Prof. CT Msimang, MP
Our country faces numerous and steadily increasing economic challenges. Our macro environment is characterised by continuing low economic growth, high unemployment, an on-going energy crisis, poor basic service delivery and a weakening developmental infrastructure. The above exacerbates social inequalities such as poverty, health, education and crime and leads to an ever worsening situation.
How do we correct this downward spiralling trend? We pursue the path of job creation! We create an environment that lends itself towards entrepreneurship. We create an environment that supports the small businessperson, provides him or her with easy routes to start-up capital, the necessary tax breaks and an overall environment of small business nurture. We create opportunities for employment.
Honourable Speaker, we see an approach by government which is slanted towards the receiving and redistribution of fiscal revenue rather than one of creating a sustainable environment in which the economy can grow and flourish. This cannot continue. It is not sustainable – it is an approach that will ultimately lead to a failed state.
Greater impetus must be focused on deregulation, the labour crisis and the removal of taxation that targets capital formation and investment viability. The burden of government must also be ruthlessly addressed and reduced yet in this budget we see the opposite, namely, the burden of government increased!
Yet even with these increases, there is no parity of increase in basic services output because of the continuing rampant incompetence, corruption and general ineptitude that has come to characterize our public services.
Economists are also noting with great concern the continuing issue of parastatal recapitalization; parastatal deficits cannot continue to be financed by government budget and bailouts.
This together with our mooted and quite unaffordable expansion into greater nuclear energy capacity and public sector wage bill increases only take us further along the road to a solvency crisis in South Africa.
And we must not punish savings and investment through greater taxation as these are both important keys in unlocking future growth.
Honourable Speaker, the budget must not be seen as a universal panacea by government which will magically alleviate all of the country’s economic problems, but rather as catalyst to positive enhancement of opportunities for growth through the provision of services, infrastructure and greater job creation.
I thank you.
Prof CT Msimang, MP on 082 452 2650
IFP Media, Parliament