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Cape Town - In his pre-Budget press conference Finance Minister
Pravin Gordhan described his first Budget as providing a "message of
hope and optimism".
He stressed it was a time for action in the economy. "We need all of South Africa to engage on the economic issues of the country - business, labour and civil society."
Here are the highlights of Gordhan's first Budget speech:
The economy
- Economic growth of 2.3% forecast for 2010, increasing to 3.6% by 2012;
- Unemployment up to 24.3% in 2009;
- The 2010 Fifa World Cup could contribute 0.5% of GDP growth in 2010.
To date government has spent R33bn on preparations;
- Inflation should average 6% during 2010/11;
- A budget deficit of 7.3% projected for 2009/10 and 6.2% for 2010/11;
- The deficit should reach 4.1% by 2011/12;
- Government's net loan debt projected to rise to R1.3trn in 2012/13;
- Wage subsidy for young people proposed;
- Infrastructure investment of R845bn over the next three years;
- Government will spend R52bn on public works programmes in the next three years.
Spending
- R12.2bn for social grants;
- R2.7bn on literacy and numeracy;
- R15.1bn on occupation specific dispensations (education, military, prisons);
- R2.2bn on revising SANDF salaries;
- R8.4bn on expanding antiretroviral therapy;
- R2.5bn on increasing labour intensity in public works;
- R1.8bn on clothing/textile incentives;
- R1.8bn on automotive production development;
- R1bn on the criminal justice sector;
- R2.8bn on public transport (as well as road and rail infrastructure);
- R6.7bn on covering the increased cost of providing free basic electricity;
- R2.5bn on municipal infrastructure;
- R1.5bn on the Land Bank to help rural development;
- Oold age pension increased by R70/month to R1 080;
- Child support increased by R10/month.
Tax proposals
- Personal tax relief of R6.5bn;
- No more SITE (Standard Tax on Employees);
- Fuel tax increases to total 25.5c/litre;
- Cigarettes will cost R1.24 more per packet;
- Booze up by between 6.5c (for a bottle of beer) to R2.22 (for a
bottle of spirits).
- Fin24.com