Finance Minister Briefs Joint Standing and Select Committees on Finance on MTBPS

Date:

The Standing and Select Committees on Appropriations and Finance together with the provincial portfolio committees on Finance on Thursday unanimously welcomed the extension of the Social Relief of Distress Grant (SRD) during a joint meeting with the Minister of Finance. The Finance Minister, Mr Enoch Godongwana had appeared in the National Assembly the previous day to present the Medium-Term Budget Policy Statement (MTBPS).

The National Treasury’s Director-General, Dr Duncan Pieterse, told the meeting that over the next three years the government will focus on raising gross domestic product (GDP) growth by improving electricity supply, logistics and infrastructure delivery, among other things. The Minister cautioned committees that the outlook for public finances was vulnerable to various domestic and external risks but the government is employing fiscal strategies to mitigate such risks.

The committee pressed the Finance Minister on the government’s bailout of Eskom and the government’s stance of “tough love”, which had been a feature of last year’s Budget speech. The MPs asked to hear details about the conditions set by the government as part of Eskom’s debt relief programme. Dr Pieterse replied that nothing has changed. The conditions set out in the Eskom Debt Relief Bill remain in place and are enforceable. Furthermore, the Treasury is in a position to submit the conditions of the bailout to Parliament if members required it.

Other questions for the Treasury concerned the likelihood of tax increases in 2024 to fund shortfalls arising from slow economic growth and government debt levels. Mr Godongwana pointed out that the government is committed to responsible borrowing and has a balanced approach that includes spending restraint, revenue measures and additional borrowing.

Mr Sfiso Buthelezi, who chairs the Standing Committee on Appropriations, commended the Minister and pointed out that some of the interventions are temporary. The real problem lies in creating more jobs and stimulating the economy. Mr Buthelezi joined fellow committee members in welcoming the extension of the SRD grant, however, committee members asked for more information on how it will be funded for another year, given that it has cost about R44 billion already.

The Chairperson of the Select Committee on Appropriations, Ms Dikeledi Mahlangu, welcomed the extension of the SRD grant, saying that her committee has long called for the SRD grant to be converted into a basic income support grant.

Meanwhile, the Chairperson of the Standing Committee on Finance, Mr Joseph Maswanganyi, wanted to know more from the Minister of Finance about his comments on restructuring the state. He reminded the meeting that restructuring in the previous governmental administration resulted in the closure of several universities. Mr Maswanganyi also wanted clarity about government programmes, given the recent announcement from government about the Economic Reconstruction and Recovery Programme.

Jabulani Majozi

3 November 2023

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