The annual Budget Speech has come and gone, delivered by Finance Minister, Enoch Godongwana, at Cape Town City Hall, during the afternoon of Wednesday, 22 February 2023.
This year's speech was anticipated to be tense as many wondered how the Finance Minister would address South Africa's mountain of issues that are directly impacting our economy, most notably the severe loadshedding and rising unemployment crisis, which has left many frustrated and in a state of despair.
COSATU is one such group that is voicing their disapproval with this year's budget speech.
The Congress of South African Trade Unions (COSATU) has criticized the Finance Minister's inability to expand the Presidential Employment Stimulus (PES).
The PES was introduced in 2020 as one of the measures combat the detrimental effects of the Covid-19 pandemic, and has since benefitted over 1 million people. The purpose of the PES is to generate jobs and sustain living standards during the pandemic, through the use of public funds.
In a statement released the same day that the Budget Speech took place, COSATU stated that "It is lamentable that the Presidential Employment Stimulus has provided work opportunities for 500 000 young people but has not been expanded to accommodate more young people."
Unemployment is one of South Africa's most pressing issues, with the youth unemployment rate being particularly worrying. Although the PES has certainly helped many South Africans, COSATU is of the view that more can be done.
COSATU also labelled the speech as "uninspiring and jaded", claiming that the South African government has either forgotten or abandoned the commitments it previously made to its citizens.
"Whilst there are some positive budgetary allocations, it is depressing to note that the budget continues along the same neo-liberal trajectory that has led to the current crisis," reads the statement. The "neo-liberal trajectory" is in reference to the National Development Plan (NDP) adopted by the ANC government eleven years ago.
According to COSATU, the NDP set out "noble objectives, including eliminating poverty, and reducing inequality and unemployment" amongst the rising socio-economic challenges South Africa faces, but is no longer viable.
"COSATU has consistently warned the government that it was wishful thinking to pursue such transformative objectives whilst persisting with the NDP’s Neoliberal macroeconomic straitjacket and with no clear interventions to structurally transform the economic base," continues COSATU.
COSATU Spokesperson, Sizwe Pamla, said the trade union federation believed the country was facing at least five critical challenges, against which the Treasury’s tax and spending policies must be measured.
These challenges are rises in extreme poverty, remarkably sky-high levels of unemployment, rising multi-dimensional and intersecting inequalities, shaky economic and social infrastructure, corruption and widespread crime.
“For far too long, the government’s persistence with Neo-liberal macro-economic fiscal and monetary policies has been dismal against this yardstick. COSATU expects a people’s Budget to take forward redistribution and social delivery outlined in the ANC resolutions and various manifestos,” said Pamla.
COSATU is also of the view that government should rebuild its relationship with public servants, as (according to COSATU) most public servants are "disillusioned, overworked, highly indebted, and underpaid," pointing out the 4.5% salary increase for members of Cabinet and Parliament, while the wage bill has a projected increase of 3.3%.
"It is obvious that they are intent on balancing the books by pickpocketing nurses, teachers, and other hard-working public servants," read the statement.
Pamla said COSATU wants the Budget to be "transformed into an effective tool for economic revival, transformation, and improved service delivery, becoming a developmental tool that prioritises pro-poor social expenditure and adopt increased progressivity of taxation."
"The budget does not provide hope of a decisive set of bold interventions that will jolt the economy from a projected growth of 0.9% in 2023, 1.5% in 2024 and 1.8%. It is self-delusional to believe that a timid budget will spur the economy to grow and slash unemployment," stated COSATU.
