Finance Minister Enoch Godongwana’s generosity in his budget on Wednesday was not enough to impress the ANC’s alliance partners.
The Congress of SA Unions (Cosatu) shot it down as an “extremely disappointing budget and a repeat of the old promises”.
Cosatu’s national spokesperson Sizwe Pamla said: “An expected growth trajectory of 1.8% of GDP over the [medium-term expenditure framework] will see no reduction in unemployment.
“Overall, this was an extremely disappointing budget that repeated old promises, continued its austerity trajectory and was devoid of new policy interventions to solve the problem of economic stagnation.”
He said Cosatu believed the central ideas in the budget were not aimed at increasing the economy’s labour-absorbing capacity.
There was no plan to restore the economy or create jobs, no plan to fight corruption, and no plan to stop the leakages that led to 10% of the budget being lost to corruption.
The state-owned enterprises had no financing model, municipalities were still teetering on the brink, and austerity was still being imposed on rural development – sabotaging land reforms – the Mediation, Mediation and Arbitration Commission and the Ministry of the Interior.
Cosatu’s sentiments were shared by the Democratic Alliance (DA). DA Finance Minister Dion George said Godongwana’s projected average GDP growth of 1.8% over the next three years was insufficient to address SA’s high unemployment rate, which hit 34.9 in the third quarter of last year. % reached.
George said that while the party supported temporary public employment initiatives to provide relief, that was not a sustainable approach to creating permanent jobs in the economy.
While acknowledging that the budget provided a welcome but cautious account of the state of SA’s fiscal trajectory, George denounced rapidly rising public sector wage costs, escalating public debt and scant details about state-owned companies.
“As long as the government continues to push wage bills, the threat of a budget blowout remains high.
“Clearly, the explosive growth in state spending driven by wage demands in the public sector and unions, as well as the radical economic transformation faction in the ANC, clearly will not allow the government space to contain these rising costs,” George said. .
Despite painting a rosy picture of public debt consolidation, it continued to rise and will reach R4.35 trillion in 2021-22.
“This is enough to set alarm bells ringing.
“But the government continues to show a lack of urgency. Instead, it may choose to clear the debt.”
The sugar industry is disappointed by Godongwana’s announcement that the health promotion tax will be increased from 2.21 to 2.31 cents per gram of sugar.
Andrew Russell, SA Canegrowers chairman, said: “This walk will threaten thousands more rural jobs.” He said they would request a meeting with the minister to ask him to change his mind.
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