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Political parties warn Budget falls short in meeting SA’s pressing key economic demands

Minister of Finance Enoch Godongwana has a conversation with President Cyril Ramaphosa at Parliament after delivering the Budget Speech 2022. Picture: Phando Jikelo/African News Agency(ANA)

Minister of Finance Enoch Godongwana has a conversation with President Cyril Ramaphosa at Parliament after delivering the Budget Speech 2022. Picture: Phando Jikelo/African News Agency(ANA)

Published Feb 23, 2022

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Cape Town - Opposition parties have warned that the Budget delivered by Finance Minister Enoch Godongwana did not go far enough to meet some of the demands of the economy and the country.

They said it fell short of key priorities of the state with the increasing debt and high unemployment rate.

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But Godongwana said this was a solid Budget able to meet all the spending requirements without going above the threshold.

He said even with the issue of the debt it was being managed, as they were projecting to stabilise it to 75% of GDP in the next two years.

In his presentation to Parliament, Godongwana said they have revised economic growth from 5.1% to 4.8%.

However, they want to use the R182-billion windfall from revenue collection in the right areas of state expenditure.

He said part of it, a total of R44bn, has already been used for the social relief of distress grant that was extended by President Cyril Ramaphosa in his State of the Nation Address.

He said the other portion of the windfall will be used to cover debt.

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He said debt services costs were now sitting at R300bn and they were crowding out health, policing and basic education.

But the minister said they have given the police R8.7bn and this will boost its coffers to hire more officers. Ramaphosa had said the police would hire 12 000 officers in the wake of the July unrest.

The Criminal Justice System also got a boost of R1.1bn that was given to the Department of Justice and Correctional Services.

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Godongwana also announced tax rebates for the people and said there will be no increases in taxes this year.

“Madam Speaker, households and businesses are still under financial pressure and are coping with higher obligations, the effects of Covid-19 and increased fuel prices. Now is not the time to increase taxes and put the money at risk. Accordingly, we have decided to keep money in the pockets of South Africans. This budget includes R5.2bn in tax relief to help support the economic recovery, provide some respite from fuel tax increases and boost incentives for youth employment,” he said.

The DA, IFP and Good Party said Godongwana should have delivered a strong budget that focused on growth, creating jobs and dealing with the immediate challenges in the country.

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The parties said bold action was needed to craft a new path.

This would have allowed South Africa to get out of the financial crisis.

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Political Bureau

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