Profits should be disbursed to all citizens on an annual or biannual basis. This could form part of an unconditional basic income (UBI) paid to each and every adult irrespective of race, class, colour or creed. Supported by a market economy that coexists alongside social welfare.
Improving public health provision. Raising the number of doctors per person to first-world levels. Providing benefits or incentives for citizens to access private healthcare, in a duel system. Taking a preventative and complementary medicine approach to solving some of South Africa’s health problems. Promoting sports, nutrition and access to recreational facilities. Providing open air gyms, holistic care that includes therapy such as yoga, martial arts and art.
Retrieving our earth rights, those groundbreaking environmental rights guaranteed in our constitution but diminished under successive ANC administrations. Returning the values of NEMA and other environmental legislation.Treating nature as infrastructure for future generations. Creating green urban zones, parks, nature facilities. Placing ecology at the heart of ecological sustainable development. Lowering climate footprint. Reduce, reuse, repurpose, recycle, repair. Providing bicycle share schemes, boosting EVs and lowering impact of industry on nature.