Students who came to Parliament on Wednesday to demand money for higher education from Pravin Gordhan, the Finance Minister, did not leave empty-handed.
In his tough medium-term budget in the National Assembly, Gordhan gave students R8 billion for zero fee increases next year – to those who qualify.
Gordhan and Higher Education Minister Blade Nzimande earlier told journalists in a pre-budget briefing in Parliament, that everything was done to accommodate the students.
But in his Medium-Term Budget Policy Statement in Parliament, Gordhan said the country was not out of the economic woods yet.
More was needed to stabilise the economy and attract investors, he said.
Gordhan told Parliament the government would continue to cut spending over the next few years.
He said public spending would be reduced by R26bn in the next two years, and R43bn in additional taxes would be raised in the same period.
However, Gordhan refused to identify areas of tax increases. Carbon tax is one area earlier identified by government, but no concrete plans have emerged since the proposal was mooted about five years ago.
The other area government wanted to focus on was reducing spending in local government.
He said more could be done to improve the financial performance of municipalities.
Gordhan also reminded Parliament that social spending would remain on the increase.
This is one of the biggest expenditure items in the budget.
He said the government would expand its HIV/Aids treatment programme and increase the conditional grant for the National Health Insurance.
Economic growth was also stunted, with the National Treasury revising its projections for this year.
“The MTBPS revises our growth expectation for the South African economy to 0.5% for the 2016 calendar year, somewhat lower than the February estimates of 0.9%,” he said. But he said they expected growth to rise to 1.7% next year.
Gordhan also noted that revenue would fall R23bn, putting more pressure on the fiscus.
Parties in Parliament said Gordhan walked a tightrope in the mini-budget.
ANC secretary-general, Gwede Mantashe, said everything Gordhan said in the MTBPS was in line with ANC policies. He said this was not a budget based on populism, but a budget that stuck to real economic conditions.
DA MP David Maynier said they were disappointed with the budget. He said there were no concrete plans on policy certainty and structural reforms in the economy.
IFP chief whip, Narend Singh, said: “The Minister kept himself neatly on the trajectory of fiscal consolidation and, in so doing, projected a decrease in expenditure, whilst speaking about bolstering revenue by R13bn next year.
“This, added to the R15bn he had advised of at the beginning of the year, could help offset some of the increasing fiscal demands on the budget, an example being the ‘no fees’ at our tertiary institutions,” said Singh.
Steve Swart of the ACDP said Gordhan stuck to his commitment of fiscal consolidation. He had remained resolute to table a sound budget despite political pressure and his troubles with the prosecuting authorities.