Johannesburg - Finance Minister Pravin Gordhan must state how the national Treasury plans to reduce government debt, the SA Chamber of Commerce and Industry (Sacci) said on Tuesday.
“National Treasury must also present a credible plan on how government debt will be reduced over time in order to improve our credit rating and facilitate easier access to finance for the private sector,” chief executive Neren Rau said.
Gordhan is scheduled to deliver his medium-term budget policy statement (MTBPS) in Parliament on Wednesday.
Rau said the country's economic growth was highly dependent on attracting and sustaining the interest of foreign investors and this was the most important immediate policy priority.
Government needed to borrow funds as cheaply as possible in the short-term to expand the infrastructure network and accommodate the growing public sector, he said.
Rau said Sacci expected Gordhan to also discuss carbon tax. Sacci was against the proposed carbon tax which could lead to massive job losses.
He said other concerns over the impact on investor confidence and the sustainability of various sectors implied that Gordhan would present a more “feasible plan” and delay the 2015
implementation to allow time for stakeholders to deliberate.
Sacci expected Gordhan to speak about the public sector wage bill because one in four South Africans worked for government, he said.
“Merely paying public servants has now become a major influence on fiscal policy, as opposed to building schools, expanding infrastructure and providing basic services,” said Rau.
“This trend is unsustainable and the South African business community calls on minister Gordhan to commit to drastically reverse rather than merely delay the growth of the wage bill.”
Sacci also expected Gordhan to address the small and medium enterprises (SME) tax administration and the employment tax incentive, Rau said. - Sapa