What's the difference between the new-ish Kaizer Chiefs coach and our finance minister, Enoch Godongwana?
Nasreddine Nabi has brought respectability back to the Soweto glamour boys' game as they seek to recover from a decade-long trophy drought.
Godongwana does not have a policy environment that can crank up economic growth quickly.
This week, the National Treasury revised its growth forecast for this year to 1.1% from the 1.3% announced in February.
The economy is expected to grow at an average of 1.8% over the next three years. This is more realistic than the hyperbole-tipping 3.2% growth.
A realistic projection instead of evangelical promises is important for the Treasury and the budget's credibility. In recent years it became the norm for the Treasury to be revised down, and that chipped away at credibility.
Godongwana’s MTBPS was about stability, which was boring to market participants who were hoping for dramatic indications they could trade on for short-term profits.
It is possible that the Treasury is tired of overpromising economic growth, as more output is not merely a function of fiscal policy.
Transnet's growth must improve drastically in the short term and the Treasury does not have the power to force this improvement.
Godongwana uses a “tough love” approach to SOEs, where he funds them on the basis of meeting certain conditions. This week, he gave no signs that Transnet will get money soon.
We need to watch him critically to see whether he gives guarantees between his budget statements, from the contingency reserve or through an adjustment appropriation. Transnet is suffering due to debt repayments and may scream even louder for an off-season injection.
Eskom is also in the dog box for its failure to dispose of the Eskom Finance Company, established in 1990 to provide home loans to staff.
The Post Office, too, was snubbed this week when Godongwana did not allocate the R3.8bn required to restructure it through business rescue. Instead he advised the telecommunications department, under which the Post Office falls, to look for money in its own budget. Failing which, the Post Office faces liquidation.
Godongwana also disappointed some market participants who expected a hint over whether he will embrace a lowering of the inflation targeting band. And he did not accede to pressure to adopt a strongly articulated fiscal anchor like introducing a formal debt ceiling.
He argued at the RMB-Sunday Times Think Budget on Thursday that public debt was a ratio factoring the rate of growth. South Africa’s growing debt service costs did bite, especially because of anaemic growth.
As a Kaizer Chiefs supporter, Godongwana was probably disappointed to face the reality that the road ahead is long in sport, as it is in South Africa’s political economy
Nabi, the Kaizer Chiefs boss said this week the club's problems would not be solved immediately.
“The mission that we are fulfilling has many steps, and there are some media that are trying to portray Kaizer Chiefs as a contender for a trophy or for a league immediately, which is not the case, but we have to play and get the results,” Nabi said.
As a Kaizer Chiefs supporter, Godongwana was probably disappointed to face the reality that the road ahead is long in sport, as it is in South Africa’s political economy.
The Treasury seems to suggest that the impact of structural reform will boost its subdued projects and, therefore, serve as a positive surprise.
Godongwana’s success depends on the performance of a couple of his colleagues. Competition and industrial policy are under-watched in the debate about growth as levers to crank up the South African economy. We spend too much time pontificating about fiscal policy, whose role in the equation is essential but not without limits.
A comprehensive review of our competition policy would be a good place to spend time, too, as part of a journey towards improving productivity. The budget cannot change our fortunes all on its own, or overnight.
The government of national unity is enjoying a honeymoon, and it needs to enjoy it to the fullest before the political season turns nasty. Things will be hot from the second half of next year as the DA faces a leadership conference and the ANC does its mid-term review. The campaigns for the 2026 local elections will follow that.
When we look back, we will ask if there’s more the Treasury could have done during this honeymoon, this haymaking period. Only when we are in our winter will we be able to answer that question legitimately.
• Mkokeli Advisory is the lead partner at public policy consultancy Mkokeli Advisory.
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