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For detailed coverage of today’s medium-term budget announcements, go to Fin24’s Mini Budget site.
Finance Minister Tito Mboweni is presenting South Africa's medium-term budget policy statement on Wednesday afternoon in parliament.
In what has been billed South Africa's most important medium-term budget to date, Mboweni sets out government's spending plans for the next three years.
30 Oct 2019
Investec economist Annabel Bishop says the mid-term budget's "extreme ramp-up" in debt-to-GDP projections makes a Moody’s credit rating downgrade substantially more likely.
The current budget deficit is now at 5.9% of GDP, compared with 4.5% last year. It is now expected to rise to 6.5% next year.
The national debt now tops R3trn and may grow to R4.5trn by 2022/23 – or 71.3% of GDP. It is currently at 61% of GDP.
Moody's is the only one of the credit rating agencies that still reckons South African government bonds are investment grade. If it also downgraded South Africa to junk, South Africa will pay much more on government bonds.
"It will be a close call whether the outlook drops from stable to negative on SA’s dual currency long-term sovereign debt Moody’s rating, or if an actual rating downgrade occurs."
30 Oct 2019
Deputy EFF leader Floyd Shivambu says there is nothing new in Finance Minister Tito Mboweni's mid-term budget.
Speaking to journalists on the steps of Parliament after Mboweni delivered his address, Shivambu said the finance minister "ignored" that the structure of the South African economy had to fundamentally change
Shivambu said Mboweni should rather have talked about reindustrialisation and strategic import substitution, adding the mid-term budget was characterised by "neo-liberal drivel".
30 Oct 2019
Treasury has warned that while South Africans have been hit with large tax hikes over recent years, even more taxes are being considered to boost state coffers.
“Significant tax increases over the past several years leave only moderate scope to boost tax revenue at this time. Given the size of the required adjustment, however, additional tax measures are under consideration,” Treasury said in its mid-term budget policy statement on Wednesday.
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30 Oct 2019
The finance minister has given South Africans an "optimistic road forward" under "difficult circumstance," according to Pravin Gordhan.
The minister of public enterprises was commenting on his Cabinet colleague's medium-term budget policy statement at Parliament.
"I think what we need now is hope and confidence, investment and the creation of jobs," said Gordhan, who has twice served as minister of finance. "And if all of us work together – unions, government, business and the communities, we can make it happen".
On Tuesday Gordhan published ths state's long-awaited Eskom policy roadmap for Eskom, which includes completing the unbundling of its generation, transmission and distribution operations by December 2022.
30 Oct 2019
When Finance Minister Tito Mboweni presented his maiden budget in February, he brought a hardy aloe plant to Parliament and placed it on his lectern. The plant indicated that SA needed to ready itself for hard years ahead.
On Wednesday, when he presented his second medium-term budget in Cape Town, he gave an update: the aloe was not doing well. "It needs attention, like our public finances," he said, according to his prepared remarks.
"Our problem is that we spend more than we earn. It is as simple as that."
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30 Oct 2019
Minister of Finance Tito Mboweni announced on Wednesday that cabinet members and other politicians may face salary cuts.
While Mboweni had announced proposals including early retirement, reorganisation, salary freezes and the reduction of bonuses to keep public service spending in check in his February budget, he said on Wednesday that these had "not realised as much savings as we hoped".
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30 Oct 2019
Government will help struggling national carrier South African Airways (SAA) repay its R9.2bn in government-guaranteed debt over the next three years, Minister of Finance Tito Mboweni announced on Wednesday when he tabled his second mini budget.
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30 Oct 2019
Despite speculation that Finance Minister Tito Mboweni would make an announcement on reducing Eskom's R450bn debt burden, the minister said on Wednesday that the power utility's management has yet to show progress on reforms.
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30 Oct 2019
Minister of Finance Tito Mboweni gave a sobering forecast of a shortfall in tax revenue collections, saying that Treasury expected to collect R1.37trn this year, about R52.5bn less than its projection in the February Budget.
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30 Oct 2019
Mboweni concludes his speech by wishing the Springboks well in the Rugby World Cup.
"May I wish the Springboks all the best this weekend."
30 Oct 2019
30 Oct 2019
Mboweni: "Government has made progress on a blended finance Infrastructure Fund. The Fund will be hosted by the Development Bank of Southern Africa. A pipeline of possible projects amounting to more than R500 billion has been identified."
30 Oct 2019
Through reprioritisation, the NPA will get an additional R1.3bn and SARS and additional R1bn for the next two years.
"These funding shifts will bolster efforts to combat corruption and improve revenue collection," says Mboweni.
30 Oct 2019
30 Oct 2019
30 Oct 2019
In sending "a message" to state-owned companies, public entities and the private sector, Mboweni announced that salaries will be frozen for Cabinet members, premiers and MECs.
The is a likelihood of downward adjustments too, Mboweni adds.
Costs of officials cars will be capped at R700 000 and cellphone dispensation will also be capped.
All domestic travel will be on economy class.
30 Oct 2019
"On our current trajectory, by the end of the three-year framework, debt service costs will be bigger than spending on health and economic development," says Mboweni.
30 Oct 2019
"Stabilisation involves difficult decisions that imply sacrifices by all of us. Slowing growth in the compensation bill and additional revenue measures will be needed.
"The consequences of not acting now would be gravely negative for South Africa. Over time, the country would likely face mounting debt service costs and higher interest rates and may enter a debt trap," says Mboweni
30 Oct 2019
"This year, the national debt exceeded R3 trillion. It is expected to rise to R4.5 in the next three years. Clearly, we need to do things differently.
"We spend more than we earn," Mboweni says.
30 Oct 2019
"Cabinet has approved that we implement the findings of the Nugent Commission of Inquiry, and I intend to table a bill early next year.
"We now expect to collect R1.37 trillion this year. This is R53 billion, or 4%, less than we expected. Looking ahead, our revenue forecasts are prudent," Mboweni says.
