Case Against Youth Wage Subsidy

Implementing a wage subsidy is not without associated costs – or negative spin‐offs. The first of these is the so‐called ‘deadweight cost’, i.e. firms would have hired the now‐subsidised workers anyway. Thus, the full amount of the subsidy is ‘wasted’ and becomes merely a transfer from government to business.

The second cost is associated with substitution – existing workers may be replaced by subsidised workers. Business may also feel more encouraged to employ younger subsidised workers instead of older non‐subsidised workers.

Thirdly, the subsidy could lead to a situation where businesses with access to cheaper subsidised labour could potentially displace business that do not have access to cheaper labour, thus resulting in job losses and unfair competition. The fourth cost is associated with stigmatisation.

It is argued that business may interpret a subsidised worker as having certain characteristics that make them less desirable. It has been shown that where the subsidies have been applied to targeted marginalised groups, such subsidies have been less than successful. Lastly, another potential negative spin‐off could arise because the subsidy may distort the way people approach employment opportunities. For example, a subsidised worker may believe that he or she only has a chance of employment if it is subsidised; and youngsters may decide to leave school earlier, believing that a subsidy will ensure them employment.

There are, however, some strong counter‐ arguments to these objections. For instance, if the subsidy is administered through the tax system, it should be easy for the authorities to identify companies who are dismissing older workers in order to take advantage of the subsidy. It is questionable to what extent there would be unfair competition, as firms competing against each other would presumably have more or less similar labour requirements, and would thus benefit equally from the scheme.

As for the stigma, and the idea that young people may be induced to leave school early, a proper education and awareness campaign ought to address these concerns.

Bolts and Nuts - Youth Wage Subsidy

During his budget speech in 2011, Minister Gordhan announced a range of measures government would undertake to tackle the high unemployment rate – especially unemployment among the youth. One of these measures was an incentive scheme for firms called the ‘youth wage subsidy’ (‘the subsidy’), which was to be implemented by April 2012. The rationale for a subsidy was to make the hiring of unemployed youth cheaper for businesses which would not ordinarily have hired unemployed youngsters.

The subsidy would be administered by the South African Revenue Services (SARS) in a similar way to pay‐as‐you‐earn tax (PAYE). Those businesses which wanted to claim the subsidy must be formally registered with SARS, be registered on the PAYE and Unemployment Insurance Fund (UIF) systems, and have their tax affairs in order. 

All South African citizens between the ages of 18 and 29 would qualify if they were unemployed and then hired into a new job. In the first year government would subsidise 50% of the wage if the wage earned was less than R24 000 per annum, decreasing to 20% in the second year. The percentage of the subsidy would decrease progressively, reaching zero at the personal income tax threshold of R60 000. The subsidy would also have been made available to businesses already employing workers aged between 18 and 24. These workers would have been eligible for a subsidy for one year, at 20% of their wage if earning R24 000 or less, and tapering to zero at the personal income tax threshold.

According to the National Treasury 3 estimates, the programme would have subsidised 423 000 workers (at a cost of R5 billion to the fiscus), including 178 000 jobs that would not have been be created without the subsidy. It was further estimated that some 45 000 workers would drop out of the labour force after having benefited from the programme, so the net result would be 133 000 more people employed by 2015, when the programme would end. Furthermore, the National Treasury argued that each of these new jobs would cost approximately R37 000.4 Other estimates differed (according to Standard Bank, the cost per job would have been R27 900), but there was broad agreement that the subsidy would be far more cost‐effective than any other government job creation initiative.

The youth wage subsidy was, however, not implemented in 2012 due to opposition from Cosatu, which cited a number of contentious points (see below). The implementation of the subsidy was stymied as the negations between labour, government and business failed to find solutions at the National Economic Development and Labour Council (Nedlac). It seemed that government would not go ahead with the subsidy after the Economic Development Minister, Ebrahim Patel, brokered a youth employment accord at Nedlac which excluded a wage subsidy. However, during his 2013 budget speech, Minister Pravin Gordhan, announced that ‘a revised youth employment incentive will be tabled in the House [by July], together with a proposed employment incentive for special economic zones’. According to the Minister, the revised employment incentive has taken cognisance of the contentious points made by labour at Nedlac.

