By Dr Mark Burke MP, DA Spokesperson on Finance
For seventeen years, South Africans have suffered a seemingly endless economic drought.
Growth forecasts have steadily declined, debt has surged, and ratings downgrades have followed.
For seventeen years, we’ve also been sold stories that things are changing. We have been promised New Dawns and GNU dawns.
Greenshoots that have turned into shoot overselves in the foot (during loadshedding) moments.
So when the rumblings of fiscal hope were heard in news sites across the country, starting with our exit from the greylist and echoing after the MTBPS and G20, no one can be blamed for being a bit cynical.
The first sign of this new wave of hope was perhaps our exit from the Financial Action Task Force’s (FATF) greylist.
We’d been placed there 32 months ago – under an ANC majority government – after FATF lost faith in our ability to prevent illicit financial flows.
More good news flowed from the MTBPS on multiple fronts.
Firstly, SARS is expecting higher tax revenue than what was predicted in May.
This is partly supported by improvements in the gold price in recent months, relieving budgetary pressure, along with increased collection rates by SARS.
The DA can’t claim victory for this windfall, but the fact that it hasn’t all been allocated to new spending, but rather partially used to cover debt, is fully in line with party principles.
We’re gradually moving away from the dangerous trajectory of a country that borrows beyond its means.
Over the past decades, our national debt has risen from 27% of GDP in 2008 to 77.9%.
This millstone of debt around our necks has severe consequences.
The portion of the budget spent on repaying loans has grown at the expense of government services such as health, education, and infrastructure.
The National Treasury and the new Cabinet have now, quite rightly, taken the decision to curtail this mammoth borrowing binge.
For the first time since 2008, government debt will not rise as a proportion of the country’s economic output, and we’ll aim to deploy more than R940 billion to infrastructure over the next 3 years.
In 2025, South Africa faced a choice. We could have continued to drift along with the rising global tide of debt, or deliberately swim against it.
For over a decade, a government that excluded the DA let the former happen. This time, the government chose the latter.
These shifts towards more responsible fiscal policy did not happen by accident.
Before the compromise, we had the conflict of the disastrous budget attempts earlier this year.
An equally important consequence of that budget was that we’ve moved fundamentally on how we think about government efficiency.
Ghost workers, spending reviews, SETAs, and their financial abuse have entered the public lexicon and the budget documents.
These improvements in policy can’t be taken for granted.
Even though the Rand is trading at its strongest levels in more than a year, there are many – both inside the ANC and sitting in the opposition – who would like to return South Africa to the state capture model, enriching a small elite at whatever the expense, including our nation’s finances and its currency.
While a few raindrops and thunder do not break a drought, this budget and the government’s recent financial achievements should give sceptics pause.
We are allowed to hope, even if the certainty of change is not guaranteed.
Economic policy that reroutes our country from a downward spiral towards a prosperous tomorrow will not occur in a single budget cycle – but it does start somewhere.
It happens when responsible, patriotic and uncaptured people are invited into places of power, not locked out.
For as long as the DA remains in the room, we can be hopeful.
