Johannesburg - Finance Minister Tito Mboweni’s first Medium-Term Budget Policy Statement (MTBPS) has been criticised by opposition political parties for not going far in dealing with the growing debt levels and a concerning public sector wage bill.
The rising debt levels were top of the agenda for political parties, along with the billions of rand that will be pumped into state-owned enterprises such as SAA and SA Express.
EFF deputy president Floyd Shivambu said he was concerned that there did not seem to be a clear plan to deal with rising debt levels.
He criticised the focus on government spending on the public sector wage bill and said there were a number of unnecessary expenses that could be cut and that could save the government money.
“We do not think what the minister said will rescue SA from the position it is in now. There is no strategy of reigniting economic activity. There seems to be no plan to deal with rising debt levels. You can decrease government spending by reducing the reliance on consultants,” said Shivambu.
The DA’s David Manyier said the projected amounts to service the country’s debt would mean the government would be spending far more on servicing debt than it does on any other services such as policing.
“Mboweni’s, 'maiden' MTBPS reveals a full-scale budget blowout, which is clear evidence that the “new path” of economic growth, employment and transformation has failed in South Africa.
“What this means is that debt service costs will skyrocket to a staggering R247 billion in 2021/22, which is R148 billion more than we will spend on police, R55 billion more than we will spend on social grants, and is equal to what we will spend on basic education this year, 2018/19, in South Africa,” said Maynier.
Steve Swart from the ACPD said: “Minister Mboweni had very little fiscal room to move given the technical recession we have experienced. He has committed to adhere to fiscal sustainability in order to reign in the spiraling public debt levels, and instill confidence in investors and ratings agencies. While the expenditure ceiling, the anchor of fiscal policy, remains intact, we are concerned at the fiscal slippage since February’s budget”.
Cope leader Mosiuoa Lekota said he was concerned about government’s plan to pump R5 billion into South African Airways (SAA) and a further R1.2 billion into SA Express while they were struggling to stay afloat.
He said pumping money into institutions without ensuring that those who are corrupt are not in charge of spending would be fruitless.
"Whatever he can do does not go to the heart of the problem we are faced with. We need to do something about the manpower that is stealing this money. When we go and borrow money and give it to people who are stealing the money it is fruitless,” said Lekota.
ANC treasurer Paul Mashatile said the ANC welcomed the budget and the spending that would support economic growth and employment.