The gear legacy: did gear fail or move South Africa forward in development?

Abstract

This article describes the economic and development policy legacy of the Growth, Employment and Redistribution (Gear) programme. It considers the arguments for and against Gear, and attempts to answer the question whether or not the programme has moved us forward in development. The economic legacy is described as dismal development outcomes but excellent macroeconomic policy outcomes. The policy legacy is described as continuing with Gear in some respects, but also incorporating a shift in development strategy that takes into account critique of Gear from the left and proposes a more active and direct role for the state in employment creation. This shift is seen as positive because the key challenge in the post‐Gear period is how to use the state more effectively to create jobs and provide income for the poor. The overview of the arguments for and against Gear finds most of the former to be thin. Moreover, it highlights conceptual flaws in the strategy that explain why it failed to produce the promised employment creation and poverty reduction by the end of the programming period (1996–2000). However, there is no clear answer to the question of whether or not Gear has failed – would an alternative policy have produced better outcomes in the period? Also, Gear has improved the private investment climate and produced better resource and institutional conditions for government to play a more active role in pushing future development. Whichever way it is argued, a key point that emerges is that development prospects will remain gloomy if the government reverts back to the strategy of relying largely on the private sector to reduce poverty, and fails to do more itself via effective income support programmes for the poor.

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