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Johannesburg - The South African middle class are the biggest losers in this year's budget, the trade union Solidarity said on Wednesday.

“A sizeable increase in the fuel levy, ostensible relief from personal income tax and the implementation of the controversial tolling system on Gauteng highways make the middle class the biggest losers,” Solidarity researcher Piet le Roux said in a statement.

“The middle class will have to cut back in other areas when products and services become more expensive due to the increases.”

The union was concerned about the country becoming a welfare state.

“While Minister Gordhan held that global economic problems were related to unregulated capitalism... Solidarity is concerned that he was losing sight of the crisis of the growing welfare state that was created by the government and is financed by taxpayers,” he said.

According to Gordhan, the South African economy has grown on average three percent per annum since 2009 and economic growth is expected at 2.7 percent during 2012. Growth of 3.6 percent and 4.2 percent is forecast for 2013 and 2014 respectively.

“South Africa's economic growth will therefore have to average more than 10 percent per annum in each year from 2015 to 2020 to achieve the same result as the government's growth plan of seven percent per annum by 2020,” Le Roux said.

Solidarity maintained that the government's increased spending on education would not resolve the structural problems in the education system. - Sapa

The full Budget speech