Democratic Alliance (DA) Shadow Minister of Finance Dr Dion George said on Wednesday that Finance Minister Enoch Godongwana’s 2024 Budget Speech was the African National Congress’s (ANC’s) bail-out budget, adding that the ruling party lacked political will.

Godongwana presented the last budget of the sixth democratic administration, where he said that the country’s fiscal strategy supports economic growth and reduces risks to the economy while ensuring fiscal sustainability.

He explained that compared to a year ago, the budget deficit for 2023/24 was estimated to worsen from 4% to 4.9% of gross domestic product (GDP).

The higher budget deficit means that debt-service costs in 2023/24 have been revised higher, by R15.7-billion, to R356-billion, he said.

“The Minister of Finance's annual Budget is another indication of a panicking ANC government that has no plan to accelerate economic growth, resolve relentless blackouts, stabilise debt, rein in runaway expenditure, support vulnerable South Africans and combat corruption,” said George.

He said the DA noted the Minister’s announcement of government’s support for private-public partnerships to rebuild South Africa’s crumbling infrastructure, however, it said there was a notable absence of a coherent plan to fast-track this initiative.

“Government has further adjusted its growth forecast downward to 0.6%, significantly impacting revenue collection and the funds available for service delivery – revenue is R56-billion lower than expected this time last year,” said George.

He noted the Minister could have focused on stimulating growth and he had not done that, saying a reduction in growth would be witnessed. He added that this meant that there would be less revenue and that there would be a widening deficit.

He said Godongwana completely ignored South Africans.

“He did absolutely nothing for South Africans battling the never-ending cost of living crisis. He did not do anything to increase the child grant, except by adding a very small amount. It is not sufficient. The DA proposed a much bigger amount because we need to make sure that our children get more nutrition,” said George.

He suggested that the Minister could have cut the tax on fuel to make food less expensive, or he could have expanded the zero VAT rated food basket.

“So this was the Budget that completely ignored South Africans; what it was, was basically an ANC election Budget that looked at not cutting back the public sector wage bill because that is not politically possible. They chose the ANC rather than the people of South Africa,” he added.

MISGUIDED SPENDING

Meanwhile, ActionSA president Herman Mashaba noted that Godongwana’s Budget Speech was uninspiring and continued with the “misguided spending priorities of the uncaring ruling party ANC”.

“This is the Budget of a ruling party which has run out of options after decades of ​​mismanagement and dismal economic growth. As a result of their failed governance, South Africa is now unable to direct resources to the priorities that we so desperately need to address,” said Mashaba.

He explained that this was another missed opportunity that showed that the ANC lacked the political will to cut funding from non-strategic programmes, such as the R3.7-billion VIP protection budget.

“We cannot afford more of the same. South Africa’s economy needs urgent, innovative interventions to get us back on track. Real GDP growth is expected to come in at 0.6% for 2023, entirely insufficient to grow the economy, the tax base, and to create jobs. The budget deficit is growing despite repeated broken promises that it would decline, and debt servicing costs are expected to consume more than 20% of available funds,” he said.

Mashaba said it is unsurprising that the Budget offered struggling consumers little relief from rising inflation, while failing to make any significant additional allocations to strategic priorities, including infrastructure development and education.

He said that it was deeply concerning that at a time of budgetary cuts along frontline services, the ruling party had decided to allocate an additional R200-million towards political party funding of which it will receive the largest share.

“This is again a tell-tale sign of the ruling party making use of State resources to benefit itself and its supporters in order to retain an electoral majority in the upcoming elections,” said Mashaba.