Finance minister Enoch Godongwana finally presented a 2025 budget, his third, to parliament on Wednesday that he might safely assume is safe.
He dropped his mad hunt for a VAT increase to keep the state paying salaries and raised the fuel levy, is counting on an extra allocation to the revenue service to help it collect at least another R35bn and holding back on the spending increases that the VAT increases would have paid for.
All in, the final budget was as anodyne as every other ANC budget for at least the past 20 years. Lots of inclusive growth, green shoots, more infrastructure, more jobs. The speeches are always thin. Thus Godongwana can say of the budget facility for infrastructure (BFI), for instance, that it has been reviewed “for feasibility, viability and effectiveness” and that “to date, R52.9bn in additional funding has been unlocked” through that process.
The BFI consist of about R900bn and he seemed to be saying that, after consideration, R53bn had been found to have been unfeasible. Really? Relax. The money was never in the bank. It’s a target and the National Treasury has been quite careful about converting it into money and spending it.
To date the Treasury has been miserly with it but the pressure is on and Godongwana from now on said he would look at proposals every three months rather than once a year. Huge concession and a pretty revealing measure, seven years into Cyril Ramaphosa’s presidency, of how sluggish his time in office has been.
Surely we don’t have to thank the DA, which made such a nuisance of itself over VAT, for the change. Godongwana was gracious in his recognition that the making of budgets have changed. “Negotiation, debate and compromise… has been a necessary, if sometimes painful, investment in the productivity of future government reform in the new political environment,” he said.
Sadly for the DA though, the more it gets out of being a member of the government of national unity the more it will have to take responsibility for the almost certain failures to come.
And there, suddenly, in the budget speech, is a jobseekers’ allowance attached as a condition to the social relief of distress (SRD) grant, all those quiet spending reviews suddenly cough up R37.5bn in cuts, a decrease in defence spending as the operation in the DRC comes to a sticky end, more money for Sars and, obviously, no VAT increase.
All those have been DA demands and it certainly can’t complain about the fairly rich harvest it collected on Wednesday.
Sadly for the DA though, the more it gets out of being a member of the government of national unity the more it will have to take responsibility for the almost certain failures to come.
President Cyril Ramaphosa’s reform programme is great on paper but it’s the implementation, as always, that could undo it and the ANC’s record in this regard is, to put it mildly, disgraceful.
That’ll keep the DA constantly on the edge as, first, a party leadership election must be held in, at most, a year’s time and then local government elections at the end of 2026 or early 2027 taunt it from the horizon. Is the DA really going to wait until just before what will be a referendum on Ramaphosa’s final term in office before electing a new leader or re-electing the current one?
It seems incredibly risky. If the leadership is going to change, surely you give a new team time to show what it is made of? There’s no reason DA leader and agriculture minister John Steenhuisen can’t remain in government if he’s no longer party leader. If the idea is to wait until the last moment that will be a federal executive decision and we can assume it has no intention of changing anything.
• Bruce is a former editor of Business Day and the Financial Mail.
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