Finance Minister Enoch Godongwana delivers the Budget Speech for 2023 to Parliament on Wednesday afternoon. Godongwana has dubbed this budget a non-austerity budget, adding that this is a budget that makes tough trade-offs in the interests of the country’s short-term and long-term prosperity.
Many say the Minister could have done much more to help poor South Africans, especially with the extra R93 billion in revenue.
The Economic Freedom Fighters president Julius Malema says the measures announced by the Finance including tax relief for solar panels, will not benefit poor South Africans. He says the approach is elitist as the majority of South Africans do not fall into that tax bracket.
Malema has also criticized the extension of the social relief of distress grant. “It cannot be that we always annually celebrate that there’s R30 billion or so to be spent on R350. We should be speaking about reducing that amount because so many jobs have been created, solutions that are practically impossible to implement.”
The Freedom Front Plus says South Africa is in deep trouble economically. The party says the increase in the national debt to R5.8 trillion is not affordable.
Party leader Pieter Groenewald says South Africans should not be fooled by the announcement that SARS has collected an extra R93 billion.
On taking over R250 billion of Eskom’s debt, Groenwald says the Minister had no choice. “Yes, we have no choice. We have to solve the energy crisis and therefore the Eskom situation is a matter of importance and urgency … we are paying for all the billions that have been stolen.”
Below are political parties’ reactions to the budget speech:
The Democratic Alliance has described Godongwana’s budget speech as a missed opportunity. The party says it is time State-Owned Enterprises are privatised to ease pressure on the national fiscus.
On debt relief of R250 billion for Eskom, DA Finance spokesperson Dion George says this is the wrong model. He says this means there will be no incentive for Eskom to be more efficient, whereas the national debt will increase. George adds that the minister could have used a number of measures to ease the economic hardship on South Africans.
“What he could have done he could have cut the fuel levy completely. He could have scrapped that fuel levy … which would have made the price of petrol less expensive. …This was not a bold budget. It was a missed opportunity.”
Meanwhile, the African National Congress (ANC) says the measures announced by Finance Minister Enoch Godongwana will go a long way toward growing the economy and creating jobs.
ANC MP Hope Papo says infrastructure development and support for the expansion of agriculture will help with job creation. Papo says taking over the debt of Eskom will help it to deal with ending load shedding and increase its participation in renewable energies.
“We cannot let Eskom falter because if it’s allowed to falter because it cannot access resources in the financial markets, it cannot access resources. It becomes very very serious … for Eskom to function properly.”
Nqabayomzi Kwankwa of the United Democratic Movement says Eskom’s problems will not be resolved if the causes are not addressed.
“We think that by not addressing the underlying problems by not making sure that we get back money that was wasted through state capture back into the system… the grandmother, the people who run the spaza shop … ”
Gordhan welcomes Eskom’s debt relief
Public Enterprises Minister Pravin Gordhan has welcomed Eskom’s debt relief of R254 billion announced by the Finance minister in his Budget speech.
As of December 2022, Eskom’s debt stood at R422 billion from R396 billion at the end of March 2022.
In a statement, Gordhan says that debt relief is Government’s commitment to turn power utility around.
BLSA CEO Busisiwe Mavuso elaborates, “And it was a sensible budget which tried to make sure there was something for everyone in it. There was something for SMMEs, there was something for businesses broadly, there was something for grant recipients, for employees for homeowners. It was really balanced and the markets will react positively because he addressed the country’s critical problem areas while maintaining fiscal discipline.”