2019 Budget well received

Wednesday, February 20, 2019

Ministers have widely welcomed Finance Minister Tito Mboweni’s 2019 Budget, saying he had done well in the largely unstable economic climate.

Cooperative Governance and Traditional Affairs (Cogta) Minister Zweli Mkhize said Mboweni had a difficult budget amid rising debt and stunted economic growth.

“The Minister has tried everything that can be done. It’s a very difficult budget, it’s a very difficult economic situation – it’s a difficult environment with rising debt levels. What he did was all that could be done,” he said.

Stabilising expenditure

Mkhize commended his finance counterpart for giving attention to programmes that will help to stabilise government’s expenditure, paying attention to programmes that will spare service delivery for poor communities, welfare and the infrastructure issues and investing in the economy.

“He’s been very clear in supporting some of the initiatives that the President has started: the fight against corruption and the resourcing those units. Under those circumstances, that is all that could have been done. There’s not much room to increase tax or even touch the VAT. The strengthening of the SARS unit means we are going to reduce the wastage and weaknesses in the collection of revenue,” he said.

Public sector wage bill

In the Budget speech, Mboweni said the current public wage bill is unsustainable for the fiscus with a need to shift expenditure to investment.

The Budget stated that national and provincial compensation budgets will be reduced by R27 billion over the next three years. Mboweni said the first step would be to allow older public servants, who want to do so, to retire early and gracefully.

Responding to this, Public Service and Administration Minister Ayanda Dlodlo said the compensation of employees expenditure budget is the second highest of all budget items.

“We have a responsibility to assist in ensuring that its reduced down so that part of the money can go towards other national priorities like education and the health sector,” she told SAnews.

She added that the Department of Public Service and Administration (DPSA) is in the process of unveiling work which it has done in assisting to bring down the wage bill.

“But on the converse of that there are also infrastructure projects that are being mooted from the side of the economics cluster which need to be supported by a training and development programme which we as the department and the National School of Government are assisting in putting together.”

For example it was revealed that work at Eskom’s Kusile and Medupi power stations, suffered contract management challenges.

“The contract management part of things was not effectively undertaken. What we are looking at is a more comprehensive contract management and project management programme that will also help the public sector including local government,” she said.

The embattled parastatal is facing a R420 billion debt burden and the Department of Public Enterprises (DPE) says the State-owned entity (SOE) will cease to exist at the current trajectory by April this year.

Eskom’s Build Programme has added to the cost overruns and poor performance at the power utility. The two power stations have suffered massive delays and cost overruns due to poor planning, poor engineering designs, poor procurement practices and corruption.

Tackling the Fourth Industrial Revolution

Meanwhile, Science and Technology Minister Mmamoloko Kubayi-Ngubane said the budget was a well-balanced one that took cognisance of the challenges the country currently faces.

”I think it was a well-balanced budget delivered under difficult conditions, it gave hope that we will be able to come out on the other side. The budget did not make promises that it cannot be able to achieve. It spoke very well to the issues raised by the State of the Nation Address (SONA),” she said.

Kubayi-Ngubane was pleased with the budget’s acknowledgement of the importance of technology and South Africa’s response to the Fourth Industrial Revolution.

“Placing the importance and the finances of the budget in the hands of our future and reinvesting money where it matters most - about jobs for the future which will be in science and technology, that is important for us,” she said.

Interventions in education

Basic Education Minister Angie Motshekga expressed delight at education interventions contained in the 2019 Budget. Among these is the allocation of R30 billion to build new schools and maintaining schooling infrastructure.

“We are very encouraged because there are just too many things to do and we have not been able to do [them]. [Things] like really fast tracking our infrastructure … and resources. We are encouraged because it’s been on the rise for the past three financials and at least we can now see more progress,” she said.

She said she would soon meet the Development Bank of Southern Africa which would lead some of the projects.

Support for the arts

Arts and Culture Minister Nathi Nhleko also expressed delight at allocations to entities in the arts and creative sector.

In the speech, Mboweni said officials from National Treasury and the Department of Arts and Culture will consider proposals for the development of a new national theatre, a new national museum, and also consider financial support for the National Archives, a national orchestra and ballet troupe.

“We have gained a lot. The very fact that we are going to build a new state theatre, or revamping it, is good for creatives. He also raised the issue of national archives. National archives are the records of any nation. We need to know what happened in the past.

“The new generation and those who are still coming should know what happened around this time. It’s good for us. It means we are eyeing the fourth industrial revolution,” he said. – SAnews.gov.za