The revised version of the wage subsidy will now be referred to as a ‘youth employment tax incentive’ and it will retain many of the principles of the original wage subsidy. The final details of the incentive scheme are still not finalised, but it will operate through the tax system (as originally planned), with employers of qualifying employees paying less in payroll tax. The tax deduction would be up to 50% in the first year and 20% of the wage in the second 6 . An employer would be allowed to claim back an amount of up R1000 a month for every salary paid to targeted workers. The new youth employment tax incentive will also allow employers with operations in special economic zones7 to claim the incentive for new hires of any age.

Introduction - Wage Youth Subsidy

Introduction to Youth Wage Subsidy

Joblessness among South Africa’s young people aged between 15 and 34 is chronic and structural. The statistics tell it all: in 2011 almost three quarters (72%) of South Africa’s unemployed were younger than 34.

In 2010 President Jacob Zuma proposed a subsidy to firms to employ young people. In the 2011 budget speech Finance Minister Pravin Gordhan announced a youth wage subsidy in Parliament and set aside R5 billion for its implementation. Yet since then, the final implementation of the youth wage subsidy has been delayed and labour, business and government have been trying to thrash out their differences in the National Economic Development and Labour Council (Nedlac).

This paper will examine the youth wage subsidy proposal and how it would be implemented in South Africa. It will also briefly review the criticism levelled against the subsidy.

YOUTH WAGE SUBSIDY - JOB CENTRED APPROACH

Employment is vital for South Africa’s social, economic and political development. It is the key mechanism for addressing mass poverty. In addition, many other benefits flow from higher levels of employment. Many of the skills needed to improve a worker’s employability – punctuality, discipline, the ability to work with others, and so on – are most easily acquired on the job.

This is especially important in South Africa. Millions of people are the products of South Africa’s dysfunctional education system and have had few opportunities to acquire skills. For many, the workplace is the institution in which they are most likely to be able to acquire skills. Jobs also generate a sense of accomplishment, dignity and participation.

While welfare grants can provide a modest income, they cannot offer any of these other benefits, making employment growth vital to creating a more inclusive society.

As the National Treasury has stated, the proportion of working age adults with jobs may be the best measure of social inclusion in a modern society – far better in many respects than the Gini coefficient. On this measure, Brazil, where close to 70 % of adults have jobs, is a far more inclusive society than South Africa, where barely 40 % of adults have jobs even though levels of income inequality are similar.

If South Africa is to be more inclusive, far more people must find jobs, but what kind of jobs?

South Africa’s labour laws mean that any job that is fully compliant with the law is also, from an employer’s point of view, a reasonably expensive job. This is especially true when compared with the costs of employment in other developing countries. Minimum wages in South Africa’s clothing industry are two or three times higher than those for similar jobs in Swaziland and Lesotho, let alone India, Vietnam, Bangladesh and Pakistan. To justify this, levels of productivity have to be high, resulting in employers’ offering fewer jobs but for more skilled workers.

In recent decades the South African economy has generated fewer and fewer new jobs for every unit of economic growth. While some of this reflects increased productivity, much of the decline in job creation can be attributed to rising wages and increased labour market regulations, which have made employers more reluctant to hire workers, particularly those who are young and unskilled. Employers, who might be willing to incur the costs of employing highly productive workers with significant skills, are much more reluctant to do so for workers whose lack of skills and experience mean they will be less productive. This is a key reason why so many young, inexperienced workers are unable to find work.

While South Africa has sought to ensure that jobs are well paid and well protected, dynamic emerging economies in Asia have sought to expand the absolute number of jobs as rapidly as possible. Many of these jobs do not pay high wages or offer very good conditions of employment, but they do pay better than almost any alternative form of employment for unskilled people. Critically, they exist in very large numbers. Experience in Asia and elsewhere shows that once high levels of employment have been reached, productivity gains and progress up the industrial value chain lead to a rapid rise in workers’ incomes and quality of life. It also leads to much higher rates of growth for the economy as a whole.

