20 February 2002
POSITIVE ASPECTS
The South African Communist Party (SACP) welcomes the following aspects of the Budget presented by the Minister of Finance, Trevor Manuel, in parliament today.
The SACP regards these aspects of the budget as positive. The SACP also welcomes the contextualisation of the Budget by the Minister. The Minister correctly noted the global economic situation insofar as it is promoted as a provider of endless opportunities whilst in effect it has resulted in the continued marginalisation of most of Africa and the developing world. Any budget in such a situation has to grapple with this reality and must be geared towards overcoming the marginalisation of our continent and people. This contextualisation of the budget lays the basis of positioning future budgets in ways which are closer to the need to meet the basic needs of our people whilst at the same time building a state which increasingly intervenes in the economy and mobilisat. This is the kind of perspective the SACP has called for in the last few years and which we will take forward in preparations for the growth and development summit.
OVERALL COMMENT
However the SACP believes that the main thrust of this budget is still heavily hemmed in by insufficient allocation of funds and attention on building institutional and human resource capacity. Structural impediments in spending hinder any positive effects increases in expenditure may have in the real economy. These impediments have also resulted in under-spending and rollovers in many government departments. This lack of capacity reflects excessive macro-economic discipline in previous years such that we may now have a lean and mean state without capacity.
The use of the increased allocations in education, health and infrastructure investment depends on improved institutional and human resource capacity in the public sector. This therefore means that the current macro-economic regime must be reviewed. Hence the importance of the growth and development summit which must, amongst other things, ensure that next year's budget can reflect new macro-economic policy considerations.
The SACP is also concerned about the continued inclusion of proceeds from privatisation into the budget calculations in the context where there are massive problems associated with the current restructuring of state assets and that there is no alliance agreement on the current restructuring of state assets.
The increased social grants are inadequate insofar as the need for a comprehensive social security system is required and the fact that they will not address the massive price hikes of food. In this regard, the SACP would have expected the budget to include zero-rating of basic foodstuffs in order to cushion the poor. It is also for this reason that the SACP believes that government must provide clarity and direction on what steps it is taking to effect a comprehensive social security system including the provision of a Basic Income Grant.
The SACP also believes that the massive R15 billion cut in personal income tax is regressive as it gives more to the rich than it gives back to the poor.
Finally, the SACP seeks to underline the need to democratise the budgeting process so as to ensure that ordinary people and civil society organisations also contribute to the budgeting process.
CONTACT
Mazibuko Kanyiso Jara (surname Jara)
Department of Media, Information and Publicity
South African Communist Party
Tel - 011 339 3621
Fax - 011 339 4244
Cell - 082 922 5716
Email - sacp1@wn.apc.org