ANC raises prospect of youth subsidy in 2013

[] – HOPES of a youth wage subsidy for unemployed young people have not been disappointed as the ANC admitted there needs to be some form of incentive to get more young people in the job market.

Malusi Gigaba, public enterprises minister and a member of the ANC’s commission on economic transformation, said the ruling party does not want to debate about a name for a solution to youth unemployment, but acknowledged there had been a number of proposals – one being a social compact between business and government.

“The ANC may still agree on some sort of incentive to absorb youth unemployment,’ Gigaba said during a media briefing at the ANC’s 53rd national elective conference in Mangaung.

“We don’t rule out that there should be a form of a youth incentive and discussions should be expedited,’ Gigaba said. The proposal will be further discussed in January next year.

The policy of a youth wage subsidy – whereby employers will receive a subsidy in the form of tax breaks to employ young, inexperienced workers – was announced by President Jacob Zuma at his state of the nation address in February 2010.

Cosatu has opposed the idea, arguing that it would disadvantage older workers as employers would give preference to younger people in order to get tax breaks.

Earlier this week planning minister Trevor Manuel told delegates at a business breakfast in Mangaung that there will be a number of big announcements on the subsidy early in the new year. If the ANC does decide to implement the subsidy, it will be seen as disregarding Cosatu’s opposition to the plan.

Asked the ANC is not alienating Cosatu with the policies it’s adopting, Gigaba said the elective conference is an ANC conference. “We are adopting our policies and there will be areas where policy decisions are not the same,’ he said.