This is the process that has lifted hundreds of millions of people out of poverty over the past 40 years. And, apart from the discovery of previously untapped natural resources, it is the only process that has ever improved the quality of life of large numbers of people in poor countries both rapidly and sustainably.

The story of Singapore’s rapid development is instructive. There, economic growth has generated a rapid change in its areas of comparative advantage. In the 1960s, shortly after independence, when unemployment was high, the country concentrated on attracting manufacturing firms, particularly in the garment and textile sectors. This was low-skilled work, but it lifted the incomes of the poor. In the 1970s, Singapore began to produce simple electronics, after which it began making hard-drives and semi-conductors. Since then, it has moved further up the value chain, with the country now having a comparative advantage in bio-medical research and development. Thus, over the decades, the country has steadily moved up the ladder of comparative advantage, with very positive implications for average wages as well as economic growth.

Honourable Deputy Speake

In response to the need to create jobs for young, unskilled workers, the Treasury has proposed the introduction of a wage subsidy for young workers at the bottom of the pay scale. Such a subsidy would narrow the gap between the costs employers incur when employing these workers and those workers’ likely levels of productivity. The Treasury argues that this would induce firms to employ more young people.

YOUTH WAGE SUBSIDY - ANC ARGUMENT

South African unemployment is highly concentrated among the youth, which is indicative of a general reluctance among firms to employ youth labour market participants. Within the context of structural shifts and skill-biased technical change, the high rate of youth unemployment is closely associated with educational attainment (both the quantity of education and the quality or appropriateness of qualifications are concerns), skills, and work experience among the youth. A supply-side factor is the effectiveness of job search strategies among the youth.

Many youth may have insufficient educational attainment, due either to early exit from the schooling system or to poor quality and coverage of instruction in basic literacy and numeracy. Those who leave school early are hugely disadvantaged, but even those who are better qualified face poor prospects relative to more experienced adults. Several analyses have shown that young people are entering the labour market at an earlier age but with higher education levels than in the past (Branson 2006; Pauw, Oosthuizen, and van der Westhuizen 2008).

In an economy where labour demand is constrained and has shifted toward higher-skilled labour, competition for entry-level jobs is fierce; thus, a matric (the qualification obtained in the final high school year) may simply no longer be enough to guarantee employment.  All of this raises the question of whether the youth have appropriate skills or sufficient experience relative to the needs of employers. The skills-mismatch hypothesis encompasses issues around the quality and appropriateness of education, as well as the trade-off between general versus job-specific experience or skills (Burns 2008).

Quality of education is a major concern in South Africa. Four out of five school leavers are considered functionally illiterate (i.e., they lack the language skills required to be successful at tertiary institutions) and 60 % have inadequate mathematics and science skills as they exit high school (Mlatsheni 2005). Kraak argued that this “perceived poor quality of South African schooling (particularly in the former African school system) serves as a major disincentive on the demand-side for employing large numbers of first-time entrants to the labour market” (2005, 31).

Closely related to the quality issue is the appropriateness of courses offered or, indeed, selected by students. Constant evaluation of school curricula and proper career advice to students are crucial.  Education is, of course, not the only means through which skills are obtained. Early labour market experience in the form of part-time employment eases the transition from school to work, assists youth with choosing career paths, and instils work ethics considered desirable by employers (Burns 2008).

Employers faced with high labour costs and labour market rigidities may become more selective in their hiring decisions by placing greater weight on prior experience. It is for this reason that young jobseekers are disadvantaged: Three-quarters of the unemployed youth surveyed in the LFS 2007 (Stats SA 2008) reported that they had never worked before, compared with less than half of unemployed adults. Once again, there is a racial dimension to this factor. Lam, Leibbrandt, and Mlatsheni (2007) documented large differences in the school-to-work histories across race groups in South Africa’s Western Cape Province. By age 20, only 20 to 30 % of Africans had ever done any paid work, compared with close to 90 % of whites.

