Budget ‘tough, conservative’: CopeComment on this story
Parliament, Cape Town - The 2013 Budget is “tough and conservative”, but is exposed to factors outside the control of the Treasury, Cope said on Wednesday.
It was a “no-surprise, conservative budget, but 1/8a 3/8 huge risk if labour is not supporting it”, the Congress of the People said in a statement.
It was clear Finance Minister Pravin Gordhan had built it based on ability to grow the economy.
The fact that he had taken the National Development Plan (NDP) as its point of departure was to be welcomed.
However, the NDP's annual growth rate of more than five percent was in contrast with reality.
“We see a revenue shortfall of R16.3 billion and a deficit of 5.2 percent in 2012/13, and (a) debt ratio stabilising above 40 percent, costing us R100bn in debt servicing costs next year.
“The fact that the deficit will go down to 3.1 percent in 2015/16 is built on 'economic growth projections', making fiscal policy vulnerable.”
The country's ability to open new markets this year would be vital.
On tax spending and debt, Cope said the announcement that the SA Revenue Service had collected R16.3bn less than expected in revenue “is not good news”.
So too, the 23 cents a litre increase in the fuel levy.
“The success (of the budget) will lie in the implementation of the NDP, changing domestic sentiment for investment by business, and getting labour to support the same goals.
“The fact that this budget is done within the framework of the NDP must send a strong message to investors and be a boost for business consideration,” it said. - Sapa