Cosatu: Cutting budgets will only cripple economy further
The Congress of South African Trade Unions says cutting the budget will only hurt economic growth.
Finance Minister Enoch Godongwana is set to table the Medium-Term Budget Policy Statement in Parliament on Wednesday.
It will be the first budget under the government of national unity, and several ministries have already been warned that funding will be cut.
Cosatu’s national spokesperson, Matthew Parks, says with economic growth stuck below 2%, rising unemployment, and intense levels of poverty and corruption, National Treasury cannot afford to cut budgets.
Parks believes that providing departments with less money will only cripple the economy further.
“Cutting budgets does not address the root cause of a stagnant economy. It worsens it and starves the economy, it further cripples public services.”
Parks says he hopes the government will abandon what Cosatu believes to be the myth that the country has a bloated public sector.
“We have seen a ratio of teachers, police officers and nurses to society rising at an alarming rate. Home Affairs says it is overwhelmed, yet it has a 60% vacancy rate. The myth that the public service ratio is out of control is not true because it (Home Affairs) has been a stable 35% budget for the past 15 years,” Parks pointed out.
Cosatu has also urged the government to prioritise additional support to state-owned entities such as Transnet, Eskom and Prasa.
“We agree that the public debt must be managed, but the sanest way to do that is to create jobs, grow the economy and ensure that the state can provide the public services that the economy needs,” Parks said.
“Creating jobs and a growing economy reduces generates tax revenue and reduces debt.”
Parker said the so-called mini-budget also needs to set aside money to rebuild local government to ensure staff are paid, basic services are delivered, and infrastructure is maintained.
“They need to invest in public services, filling important vacancies and making sure they hire competent staff, particularly schools, Home Affairs, and hospitals. And make sure that the NPA and police win the war against corruption.”
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