Anderson, Case, and Lam (2001) found similar low work rates among African youth in the rest of South Africa. The implication is that to the extent that employers might be willing to hire youth, white youth will be at a significant advantage due to a higher incidence of prior job experience.

Limited work experience may also reflect ineffective job search strategies of the youth. Burns (2008) argued that material job search costs in South Africa are high, due to the large geographical distances between areas where employment opportunities mostly exist and areas where people reside. In particular, the youth are vulnerable given their lack of mobility and limited resources. Many youth rely on word-of-mouth from friends and family to learn about job opportunities. Successful job search through such social networks requires good-quality networks, which places those youth living in isolated areas or in communities with limited attachment to the formal employment sector at a relative disadvantage.

The health status of jobseekers and their family members is a further important consideration. For instance, the high prevalence of HIV/Aids among the youth may contribute to unemployment, since poor health impedes active job search. Some people may also be unable to take up employment because they need to care for sick or elderly family members (Burns 2008).

Once again we should ask ourselves whether a youth-targeted wage subsidy is the appropriate policy tool to address youth unemployment. In well-functioning labour markets, educational qualifications signal youth labour market participants’ productive capacity, especially where participants have limited work experience. When these signals are weak, the price of labour would normally adjust, such that firms would still provide individuals with an opportunity to reveal their productive capacity.

The problem in South Africa is that these processes do not seem to be working for young people. The market failure, therefore, lies in the fact that individuals are unable to properly signal their productive capacity to firms and are unlikely to be given opportunities to do so by risk-averse employers. Employers thus look for signals elsewhere, placing particular emphasis on past work experience and networks, leaving many youth at a disadvantage.

A highly regulated labour market contributes to employment costs and the risks associated with hiring youth labour market participants.  Wage subsidies may be effective in allowing young people to access the labour market for the first time, because the subsidies compensate firms for the risk associated with being unable to identify the productive capacity of prospective employees. However, a wage subsidy alone may not be adequate. For example, firms may continue to be unwilling to employ new labour market entrants, even with the subsidy, if the costs associated with retrenchment are high. A relaxation of the labour legislation enabling firms to readily lay off workers may thus be required to enhance the subsidy’s effectiveness, and the question one must ask is, is this what we want?

Because a wage subsidy, still does not address the most important source of youth unemployment, namely, that of inadequate or inappropriate educational qualifications? There is a need to evaluate academic qualifications in South Africa and to align them to the needs of the market. Proper career advice will enable young people to choose relevant courses, if young people do not meet the entry requirements for courses with good career prospects, educational institutions should provide bridging courses. The signalling problem can also be addressed through standardisation of examinations. Externally administered tests, such as the Standard Aptitude Test (SAT) or the Graduate Record Examination (GRE) in the United States could be adopted in South Africa.

Effective job search, in turn, is best facilitated through the provision of job search assistance or job placement services. This assistance could be combined with a job search subsidy (not to be confused with a worker-side wage subsidy) that would reduce the material job search costs. Such job search subsidies have been shown to be very effective elsewhere (see Smith 2006), though there must be proper coordination between employers and the agencies that provide such assistance.

Clearly, this area requires further investigation in South Africa, where much of the focus in the area of active labour market policy intervention has been around wage subsidies and structured workplace training initiatives, such as Learnerships.

Considering all of the above, the ANC we are of the firm view that urgent and extra-ordinary measures are required to address youth unemployment. There are far too many young people who are out of work, and these numbers are growing daily. Urgent action is needed to get more young people into the work place.

Further dialogues on the need for a discussion about youth employment that embraces the private sector, public sector, youth organisations and trade unions, would be welcomed.  These discussions should aim to rapidly achieve consensus in the form of a compact or accord on youth employment.

The youth subsidy will advance as its singular purpose private companies to maximise their profits, that radical intervention by the state in the country’s economy was the only way to change the situation of unemployed young people. If the youth wage subsidy was implemented, the government would be subsidising companies to pay the wages of young people they employ.

