Business has a clear incentive to find a solution, writes BLSA CEO. 

A lack of critical skills is holding back the South African economy, and we are not solving the problem as fast as we should be. There is a backlog of 74 000 applications for all kinds of visas at the Department of Home Affairs according to an official quoted by Bloomberg last month, many of those in the scarce skills category.

This despite concerted efforts by government, led by the Operation Vulindlela programme, to drive implementation of policy that will substantially improve access to scarce skills visas.

The backlog is staggering, a number in line with the headcount of some of South Africa’s biggest companies. If those skills were to suddenly be working in our economy, the impact would be significant.

The fact that companies can’t fill the positions means they can’t invest and expand. Expansion would enable much further employment, more tax to be generated, and the overall business environment to be greatly improved. The presidency has estimated that one additional job is created for every skilled post that is filled.

I have been told anecdotally by companies that service has improved from the Home Affairs Department, but the backlog remains a problem to get on top of.

I have highlighted what poor visa policy does to business in the past and the good work that has been done under OV to overhaul the policy. The presidency has said access to visas is the second biggest constraint on the economy after loadshedding. The new policies include the introduction of a trusted employer scheme that will allow certain companies to fast-track applications. Home Affairs said in April that it would have the scheme in place in three months.

There has certainly been progress, with application forms published in October. However, to date no company is yet benefiting from the scheme and there does not appear to be a clear timeline for when they will. Home Affairs has also missed deadlines for other visa reforms including remote working visas to enable so-called “digital nomads” to work from South Africa and visas for founders of start-ups that choose to launch their companies in South Africa.

I appreciate that some policy reforms can be challenging, requiring legislative amendments and changes to regulations in multiple domains. But not all are so difficult �` remote workers, for example, can be changed simply by revising the immigration regulations, a relatively straightforward process.

But even when improved policy outcomes are delivered, the backlog will still be a problem. It appears to be fundamentally administrative in that Home Affairs simply does not have the capacity to process the applications. That needs a long-term fix that must be made by the department, with appropriate resourcing to manage the load. But there is clearly a need for a short-term stopgap to get on top of long-outstanding applications.

Business could help. The private sector has extensive administrative capacity that could be drawn on to process the backlog. While the procedures to do so would need to be determined, and staff capacity will need to be built through some training, the backlog could be resolved in a matter of months.

The right technology could also be brought in to improve processing, given that Home Affair’s computers work at roughly one-sixtieth the speed of those in most banks.

In much the way that business has assisted government with technical skills to resolve infrastructure breakdowns ranging from sewerage treatment plants through to electricity stations, the visas backlog could be tackled through a partnership between business and government. It is certainly a possibility worth exploring.

Business has a clear incentive to find a solution. The inability to bring in foreign skills risks pushing many companies out of South Africa entirely. We have long marketed ourselves as a “gateway to Africa”, attracting companies to set up their regional headquarters here.

Yet many companies who have done so now encounter extreme frustration in bringing in the skills they need to operate. They would have no such problem had they opted instead to set up in Dubai or Mauritius. OV says that applications for similar visas in Kenya take three months, while in Nigeria it is two.

Analysis by OV suggests that about 900 000 South Africans emigrated in 2020. Many of those were skilled, so freeing up the ability to attract foreign skills is very important to support the economy. The backlog represents applications made through an arduous process that includes police clearance certificates from every country that applicants have previously worked in.

About half of the applications that Home Affairs does process are rejected. Countless more are never made in the first place because potential applicants are discouraged by the bureaucracy. Unsurprisingly, given the delays and difficulty in making an application, the numbers have been declining, with about 3,000 scarce skills applications in 2021 compared to 7 000 in 2017. The policy overhaul proposed by OV urgently needs to be delivered.

The visa chaos is a clear example of good policy thinking failing to be implemented. Business is willing to work with government to get to the outcomes that would leave everyone better off.

The function of business in economics is to contribute production of goods and services to society and the employment of labour for which it is reasonably taxed by the state.

The function of the state is to use those funds and the funds from personal taxes and other taxes like VAT etc to the benefit of the citizens in the form of infrastructure, security, health and education. 

The function of the ANC seems to be to deploy their inept members in state departments to steal whatever they can. 

When business has to be deflected from its main function to support the function of the state, the economy slides into being unable to compete globally and the economy fails.