Minister of Finance Enoch Godongwana delivering the 2024 Budget Speech in February. Picture: GCIS
Finance minister Enoch Godongwana announced the fiscal directives his office will be undertaking in the coming financial year.
Beginning with the nation’s debt, the minister revealed that the country’s deficit currently exceeded R5 trillion and that at least R380 billion must be spent just on debt repayment.
Although he admitted the fiscus was under strain, Godongwana said the department’s performance over the previous financial year presented positive reading.
Godongwana’s plan to bring about financial prosperity via his department featured six key imperatives.
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Supporting infrastructural and economic development while better managing government assets would be amplified by streamlining government procurement and ensuring better overall financial management.
To make these points possible, promoting regional and international cooperation and improving the tax system sat at the top of his six-point plan.
“The department has a budget of R3.3 trillion over the medium term, of which 57.9% is for transfers to provincial governments for the provincial equitable share,” the minister stated.
Red tape and political will have often been cited as stumbling blocks to having the private sector play a greater role in economic growth.
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The finance minister, building on an initiative announced in February to revise regulations, reaffirmed his department’s intentions to lessen this hinderance.
“These comments are currently being considered and I will be gazetting new regulations aimed at streamlining the administrative process, reducing the timelines and providing for a systematic approach to unsolicited proposals,” said Gondongwana.
Targeting five major metros, but excluding the City of Johannesburg, Godongwana announced a focused strategy aimed at township economies.
“This is expected to result in 35 catalytic projects over the medium term in strategically targeted areas within metropolitan cities, intermediate cities and rural towns,” he said.
The Financial Action Task Force (FATF) is a French intergovernmental organisation that rates a nation’s money laundering and terrorist funding activities.
South Africa is on the FATF’s grey list and have been given directives by the FATF on how to improve the listing using the country’s tax system.
To achieve this, Gondogwana’s department has allocated R31.2 million for a tax and financial regulation research programme, R7 million of which coming from this year’s budget.