Private companies would claim the subsidy instead of paying for labour out of their own coffers. “What the youth wage subsidy will do is to give private companies billions to spend to pay young employees instead of paying out of their own pockets.

The attempt to return South Africa to reliance on cheap labour is wrong-headed and ignores the vital lessons of the past. Strong employment growth will require wide-ranging investment and a healthy, educated and productive labour force. The youth wage subsidy does nothing to address these fundamental and urgent tasks.

Youth Wage Subsidy Proposal

Youth Wage Subsidy

he Anc has anounced its intention to have Youth Wage Subsidy Incentives rolled out before the beginning of 2014. This subsidy is aimed at addressing issues around youth unemployment in South Africa. It is understood that the youth wage subsidy will target young people who have no income or whatsoever.

Many have critisized the Anc on its proposal. The DA has been vocal about its fears if the cabinet approves this kind of subsidy. Many have condemned DA's attempt to sway the Anc from addressing youth unemployment.

Despite all criticism the Anc remains convinced that this kinda of subsidy will indeed help the youth that has no income. The details of who will qualify for this wage subsidy have not yet been made public. It is understood that this initiative will also include what is called youth wage incentives.

Youth Wage Incentives

This incentive is aimed at employers who create jobs for the unemployed youth. It will be a rebate that will see employer receiving some tax relief if they hire young people who qualify.

President Jacob Zuma On Youth League Celebration

Address by President Jacob Zuma on the occasion of the 69th anniversary celebrations of the ANC Youth League

15 September 2013, Seshego, Polokwane, Limpopo

The Leadership of the ANC,
Convener of the ANCYL National Task Team, Cde Mzwandile Masina and all NTT members,
Leadership YCL, SASCO and COSAS,
Comrades and friends,
Fellow South Africans,

I bring you revolutionary greetings on behalf of the National Executive Committee of the African National Congress as we meet to celebrate 69 years of the political home of all progressive young people in our country!

The 69th year anniversary of the ANC Youth League is a cause of much excitement, given the contribution of the ANC Youth League to the struggle for liberation and the consolidation of democracy in our country.

Formed on the 10th of September 1944 at the Bantu Men`s Social Centre in Johannesburg, the Youth League was only in its fourth year of existence when the National Party came into power and institutionalized racism and subjugation of the black majority.

It has been a long walk to freedom since then, and we salute all the giants of our revolution produced by the ANC Youth League and who developed and strengthened the Youth League, including Anton Lembede, Robert Resha, Mxolisi Majombozi, Oliver Tambo, Walter Sisulu, Nelson Mandela, Lawrence Phokanoka and many others.

The Youth League has gone through many milestones in 69 years.

MILESTONES OF THE YOUTH LEAGUE

ANC Programme of Action and the Defiance Campaign, with Nelson Mandela as Volunteer in Chief.

1940s they introduced a Programme of Action and new militancy 1950s Defiance Campaign and new activism of boycotts 1960s they were at the cutting edge of the struggle especially as first MK cadres carrying out sabotage and combat missions 1970s the youth uprisings and new youth militancy 1980s mass democratic movement and rendering apartheid ungovernable 1990s they exerted new politics of mass mobilisation and vigorous campaigns June 1976 which led to an exodus of young people to join MK in exile and produced soldiers such as Solomon Mahlangu and many others.

1980s-The formation of militant youth formations such as SAYCO which worked within the UDF fold, responding to President OR Tambos call to make townships ungovernable and apartheid unworkable.

1990s-Participation in rebuilding the ANC inside the country and working for a decisive ANC victory in the first democratic elections and subsequent elections.

Defending and consolidating the gains of freedom and democracy.

ORGANISATION BUILDING -DISCIPLINE

Comrades

The anniversary reminds us of the need to build the type of ANC Youth League that young people and the country as a whole can look up to with admiration, inspiration and respect.

The ANC is the leader of society, and the ANC Youth League is the leader of all youth in our country regardless of class, race or gender, as the biggest youth formation in the Republic.

We congratulate the National Task Team on the work done thus far in rebuilding the structures of the ANC Youth League.

