Gordhan 'struggling with budget'

Cape Town - In less than a week's time South Africans will know the full impact of the recession on the country's economic prospects.

On Tuesday Minister of Finance Pravin Gordhan will deliver his first ministerial medium-term budget policy statement when he lays out the economy's precise predicament.

Thaba Mufamadi, chairperson of the standing committee on Finance, on Wednesday told a joint sitting of the parliamentary finance committees that everyone should have a thought for the Minister of Finance: "He is struggling."

"Gordhan is currently behind closed doors with his cabinet colleagues, trying to convince them where cuts are necessary."

Neither Treasury director-general Lesetja Kganyago nor South African Revenue Service Commissioner Oupa Magashula was willing to divulge anything about what the country could expect before Gordhan's budget speech on Tuesday.

However, Nhlanhla Nene, Deputy Minister of Finance, stressed on Wednesday that the country was still experiencing difficult times. "The decline in tax revenue could not have come at a worse time for South Africa, especially as we are faced with sustainability challenges."

Last year Sars fell R2.5bn short of its revenue target. The current fiscal year's deficit is already some R70bn.

Kganyago said that government institutions are also going to suffer hardship, because they won't get money easily. "Some will be surprised: they think if they have asked for money in the past we owe them money. That's not so."

At the end of the past fiscal year government had to borrow R50.9bn - R200m more than initially projected.

- Sake24.com

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