Finance Minister Enoch Godongwana must send a clear message that poorly run state-owned enterprises (SOEs) should not be entitled to more money.
This is the view expressed on Tuesday by Western Cape Premier Alan Winde, ahead of the Medium-Term Budget Policy Statement (MTBPS) on Wednesday.
The MTBPS takes place halfway between the Budget speeches, held in February. It provides the country and its elected representatives with an update on the National Treasury’s economic forecasts, adjusts the budgets of government departments, and makes emergency changes to spending.
“The choices the national government makes in this adjustment budget will set the tone for the main budget next year,” said Winde.
“It is more vital than ever that Minister Godongwana holds the line on throwing good money after bad, and sends a clear message that poorly run SOEs should not be entitled to yet more money.
“The minister and national government must place the needs of our residents above those of the country’s failing SOEs” said Winde.
Finance and Economic Opportunities MEC Mireille Wenger said Godongwana must deliver an adjustment budget that prioritised service delivery.
Wenger said while it was appreciated that the minister was walking a tightrope, it was time to focus on protecting front-line services including schools, hospitals, and the support for the most vulnerable.
“The last thing South Africa and the Western Cape needs is for failing SOEs to be propped up at the expense of the provinces’ ability to deliver on their constitutional mandates.
“Borrowing yet more good money to throw after bad is definitely not the answer.
“We need every available rand to be working for the people of South Africa – and that starts with stemming the haemorrhaging by failing SOEs, which are responsible for growth-critical sectors, such as logistics and electricity supply. We need to get our country working again,” she said.
According to Winde, they will also be monitoring any intention to cut funding to provinces through the Provincial Equitable Share.