Also important is the return of dignity and discipline within the League which will rebuild the trust and respect that our people have always had for the ANC Youth League.

The founding fathers of the Youth League correctly understood the role of the League as an incubator and preparatory school of the movement when they wrote in its manifesto that:

"African youth must be united, consolidated, trained and disciplined because from their ranks, future leaders will be recruited".

We are glad that the League has thus far primarily not failed on this mission.

ROLE OF THE LEAGUE IN THE ERA OF FREEDOM AND DEMOCRACY

Comrades

The Youth League derives its existence and its programmes and vision from the ANC`s vision to create a united, non-racial, non-sexist, democratic and prosperous South Africa.

This is the vision which constitutes the core objectives of the National Democratic Revolution and which is the basis for our Alliance with all democratic and progressive forces in our country.

In bringing this vision to life, we are working to create a society where all have food on the table, where children go to good quality schools and receive good quality health care in good hospitals.

We are working to create viable human settlements with water, electricity, good roads, libraries, community halls and recreational facilities.

We are working with business, labour and the community sector including the youth in particular to promote economic development and economic growth so that our people can gain jobs and also find income generating activities.

The question of economic freedom is paramount on the agenda of the ANC as pronounced recently by both the Polokwane and Mangaung national conferences. It is also on the agenda of the ANC Youth League.

We have a long way to go towards equitable ownership, control and management of the South African economy.

The Johannesburg Stock Exchange 2012 Report indicated that while 21% of shares of ownership of the top 100 companies are held by black people, direct black ownership is less than 5%.

The annual Employment Equity report each year indicates very minimal movement with regards to the control and management of the economy.

All reports point to the fact that white males are still in control of the means of the production.

The ANC has long moved beyond slogans and has begun to practically prepare our youth for leadership of the economy through education, internships, learnerships and black economic empowerment and affirmative action programmes.

We are happy that the enrolments at higher education institutions have increased by 50 percent since 2001 which indicates a growing hunger for education.

Numbers moved from six hundred and three thousand (603 000) students enrolled in 2001 to nine hundred and thirty five thousand (935 000) in 2012.

It is for this reason that the ANC government is building two brand new universities in Mpumalanga and the Northern Cape, which will begin accepting students next year.

We are also building 10 new Further Education and Training Colleges and refurbishing two colleges, to further open the doors of learning.

You are aware that children from poor households do not pay fees at FET colleges to further expand access to education.

The more we produce skilled young graduates, the more we need opportunities for internships and jobs.

The National Youth Accord that was negotiated and signed between business, government, labour and the community sectors especially the youth in April this year, is designed to help alleviate the question of youth training and employment.

We appeal again to the private sector to absorb as many young people as possible for internships, learnerships and mentorships.

Government is also processing the Employment Tax Incentive Bill through which, when it becomes law, employers will benefit from tax incentives when hiring young workers, but without displacing older workers. The Bill is still being discussed within the Cabinet system.

We urge the ANC Youth League to work on this project closely with the ANC government, the National Youth Development Agency and employer organisations to assist the youth to obtain much needed employment and training opportunities We remind the youth as well of ANC laws such as affirmative action and Black Economic Empowerment which have already demonstrated success and benefits for many black businesspeople and professionals.

We need to use these further as transformation tools.

Affirmative Action and Black Economic Empowerment are consititutional imperatives designed in terms of Section 9 of the Constitution to correct the inequality and exclusion faced mainly by Black people, namely Africans, Coloureds and Indians, as well as women and people with disabilities, which was caused by apartheid laws.

The ANC government has put before parliament a Broad-Based Black Economic Empowerment Amendment Bill to further enhance transformation.

Amongst the proposals put forward is the introduction of a Commission that will oversee, supervise and promote adherence to the B-BBEE Act and codes in the interest of the public.

The Bill also introduces drastic measures such as criminalising misrepresentations of the B-BBEE status of an enterprise and providing false information or misrepresenting information to the Verification Personnel in order to secure a particular B-BBEE status.

