Adjustments to government spending could redirect fiscal trajectory from the cliff towards more sustainable budgeting and provide urgent relief to battling households, says the DA.
Presenting the party’s 2023 medium-term budget policy statement (MTBPS), DA MP Dion George said their policy changes would enable South Africa’s economic growth and job creation.
“Unemployment continues to rise as business bears the brunt of unprecedented levels of rolling blackouts and rapidly increasing debt is crowding out more and more basic service delivery,” he said.
George made his presentation just two days before Finance Minister Enoch Godongwana tabled the 2023 MTBPS in Parliament on Wednesday.
He said major reforms were required for South Africa to recover and these start by removing government-imposed barriers to growth.
“A government that is effective at serving the public, limits regulation and focuses on delivering essential services.” He also said their alternative MTBPS proposed innovative solutions to attract foreign capital, encourage domestic savings, revitalise state-owned entities, fix the crumbling infrastructure, enhance labour market participation, and facilitate the expansion of both the small and large business sectors.
George said the instability of the energy supply in tandem with a volatile political climate has had a severely detrimental impact on the advancement of South Africa.
“The DA’s 2023 Alternative MTBPS is therefore anchored on a framework of fiscal prudence that prioritises the attainment of the primary budget surplus announced in February.”
Labour federation Cosatu said Godongwana said they were astounded by reckless attempts to impose misguided austerity budget cuts across government in the run-p to the MTBPS, including freezing vacancies and infrastructure investment programmes.
Acting national spokesperson Matthew Parks said: “What is needed is to grow the economy. That is the only sober and sustainable path to pay down our worrying debt trajectory. The crisis we are facing is not an expenditure crisis. The wage bill has been stable at 35% of the budget for more than a decade.”
Parks added that the crisis was a collapse in company tax because of the rapid deterioration in Transnet’s capacity to transport mining, manufacturing and agricultural products to their markets timeously.