Old Mutual throws down economic transformation gauntlet
It is time for the financial services industry to focus on its role in accelerating economic transformation in South Africa, particularly in poor provinces such as the Eastern Cape, said Paul Hanratty, the managing director of leading investment and savings group, Old Mutual (SA).
Speaking last night (29 October 2007) at a stakeholder function in Mthatha, in the Eastern Cape, Hanratty observed that while several initiatives are underway, the industry must continuously seek innovative ways to tackle skills development, infrastructure development and access to financial services.
Hanratty reconfirmed Old Mutual (SA)'s commitment to playing a leading role in the economic transformation of South Africa.
"In designing our transformation activities, we have sought to address the challenges that we face as a country, and to support the government's Accelerated Shared Growth Initiative of South Africa (AsgiSA) to ensure a better life for all," he said.
Over the past year, Old Mutual has deepened its commitment to South Africa's economic transformation by launching a range of bold and visionary initiatives designed to boost sustainable economic growth and the wellbeing of all sectors of South African society.
On 31 May 2007, Old Mutual announced that R400million from its Unclaimed Shares Trust (funds set aside for clients of Old Mutual when it demutualised in 1999) would be used to finance a range of economic transformation projects. Called Masisizane, which means, "let us help one another", this initiative will consolidate and drive specific projects aimed at accelerating shared economic growth in South Africa.
These projects include:
* Financial access for women in rural and peri-urban areas;
* Literacy and education programmes; and
* Skills capacity building; through an initiative called Ilima in which the Old Mutual group has deployed some of its top retiring executives to assist provincial and local government with capacity building. The Illima Trust board consists of members of Old Mutual's black business partners, Wiphold and Brimstone as well as officials of the Department of Provincial and Local Government.
The Masisizane Fund has already started to deliver, Hanratty said. In August this year, Deputy President Phumzile Mlambo-Ngcuka welcomed a R20million contribution from Old Mutual's Masisizane Fund on behalf of Jobs For Growth - a national programme in support of the AsgiSA interventions in the second economy. The Jobs For Growth programme provides support for communities to produce goods and it facilitates market access for these communities.
This donation was followed by a partnership between the Masisizane Fund and the Small Enterprise Foundation (SEF), an NGO and micro financier, to create a R20 million micro-finance fund aimed at supporting the development of women enterprises in rural areas. The contribution has enabled SEF, which was initially based in Limpopo, to expand to the Mnquma district in the Eastern Cape and the organization has opened offices in the town of Centane.
Late last year, the Development Bank of Southern Africa (DBSA) and Old Mutual announced the launch of the Hluma Development Local Investment Agency (Hluma) - a multi-million Rand Local Investment Agency. Old Mutual and the DBSA have each committed R250 million over the next five years to the Hluma initiative. Hluma will facilitate the involvement of private and public sector investors in the Wild Coast (Eastern Cape). These investment projects will stimulate economic activity and sustainable job creation in this impoverished region.
Along with the other South African subsidiaries of Old Mutual plc, Nedbank and Mutual & Federal, Old Mutual is also working closely with provincial and local governments to address infrastructure, skills and financing needs of various Project Consolidate Municipalities.
Hanratty said that skills development was an area in which financial services companies could play a significant role. For example, Old Mutual, through the Old Mutual Business School, is involved in a programme to fast track project management skills in the public sector. This is in support of the government's Joint Initiative on Priority Skills Acquisition (JIPSA). The focus for this year is on Skills Capacity Building for the National Youth Service and capacity building of female mayors, he said.
However, despite the Old Mutual's achievements in economic transformation so far, there was still a long way to go, he said. "The group is working hard to provide improved support in crucial areas such as access to financial services and encouraging the nation to save".
Hanratty urged all South Africans to flex their collective moral and financial muscle to help South Africa achieve its potential.
"This generation must make sacrifices for the future of the next generation," he said.
