Minister of Finance Tito Mboweni receiving special attention from Defence Minister Nosiviwe Mapisa-Nqakula and DG in the Presidency Dr Cassius Lubisi during the Cabinet meeting held this morning. Minister Mboweni is expected to deliver the much anticipated 2020 Budget Speech and related Bills in the National Assembly, Parliament, Cape Town. Photo: Elmond Jiyane/GCIS
Minister of Finance Tito Mboweni receiving special attention from Defence Minister Nosiviwe Mapisa-Nqakula and DG in the Presidency Dr Cassius Lubisi during the Cabinet meeting held this morning. Minister Mboweni is expected to deliver the much anticipated 2020 Budget Speech and related Bills in the National Assembly, Parliament, Cape Town. Photo: Elmond Jiyane/GCIS

Mboweni’s smartly polished shoes showed he meant business

By Siyabonga Mkhwanazi Time of article published Feb 27, 2020

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CAPE TOWN – For Finance Minister Tito Mboweni, the day of the Budget started with a different struggle: a fiddle with a tie that eventually required the help of the director-general in the Presidency, Cassius Lubisi.

But it was a struggle that would characterise the rest of his juggling act that involved fiscal consolidation, while avoiding hitting worn-out taxpayers hard in the pocket.

It had to be a careful act of calming the markets, while injecting more cash into the economy.

He was acutely aware, as he later admitted in his speech, that there was pressure on the government to do more with less, as the days of surpluses were long gone.

In a country where the Budget deficit has widened to 6.8 percent, and the national debt threatening to breach 70 percent in the next two years, the tightrope had to be managed carefully.

And the sin taxes were there for the taking: with smokers taking the biggest knock, as a packet of 20 cigarettes has to carry an extra 74 cents in levies; heated tobacco products are to contribute 75 percent of the excise duty on tobacco products to the fiscus, and a 750ml bottle of spirits such as whisky, gin or vodka attracting a further R2.89 in taxes.

“In line with the Department of Health’s policy, we will start taxing heated tobacco products, for example hubbly-bubblies,” Mboweni pointed out.

Mboweni knew that the increase in debt-service costs would result in less expenditure for other items in the Budget.

These are tough times, and it will be difficult to reverse all the serious challenges in the economy.

This was Mboweni’s second Budget since he took over the reins. One politician said this week the country should not expect miracles from Mboweni, but the tax rebates were a surprise and no one saw it coming. 

Despite that, the government has decided to implement a number of projects in the Budget. 

And Mboweni remained calm on the podium. He presented an aloe ferox as an indication that the country can withstand the tough road ahead. 

“The aloe ferox survives and thrives when times are tough. It actually prefers less water. It wins even when it seems the odds are against it,” he said.

This was a less diplomatic way to say to the country, fasten your seatbelts, the ride is going to be less enjoyable. 

Wearing a grey suit, white shirt and the red tie that Lubisi helped him with, the public could not see his shoes at  the podium. Maybe just as well as the shoes were not the odd pair he donned last year to express the country’s economic crisis – stable and reliable, but not necessarily nice to look at.

This time they were clean, polished and businesslike.

But they failed to disguise the tough choices he had to make in his Budget. 

To ease tension in the House, Mboweni quoted from the Corinthians I, Chapter 9 verse 24 to signal how they plan to turnaround the economy.

“Do you not know that those who run in a race all run, but only one receives the prize? Run in such a way that you might win.”

But it will not be an easy road for Mboweni and the Cabinet.

Mboweni was candid in his Budget Speech, and did not signal that there are any green shoots in the economy. 

Before and during his Speech, there was a march outside Parliament from those who believe that they have been excluded from the Budget.

His Budget speech might have been less challenging than the State of the Nation Address, which was disrupted.

But Mboweni stuck to the script and did not spring surprises outside of his Speech, except when cracking a joke with the MPs. 

The Budget might have been delivered yesterday, but the real work begins now, with decisions to be implemented.

BUSINESS REPORT

Finance Minister Tito Mboweni receives special attention from director-general in the Presidency Dr Cassius Lubisi during the Cabinet meeting yesterday morning.  I  ELMOND JIYANE GCIS

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