Durban - Business Unity South Africa (BUSA) has said that following minister Tito Mboweni's medium term budget speech, it was clear that he understood the magnitude of South Africa's financial crisis, but that the rest of government did not.
Mboweni tabled his Medium Term Budget Policy (MTBP) statement in parliament on Wednesday afternoon. Among other things, the minister said that the country's budget deficit would average 6.2 % and, with its debt and debt-service costs continuing to rise, the debt to GDP ratio wold reach 71.3% in 2022/23.
"Unfortunately, while the Minister of Finance has identified that South Africa 'spends more than it earns'; that 'things need to be done differently'; and 'there is no time left to act'; there is little that indicates the rest of government understands the seriousness of the economic crisis. BUSA recognises that given the state of the country’s economy and treasury, the minister’s options were constrained," said the organisation.
While Mboweni recognised that government could not continue to throw money at Eskom and other state-owned enterprises, it was yet to present a clear plan to resolve the financial crisis at the power utility, said BUSA.
Additionally, it was "deeply" concerning that Eskom board member Busisiwe Mavuso told a parliamentary committee hearing on Tuesday that the board was under political pressure to avoid making difficult business decisions.