The 2012 edition is instructive when then Finance Minister Pravin Gordhan, with a straight face, urged the public sector to “pursue value for money with the greatest possible vigour and ensure taxpayers’ money is well used.”
Unlikely we’ll hear that repeated by Nhlanhla Nene after that R250m “invested” on security upgrades at President Jacob Zuma’s Nkandla homestead.
As serious, though, is how wrong the Treasury called economic growth
Basing forecasts on an improving global economy (which happened) and the adoption of the National Development Plan (which didn’t) Gordhan confidently predicted SA’s economy would recover “to 3.6% and 4.2% growth in 2013 and 2014.” