South Africa is, like most countries, facing public sector challenges in an environment signified by rapid change. Tei Werth looks at the complexity of the South African innovation system and the various challenges South African policy makers are facing right now. She compares these with the Nordic model.
Tei Werth, Development Economist, South Africa
Global Progress on Innovation
IGI Global states that the growing complexity of innovation has led to a transition to an open innovation approach.1 Open innovation refers to an increasingly popular approach to business promoting collaboration with people and organizations outside the company and absorbing external knowledge into the company’s ideas, new technologies, trends and business models or gaining new approaches to launching a new product or service to grow the market share. Open innovation is now a widely used concept in academia, business and policy making.
This growing success of open innovation practices in the business sector raises the question whether these principles can be transferred for a reinvention/reengineering of public sector organisations.
Dennis Hilgers & Christoph Ihl go beyond a technocratic e-government paradigm in their paper “Citizensourcing: Applying the concept of open innovation to the public sector”.2 The paper provides a structural overview of how external collaboration and innovation is possible between citizens and public
administrations. The aim is to offer new ways of citizen integration and participation, enhance public innovation and – even – enrich the political decision-making process.
“Citizensourcing” is a way to apply open innovation to the public sector. One of the current key trends is digital transformation. Here the key challenge is uncertainty. EU funding programs represent a potential funding solution.
The Whac-A-Mole System: A Metaphor for Comparing Innovation Versus Reacting to Crisis/Opportunity Only
The Whac-A-Mole entertainment vending machine, which originates from Japan, can be used to describe social and political systems. The term “whac-a-mole” is used in informal conversations to describe a situation that is recognised by a series of repetitious and futile tasks. The multiplier effect of completing one task (hitting a mole on the head with a hammer) leads to another mole popping up somewhere else.
This metaphor leads to a question: ‘Regarding innovation and innovation policy, are we dealing with real issues and real solutions or are we merely whac(k)ing-the-moles?’
Innovation in South Africa
South Africa’s innovation policy functions within the framework called the South Africa Constitutional Democracy Model. The study A Systematic Review of The Features of The Nordic Model and Lessons for South Africa (Werth, 2022) identified certain variables that do have an impact on innovation and innovation policies.
The purpose of this study was to historically explore key features of the Nordic/ Swedish model from a South African perspective, including the barriers and enablers South Africa can address in order to contribute to a more just and inclusive society.
In 2013 The Economist acknowledged that the Nordic Model is regarded as a well researched and highly ranked social model globally. It has been identified as the next “super model” and a benchmark for others. The Nordic Model refers to the combination of social welfare and economic systems adopted by Nordic countries. It combines features of capitalism, such as a market economy and economic efficiency, with social benefits such as state pensions and income distribution. The Nordic Model is seen as a combination of equality, well-being, competitiveness and innovation.
Against this background, the history and features of the South Africa’s Constitutional Democracy and the Rural Development Framework, including its development state perspective, was explored.
The review of these two models made it easier to understand the “cultural” environment in which innovation and innovation policy operations take place. This insight can be used to postulate lessons learned for South Africa.
This study focused firstly on education and healthcare for women, to clarify how education and healthcare as part of South Africa’s legislative framework measure up to the Nordic/Swedish Model. In this way the aim was to identify disparities and disconnects.
Secondly, the study looked at the impact of land rights/access for women (legal rights relating to women’s ownership of land) in both Sweden and South Africa.
It is important to note that the alignment was not necessarily between South Africa’s Constitutional Framework and the Nordic/Swedish Model per se, but between the barriers and disconnects in the South
African system and key elements found in the Nordic/Swedish Model.
The results showed that the full institutionalization of policies (education, health, land rights and gender justice) is vital if the intention behind the South African Constitution is to translate into a more just and
inclusive society and practice. Disconnects between the Constitution and government policy, as well as tribal custom and practice, specifically regarding gender concerns, landownership and land access need to be resolved/ minimized.
South Africa needs an innovative approach by which women and the youth can gain access to capital and land. Given prevailing discriminatory social-cultural forces, gender equality and justice in the South African environment needs to be reasserted.
The study did not focus on an ideology, but on the underlying factors which could enable South Africa to achieve social, economic and resource justice and inclusivity within a development context. The findings of this study could contribute towards a more comprehensive layout of a just and inclusive initiative for South Africa, as well as a new look at innovation and innovation policies in South Africa.
South Africa’s Influencers 2023
South African innovation policy learning does not take place in isolation. There are many institutions and processes that influence policy thinking and policy development.
Trade and trade agreements are among the economic mechanisms that connect the world. South Africa’s biggest trading partners are the European Union (EU, 2021, totaling trade US$38 billion) and the United States (US, 2021, totaling trade US$16 billion). South Africa is politically tied to the emergent multipolar world led by China, and broadly BRICS.
The EU’s perspective is that innovation policy plays an increasingly important role in the economy. The European Commission argues that innovation will benefit EU consumers and workers and maintains that
innovation has the capacity for building a greener society, in this way improving the quality of life of its citizens. It sees innovation as the key to competitiveness in the global markets.
Innovation policy is the crossing point that links research and technological development policy with industrial policy. The aim is to create a framework to assist in getting ideas to markets. A more recent objective is global security, a need that became more prominent with Russia’s invasion in the Ukraine.
A global trend in government innovation is the reference to a “permacrisis”, in the sense that governments must continuously cope with and respond to emerging threats, in addition to facing longstanding issues such as digital disruptions, low levels of trust and climate change.
Global Influencers
South African policy making and political discussions are influenced by several global events and actors. Among them we find:
The BRICS Summit, Johannesburg, South Africa, August 22–24, 2023
The theme is: “BRICS and Africa: Partnership for mutually accelerated growth, sustainable development and inclusive multilateralism.”
The BRICS countries (Brazil, Russia, India, China, and South Africa) have 41.5 per cent of the global population.
The New Delhi G20 Leaders’ Summit, India, September 9–10, 2023
The G20 grouping comprises 20 countries cutting across continents and the European Union, and account for two thirds of the global population, representing around 85 per cent of the world’s economic output and 75 per cent of world trade between them. The theme of India’s presidency is “One Earth, One Family, One Future”. South Africa will be taking over the G20’s presidency, for the first time, in 2025.
Two other summits that have impact on South Africa are the 36th African Union (AU) Summit, and the G7 Summit in Hiroshima, Japan. These have already taken place.
The South African government is also influenced by analyses and policy proposals developed in other countries and international organisations like the EU and the OECD.3
Internal Influencers
The following are a few of the internal factors that currently influence both public innovation and the innovation policy of South Africa:
Elections in South Africa
South Africa has been in election mode since the first democratic election in 1994. That election resulted in a revolutionized and politicized socio-economic jostling that is literally taking place on a daily basis. South Africa has elections approximately every two and a half years and it creates many challenges, instability, and systemic problems.
Patric Tariq Mellet argues that the 2024 elections may lead to constitutional crises and civil unrest, due to the fact that there is no regulation or other provision made for a hung vote. This could lead to a hung parliament and a hung Cabinet. The two major scenarios are either a political alliance or coalition between parties or a third option which will not be discussed here.4
Systemic problems in the public sector
South Africa’s longest-serving political columnist William Saunderson-Meyer expands on his recent op-ed where he argued that Eskom-related5 power cuts are a sideshow compared with the homeland’s everescalating crime rates.6
The reason for surging malfeasance, he believes, is found in the criminal justice system – from policing to the courts through to prisons. He sees an ocean of incompetence with zero consequences.
One of the failures, part from the crime intelligence failure of the SAP [the South African Police Service], has been the system’s inability to provide community service. This leads to an environment for vigilante groups causing more swift and brutal crimes.
The problem seems to be malfunctioning institutions. The key is responsibility. No one takes responsibility, and no system can operate efficiently without a sense of responsibility. An example is the massacre of mine workers by police at Marikana. No one, including the Chief of Police, had disciplinary charges and no prosecutions came out of this.
Is this fixable? Saunderson-Meyer says one has to remain optimistic. One does what one can and one hopes. In 1994 we had a confluence of extraordinary international and national circumstances combining with great good will in South Africa. Truly seminal.
However, it has become more and more difficult to fix the problems South Africa is facing now, because there are more and more things to reverse. Rot at the lower or top end of an organisation becomes a pervasive rot. Society can survive, but can a society flourish under such circumstances? In South Africa’s case, we are looking at 5 to 10 years to pick up the pieces.
A comparison with the Nordic model throws light upon the need for political stability, trust, responsibility and transparency.
Is South Africa innovating or just whac(k)ing the moles?
The ruling party, the ANC, introduced a revolutionary strategy of cadre deployment which exacerbated the situation regarding responsibility and accountability at national, provincial and municipal levels. In general, the South African political landscape has changed. Many “moles” have started to pop up – from state capture to mismanagement of state owned enterprises (SOEs). South Africa’s government has lost billions of rand due to crime related ventures. Post-Covid 19 shows fault-lines that are surfacing in both the public and private sectors. A few examples are:
The cost of C19-related corruption
According to the “Third Final Report” on the Special Investigating Units (SIUs) investigations, conducted between 1 July and 31 October 2022, R8.8 billion have been probed in C19-related corruption. The effectiveness of the SIU’s investigation will ultimately depend on the willingness and capacity of political
and anti-criminal authorities to vigorously pursue its recommendations.
South Africa Post Office (SAPO, SOE)
SAPO destroyed R9.2 billion in shareholder value in three years and is now facing bankruptcy. There had been a significant decline in the value of the entity over the last three years. In 2019 the enterprise had total assets of R16.07 billion and total liabilities of R10.88 billion. SAPO is now technically insolvent with total liabilities exceeding total assets by R4.08 billion.
ESKOM (SOE)
Nelson Mandela Bay has been hit by blackouts and lockouts as massive corruption probes started and resulted in the suspension of seven officials in the Electricity & Energy directorate for their possible involvement in fraud and corruption. According to the Mayor, this leads to the biggest corruption scheme in the history of the administration.
When the large substations in Coega Industrial Development Zone exploded, the workers vowed to shut down the city to protest the suspension of their colleagues in the metro’s electricity department, and the electricity call center was also blocked. There was a further damage, estimated to R40 million, leaving factories and businesses in the area without power. A preliminary investigation showed that the network had siphoned millions of rand from city coffers in the last couple of years. The Hawks7 and SIU8 are investigating these matters and hope there is swift progress.
Governments have the capacities for resilience and demonstrated adaptation and innovation despite the compounding challenges. Ongoing crises catalyzed public sector innovation and reinstated the critical role of the state. The overall tone may be pessimistic although innovative initiatives do provide room for hope. OECD9 identified trends that assist willing governments to overcome obstacles and to ensure the wellbeing of their citizens and residents.
Conclusion
While we have given a perspective on some of the real issues and on the pervading policy practice within the context of South Africa, it may be of interest to look at the practiceof innovation and innovation policy in the First World in general and the Nordic countries in particular – are they dealing with real issues and real solutions or are they also merely whac(k)ing-the-moles?
Masters Title: A Systematic Review Of The Features Of The Nordic Model And Lessons For South Africa (2022).
Further reading and watching
Photo of Cape Town by Jetliner Images
Notes
1 https://www.igi-global.com
2 https://core.ac.uk/download/pdf/36548271.pdf
3 South Africa is one of five Key Partners to the OECD. South Africa has also a National Advisory Council for Innovation (NACI).
https://www.naci.org.za/
4
5 Eskom Hld SOC Ltd is a South African electricity public utility.
6 https://www.youtube.com.watch?v=CGzAjZgjB4o
7 The Hawks are the South African Police Services’ Directorate for Priority Crime Investigation (DPCI), which targets organised crime, economic crime, corruption, and other serious crimes.
8 The Special Investigative Unit. The primary mandate of the SIU is to investigate serious allegations of corruption, malpractice and maladministration in the administration of state institutions.
9