BLSA’s CEO’s Weekly Newsletter: While new visa regulations are welcome, there are concerns about government effectiveness

---

There has been another positive stride forward for policy reform in the implementation of new visa regulations that will fundamentally alter the way work visas are provided in South Africa. The digital nomad visa allows foreigners to come and work remotely from South Africa if they earn more than R1m, and the legal framework has now been put in place for a point-based system to replace the critical skills list. The criteria for the points system are due to be published by the end of April. Other changes include easing the requirements for police clearance certificates and other documents.

I have previously written about how the cumbersome visa system makes it extremely difficult for business to bring in international skills. For foreign investors it is a major impediment to being able to commit their funds to the country. They cannot be expected to build new factories or data centres without confidence that they can send in their best global people to set up or manage them. In May last year, Operation Vulindlela, the joint venture between the Presidency and National Treasury to unlock structural reform, published a detailed report on what should be done to improve the visa regime with many good recommendations. BLSA helped fund that work. The report showed how skilled foreigners enable domestic employment, increase taxes and support economic growth. The announcement on the eve of the Easter weekend implements some of these.

Although the announcement lagged the Department of Home Affairs’ own timetable for the reforms (some of which it said would be done in 30 days) that it set out when the Operation Vulindlela report was published, it is positive that the regulations are now in place.

However, the regulations themselves do not mean they will be effective in actually making it easier for skilled foreigners to work in South Africa. As we well know, regulations can enable an effective government, but it takes resources and leadership to deliver the services that should theoretically be available. This is especially so in the case of visas. Because of my position, I regularly receive emails and messages from business leaders, desperately trying to get the Department of Home Affairs to process applications. One US multinational recently had visas denied for two senior engineers without explanation, leaving it unable to manage critical systems for its business. Various European chambers of business with many investors here have been trying for many months to engage home affairs on the countless outstanding visas for  company executives and their families who should have long been in the country. I’ve written of other examples of such delays or the simple lack of response from the department before. According to Home Affairs’ own figures, a backlog of many thousands of applications has arisen and continues to grow. Judging from the many messages I receive this problem is still far from being resolved.

So, while the regulatory reforms are welcome and have the potential to make a big difference to how easily businesses can access foreign skills, my concern is whether Home Affairs has the capacity to do its job successfully. Government needs a plan for how it will resolve the massive backlog in existing applications, and then develop a change management programme for how the bureaucracy will become fit-for-purpose in functioning under the new regulations. We need to ensure that the gap between policy and effectiveness is closed.

Of course, this is not the only example where effectiveness is a problem within a potentially conducive regulatory environment. To cite just one more from the news last week, British American Tobacco is scaling down its retail distribution, affecting 500 jobs, because of the way its business has been affected by the illicit cigarette trade. Illicit cigarettes are of course illegal and cost the country a fortune in lost excise duty, yet the police and revenue service have not been able to stem the tide. There are many other examples where it is not the policy that is the problem, but the effectiveness of government functioning within the policy. Policy can be key in clearing the way for government to be effective, but it is not enough.

BLSA dedicates extensive resources toward supporting government to become effective including funding mentors through the Tamdev programme to work in the public sector to build skills in key areas like civil engineering. But our approach is to overcome temporary blockages, ensuring that government can become effective in its own right. Government effectiveness is a goal that we all share, but it is ultimately the responsibility of government to deliver the services it is mandated to provide. When it comes to visas, it is time for a plan that prioritises effectiveness to ensure that good policies make a real difference for the economy.

+++

BLSA is a business organisation that believes in South Africa’s future and shares the values set out in the Constitution. BLSA is committed to playing its part in creating a South Africa of increasing prosperity for all by harnessing the resources and capabilities of business in partnership with government and civil society to deliver economic growth, transformation and inclusion.

---

Have your say.
Share your opinion