Busa seeks stronger budget message

2012-10-25 18:35 - Sapa
Johannesburg - The medium-term budget, while "balanced and realistic" should have had a stronger economic message, Business Unity SA (Busa) said on Thursday.

"It would have been helpful if more detail had been available about the fiscal road map ahead," Busa CEO Nomaxabiso Majokweni said in a statement.

She said more policy certainty and a commitment to financial targets were needed to maintain investor confidence as South Africa was in difficult economic times.

Majokweni welcomed Finance Minister Pravin Gordhan's announcement that budget decisions would be made in line with the National Development Plan.

"This puts South Africa in a better position to take coherent and co-ordinated short-term and long-term decisions to deal with the stresses and strains in the current economic outlook," Majokweni said.

She called for more public spending on infrastructure, while expressing concerns about the public wage bill.

Majokweni argued that public spending should go towards strengthening South Africa's finances.

The organisation welcomed the announcement that tax compliance would be used as a criterion when awarding government tenders to businesses.

"This can form an important part in building and strengthening a non-corruption environment," Majokweni said.

Trade union Solidarity called Gordhan's medium-term budget policy statement a "redistribution budget" that was unsustainable.

Solidarity economist Piet le Roux accused the finance minister of devoting two-thirds of his budget to redistribution of wealth.

"It is clear that the government is prepared to be very effective in extracting more tax from hard-working South Africans," Le Roux said in a statement.

Gordhan said the government would raise more revenue through getting people and companies to pay more of the tax they owed.

"What Gordhan described as better tax compliance is, however, nothing more than heavier tax on hard-working South Africans."

Le Roux argued that taxes took funds from people who created wealth, and that the government regularly misspent it.

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