It would also criminalise the failure by government officials to report BEE violations to an appropriate law enforcement agency. The minimum penalty that can be imposed on an enterprise for a deliberate misrepresentation of its B-BBEE status is 10% of its turnover, and further for a minimum term of 10 years imprisonment for owners.

The ANC government also has in place, progressive laws such as the Employment Equity Act and other progressive transformative laws. Let us use these instruments to change our country for the better.

With regards to the standard of living in general, Census 2011 revealed shocking statistics that the income of the average white household still remains six times higher than that of the average African household.

Figures indicate that the average annual African household income is R60 613 while that of the white household is R365 164.

 

Inequality therefore continues to stare us in the face, requiring more work from government and all sectors to bridge the gap between black and white further.

We also need to further improve our success rate on land reform.

In the State of the Nation Address I announced the intention of government to reopen restitution claims for those who lost their land since June 1913 but missed the deadline of 31 December 1998. The process is ongoing.

SOCIAL TRANSFORMATION

Beyond economic transformation, the ANC Youth League also has a responsibility to contribute to building a caring society and to support youth in distress.

Gangsterism, drugs and substance abuse cannot be allowed to continue destroying our communities. We therefore remind you of your role in the campaign against drugs and substance abuse in all communities.

On health, we acknowledge the contribution of the ANC Youth League to the campaign against HIV and AIDS in which we have scored some major achievements as a country. The struggle continues to promote HIV prevention campaigns and to encourage those living with the virus to continue taking treatment.

On international relations, let me remind you that you are descendants of freedom fighters who promoted peace in this country and the world such as Oliver Reginald Tambo, Johnny Makatini and many more.

The ANC Youth League should continue the quest for a better Africa and a just world.

The ANC government continues to participate in peace missions in the continent and our soldiers are doing a sterling job within the continent.

We also continue to promote the United Nations and multilateralism. It is our view that a stronger and more representative United Nations Security Council will be able to promote equitable global governance in which bigger and more powerful countries do not bully other nations into submission on peace and security and other matters.

It is for this reason that we are campaigning for the representation of Africa in the United Nations Security Council. A continent with one billion people must be a permanent member of the UN Security Council.

Comrades and friends

Today we are celebrating 69 years of militancy, bravery, fearlessness, robustness and radicalism.
We are celebrating 69 years of constant injection of new and fresh ideas into the ANC on how we must accelerate our advance towards creating a better South Africa.

We celebrate the fact that the history of the ANC Youth League is the history of the evolution of the South African society.

We therefore encourage all members of the Youth League to work hard to rebuild the League, and strive continuously for the unity and cohesion of the organisation.

The Youth League must rise above the challenges it is confronted with currently and emerge out of them more united, stronger, radical and militant within the overall organisational discipline of the ANC.

But the ANC Youth League must not only be inward looking. It must also respond to the broad challenges facing young people in our country.

As you mobilise young people behind the vision of the ANC, you must also be able to capture their imagination and champion their aspirations.

That is the only way in which this Youth League of Nelson Mandela can remain relevant and `cool`.

This must be an ANC Youth League that moves with the times, and remains in touch with the lives of young people and where they are right now in terms of development.

Our message to South African youth on this important day is that the ANC is the only organisation that is capable of resolving the challenges of unemployment, poverty, disease, inequality and need for skills that faces our young people.

Your ANC Government has concrete programmes to address these challenges which it is implimenting as we speak as opposed to shouting from rooftops just because it is time for elections.

Under the leadership of the ANC, South Africa will continue to make progress in the quest for a better life for all.

Research has shown that there are about 4 million young people who have not registered to vote.

The immediate task of the Youth League and the Progressive Youth Alliance is to reach out to these young people and ensure that they are registered to vote.

Their votes count immensely and must not be wasted. They must vote ANC so that we can take forward the progress made in the past five years and also in the past two decades of freedom and democracy.

To all members of the ANC Youth League, keep calm, you are in control. The ANC lives, the ANC leads.

Lets go out there and build the ANC and give the movement a resounding victory in next years elections!

Happy 69th anniversary to the ANC Youth League!

Thank you very much.

Amandla!
Matla!

All power!