Budget Vote Debate- Extended Public Committee
Prof CT Msimang , MP
Even the best minds in finance are saying that they have no clue where the global economy is going! Global economic growth remains in a state of uncertainty and is worsening as even we see our developed world central banks being left with less and less resources with which to prop up their respective economies.
It has been said by one economist that, “The growth model of the advanced world is getting exhausted, and the emerging world is getting contaminated”.
Make no mistake about it, a global recession is a very real possibility and the emerging economies are where the developed world will be looking to provide demand to support their growth.
It is against this backdrop and the backdrop of our own domestic challenges that the Department must diligently perform its constitutionally mandated task and objectives of steering fiscal policy and coordinating macro-economic policy.
Every fiscal rand earned must be well spent. State owned Companies and their current high degree of mismanagement are shining examples of money not well spent and are simply a drain on the fiscus.
Reducing our high levels of debt and ensuring fiscal consolidation through budget deficit reductions must be an ongoing process as this is one of the pillars of sound fiscal management. It gives us immense confidence that under the current Minister this will be done and this was further entrenched by the favourable news of the two year extension of Treasury director-general Lungisa Fuzile’s contract. Mr Fuzile is a known quantity, has proven himself in the position and we are confident that by his appointment our path towards fiscal consolidation will continue.
Honourable Chairperson, treasury has the unenviable task of meeting almost unlimited fiscal needs with limited funds. It must therefore ensure that through its allocation of budget the country’s social and economic needs are met and that the ground is laid for maximization of economic growth. Infrastructural supply side constraints must be eliminated or reduced as effectively as possible.
The SARS Strategic plan and APP must be finalized – It is also imperative that SARS and Treasury resolve their apparent differences and start working together. Division will not assist the country.
The imminent threat of a sovereign ratings downgrade and its intendant higher borrowing costs on a borrowing Bill currently sitting around 140bn per year is cause for grave concern. This mind set of earning R1 and spending R2 will not do the country any favours!
Belts must be tightened, the immense fat of cabinet significantly trimmed, - corruption, incompetence and mismanagement ruthlessly eradicated. Effective, efficient, transparent service delivery must be the order of the day with sound and strategically competent departmental allocations coupled with vigilant oversight being the Sine qua non.
The Inkatha Freedom Party supports the budget vote.
I thank you.
Prof CT Msimang, MP
082 452 2650
IFP Media, Parliament