The Poverty Implications of Governance in South Africa

Good governance is critical in the fight against poverty. It entails reshaping politics to benefit the poor. This article utilised the quantitative cross-section design and the principal components regression analysis (PCA) to investigate the relationship between good governance, particularly government effectiveness, and poverty reduction in South Africa, drawing on the Oxford Global Multidimensional Poverty Index and the World Bank Governance Indicators. The PCA extracted two components; the first component variance represents about 36 per cent of the population who are middle-high income earners. The second component variance comprises approximately 60 percent of the people that earn a low income. The group has been the target of several poverty reduction policies and is the subject of this study. The PCA regression showed that government ineffectiveness, political instability, and corruption are vital factors in the increased poverty levels amongst low-income earners in South Africa. We recommend that; institutions should offer good governance through accountable and transparent administration of poverty alleviation programmes. Research is needed to programme activities and assistance packages that are feasible and geared to country-specific conditions.