File photo: Rogan Ward/Reuters
Cape Town - Cosatu is warning the government to fix the economy before the budget in February next year, to avoid being forced to go to the International Monetary Fund (IMF) with cap in hand.

The trade union federation on Friday said the economy deteriorated in the last few months and going to the IMF remained a possibility and that would lead the country to surrender sovereignty.

This comes as civil society organisations complained about hundreds of millions of rand in under-expenditure in government departments.

Cosatu and civil society organisations were presenting to the appropriations committee on the mini budget tabled by Finance Minister Tito Mboweni in October.

Matthew Parks of Cosatu said the debt was sky-rocketing and the government was unable to control it.

The debt is approaching 70% of the Gross Domestic Product (GDP).

Mboweni warned that in order for debt to be manageable it had to be below 30% of the GDP.

But in South Africa it was R3trillion at the moment and would rise higher in the next two years.

Parks said the government needed to get the economy right.

“We view the debt crisis as extremely dangerous.

“It puts our sovereignty in crisis.

“As the ruling alliance we will be occupying the Union Buildings, but the IMF will tell us what to do,” said Parks.

The Budget Justice Coalition and the Rural Health Advocacy Project said underspending in government was a serious concern.

This was against the pressing need to provide basic services to the poor.

Andile Cele, Budget Justice Coalition co-ordinator, said the budget cuts implemented by the National Treasury had an impact on service delivery.

She said there was no need to take money away from education and health care.

She said there was underspending in several government departments.

Cele said departments underspent by R3.9bn.

Cele said R700m was underspent in the police, the department of health underspent by R346m and water and sanitation underspent by R250m on the bulk infrastructure.

The other underspending came from other departments to make up the total of R3.9bn.

Kirsten Pearson of the Rural Health Advocacy Project said the underspending of R346m in health was a cause for concern.

She said these were significant amounts of money. “It is noted that R346m was declared unspent in the 2019/20 adjusted budget for health,” said Pearson.

Political Bureau