Finance Minister Enoch Godongwana identified port corporatisation as one of the areas for critical implementation when he delivered his Medium Term Budget Policy Statement (MTBPS) yesterday.
And while there are widely differing opinions depending on which side of the fence you’re sitting on, Business Unity SA (Busa) has given it a resounding thumbs-up, in particular the statement on the need for structural economic reforms to generate economic growth.
“We have been beating this drum for the last five years and thus strongly endorse this,” said Busa CEO Cas Coovadia.
“He emphasised the country cannot deal with numerous challenges without growth. He also emphasised the need to manage our debt, with debt service costs now higher than the budget for health.”
Coovadia said Godongwana had been consistent, since his appointment, in underscoring the need to be prudent in the current climate. “He has been clear that the critical issue for the country is to create an environment for investment and growth, and the country cannot afford to commit to any expenditure the fiscus cannot afford.”
A cause of concern, said Busa, was the impact of the public service wage bill.
“The minister indicated the budget ceiling for compensation of public servants had been breached by R20.5 billion,” said Coovadia.
“He warned that if the honouring of the public service wage agreement became too great, government might need to shift funds from the Infrastructure Fund to meet such increases.”
Coovadia said this was cause for serious concern, particularly at a time when growth-enhancing infrastructure spend was critical for economic growth and job creation.
Godongwana’s focus on port corporatisation, spectrum release, ongoing REIPPPs, digital migration, energy and water as critical areas of implementation was also a cause for celebration, he added.
“We agree with this and would add that issues like expediting mining exploration licences and other immediately actionable actions to increase confidence in our economy are also critical.”
Along with the majority of commentators, Busa welcomed Godongwana’s commitment that new allocations had not been made to SOEs.
