The 2021/2022 budget tabled by finance minister Tito Mboweni last week might be inconsistent with the constitution’s bill of rights in that it projects a decrease in the provision of basic rights, Michael Sachs, the acting chair of the statutory body mandated to advise the government on its fiscal framework and inter-governmental relations, said in parliament on Wednesday.
He said the budget signaled the erosion of basic human rights such as basic education, health-care and social grants enshrined in the constitution. Sachs said the Financial and Fiscal Commission (FFC) is not convinced that the budget is consistent with the provisions of the constitution and that Mboweni has not gone far enough to convince it of this.
There is no obligation on the Treasury to follow the advice of the commission, though the finance minister has to formally respond to the submissions it makes. The FFC has complained in the past that its recommendations have largely been ignored.
Concluding a presentation by FFC researchers on the budget to parliament’s finance and appropriations committees, Sachs — who was previously head of Treasury’s budget office — noted that the constitution’s bill of rights is binding on the legislature and the executive.
“What we see here is that, for the first time, a budget has been tabled in parliament that unambiguously envisages a retrogression in socio-economic rights set out in the bill of rights,” Sachs said. This retrogression is likely to extend beyond the three years of the medium-term expenditure framework until debt has stabilised. He noted that per capita, non-interest government spending would fall by about 15% over the next three years.
For instance, the budget for central hospitals in 2019 was about R44.7bn while its budget for 2021 is estimated at R44bn, which means that less money in nominal terms will be spent on central hospitals in 2021/2022 than in 2019. But the constitution says the state has to ensure there is a rising floor of access to health services.
There was no discussion in the Budget Review of its constitutional implications, nor any discussion about whether these social services can be maintained in their current state
The constitution also says that no-one may be refused emergency medical treatment, yet the budget for this in 2021 is R7.2bn compared to the 2019 budget of R8.2bn.
Over the next three years these budgets will fall far below inflation “so we expect to see a real erosion in the value of services provided through central hospitals over [this period]”, Sachs said.
With regards to the right to basic education, the budget for this is to grow at less than 2% over the next three years. A lot of this relates to compensation. Sachs said the Budget Review itself acknowledged that there will be retrogression in the provision of basic education because there will be fewer teachers and a rising number of pupils, which means larger class sizes, especially in no-fee schools, “which is expected to negatively affect learning outcomes”.
The budget for student and teacher support materials will also be eroded over the next three years.
There have been cuts to social grants despite the constitution being explicit on the rights of children, saying every child has a right to basic nutrition. Social grants, including the child support grant, are expected to fall in real terms over the next three years in the context of rising child hunger.
“Clearly, there are economic realities the country faces. We have had declining per capita income as a society for the past five years or more and if the National Treasury projections are anything to go by, we will continue to have declining per capita income over the medium term. The question has to be raised whether the promise of the rights of the constitution can be realised if we continue to have declining per capita income. Debt service costs are rising and this is crowding out the fiscal space for the provision of these social services.”
The Treasury is also trying to address the rise in the public-sector wage bill over the past few years.
There was no discussion in the Budget Review of its constitutional implications, nor any discussion about whether social services can be maintained in their current state with the resources budgeted for them were reduced, despite the rights outlined in the bill of rights defended.
“Parliament needs to ask these questions in its efforts to hold the executive accountable,” Sachs said. “The minister of finance needs to be asked how he applied his mind to these constitutional imperatives when he was weighing the protection of these rights.
The government has a duty to explain its decision, he said, to reduce expenditure that might have been necessitated either by a decline in economic conditions or by the choices it has made, for example, to lower taxes or support state-owned enterprises that were performing poorly.
“I am not saying this is a wrong measure. I am simply stating that if we are going down this path the onus is on the executive to explain to parliament and South Africans the situation we face and what measures it is taking to defend their rights in terms of the constitution.”
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