JOHANNESBURG – Finance Minister, Tito Mboweni will table the 2019/2020 financial year budget at a time of heightened anxiety about South Africa’s economy.
The numbers simply do not look good. Low growth projections, high unemployment (particularly amongst the youth), escalating inequality and a steady climb of debt-to-GDP with National Treasury worryingly forecasting this to reach almost 60 percent in 2023/24 – surely to trigger IMF and World Bank interventions.
The resultant consequence has been the regressive increase in debt servicing costs which now stands at R180 billion annually.
From President Cyril Ramaphosa’s State of the Nation Address (Sona) it was very clear that government, buoyed by election fever, was over promising with high-level plans while anchored in low-level efficiency. The realities of the upcoming budget will be a moment of sobriety in comparison to the utopic honeymoon promises of Sona 2019.
And this is precisely why this budget needs to move away from the misguided rhetoric of the governing party and present a pragmatic economic agenda of plans and solutions with a bias towards growth, development and sustainability. It needs to be a responsible budget, not an election budget.