Ahead of Finance Minister Enoch Godongwana’s budget speech on Wednesday afternoon, a group of civil society organisations have called on government not to reduce social spending in favour of tackling the country’s energy crisis.
Budget speech 2023
The civic organisations – which include, among others; Corruption Watch, Equal Education, SECTION27, Black Sash, Open Secrets, and the Treatment Action Campaign – have gathered under the banner of the Budget Justice Coalition (BJC), a coalition that educates and encourages citizens to participate in South Africa’s planning and budgeting processes.
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The BJC raised concerns over the country’s growing inequalities and says it’s disturbing that government has over the years reduced social spending through the maintenance of an expenditure ceiling and broad fiscal consolidation.
“The BJC is concerned about the current energy crisis and welcomes the promise to permanently tackle load shedding. We, however, caution that the allocation of funds and reduction in spending to address the R400 billion Eskom debt, must not be implemented to the detriment of other rights found within the Constitution. Rights to education, healthcare, basic services, and social assistance cannot be compromised or deferred,” the BJC said in a statement.
Debt-service costs
The BJC lamented that the largest expenditure item in the 2022 budget was goverment’s debt-service costs, which stand at R333 billion per year on average.
“In effect, resources are being redistributed away from public spending to government creditors. The coalition is concerned about the choices on how to raise and allocate spending towards debt-service costs and how it’s impacting the kinds of public services delivered.
“A more appropriate mix is required given the catastrophic levels of poverty and inequality in South Africa.”
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The BJC has reiterated calls for government to implement a Universal Basic Income Grant (UBIG) to address the country’s inequalities, saying over a quarter of the population (including around 9 million working-age adults and more than 7 million children) are living below the food poverty line of R663 a month.
“This limits the ability of adults to engage in the economy meaningfully, and limits the development of children, compromising the future economy. Both the Child Support Grant (R480 per month) and the Social Relief of Distress Grant (R350 per month) are substantially below the food poverty line.
“The BJC is looking forward to seeing decisive steps in increasing support above the poverty line and clear implementation of the UBIG.”
Fair tax system
The BJC argues that taxes should be seen as a contribution to society and the common good.
The coalition said a progressive and fair tax system is fundamental to building a strong public service and a healthy, more equal economy.
“The 2023 budget is much anticipated as the country is eager to get relief from the rising cost of living, unemployment, persistent energy crisis, lack of service delivery, and crime and corruption that continues to steal from the nation.
“We hope that the government rises to the occasion, and tables a budget that is people-cantered and reflective of human rights.”
Godongwana is expected to deliver the 2023 budget speech at 2pm on Wednesday, at the Cape Town City Hall.
Compiled by Thapelo Lekabe
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