Finance Minister Malusi Gigaba’s maiden Medium-Term Budget Policy speech was unimpressive. In fact, it seemed a mere rehash of his predecessors’ old proposals.
He was so non-committal, that there is very little hope that we will soon see agencies rate South Africa higher than ‘junk status’. The reaction of the Rand, to his speech, might be a sign of worse things to come.
The United Democratic Movement (UDM) notes that South Africa’s current debt stands at R2.32 trillion, whilst the 2020/21 forecast is at a chilling R3,4 trillion. Our debt service cost stands at R146.5 billion per annum, with the projected cost (in just three years’ time) at R223.4 billion. This is cause for serious concern. Minister Gigaba’s lukewarm proposals and vague statements did not speak to this existing, nor the looming – even bigger – financial crisis.
The reality of the situation is that Minister Gigaba, and therefore the Country, has become the victim of the mess he created whilst he was still Minister of Public Enterprises. The calamitous management of many State-Owned Enterprises (SOEs), like Eskom and SAA, happened on his watch. Might Minister Gigaba have been non-committal in today’s speech, because he is walking on egg shells, trying to appease both factions of the African National Congress going to their elective congress in December?
The UDM however does commend Minister Gigaba on the steps he has taken to improve governance at SAA. We hope that things change for the better.
Regarding SOEs, the UDM had warned in the past that Government’s over-commitment in terms of contingent liabilities is a recipe for disaster. Those warnings were laughed off and we see Minister Gigaba and his department scrambling and wanting to channel funds away from service delivery. What’s the use of doing a people-driven budget, if you don’t stick to it?
Minister Gigaba’s commitment, to combat corruption and curb wasteful expenditure, has the credibility of a cat conducting a commission of inquiry into the disappearance of mice.
Mr Nqabayomzi Kwankwa, MP
UDM Deputy President and Chief Whip