MTBPS: Godongwana should address SA’s economic slump, joblessness – Cosatu

Cuts he will make but the jury is still out on how much Finance Minister Enoch Godongwana will push belt-tightening in his medium-term budget policy statement (MTBPS) on Wednesday.

However, the former trade unionist gave some hope that it will be a snick rather than a gash.

He had to choose between addressing fiscal reality and unprecedented outright criticisms from a chorus of leaders within his ANC allies who cautioned him to not even think about reducing public expenditure.

But a stable growth strategy, security, energy availability and stabilising finance are what economic development experts want.

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A recent report by the Centre for Development and Enterprise (CDE) says government should focus on the rule of law, addressing the crises in energy and logistics, and stabilising public finances.

“The essential precondition of growth in South Africa today is that you can’t start to rise until you have stopped falling,” says the CDE report.

But Godongwana is in a dilemma, having to embark on a strict belt-tightening exercise on the eve of a crucial elections in which the governing ANC was anticipated to fall below 50% threshold for the first time since Nelson Mandela’s historic 1994 electoral victory.

‘Sense of general despair’

Congress of South African Trade Unions (Cosatu) spokesperson Matthew Parks said Godongwana’s MTBPS should be an opportunity for him to plug the gaps to grow the ailing economy, slash unemployment and start building the state capacity to deliver the goods.

The union federation cautioned the minister that cuts were not the solution to get the country out of its financial quagmire – but a working plan to grow the economy was the answer.

Parks said Cosatu hoped Godongwana would address the economic slump and joblessness.

“The minister must act to deal with the 42% expanded unemployment rate, 60% youth unemployment rate, the stagnant economic growth and the endemic corruption across the state and society.

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“The government should do more to address load shedding, including giving more support to Eskom which had begun to turn the corner of scheduled national blackouts. It could no longer ignore the widespread cable theft, collapsing state-owned enterprises and dysfunctional municipalities.

“There is a sense of general despair. We just hope the government will not tinker this time around, we hope it will not take the National Treasury’s approach of simply thinking that they will reduce expenditure and interfere with the public servants,” Parks said.

Cosatu urged the government to adjust the levels of inflation and expand the presidential job creation programme to more opportunities for the many unemployed youth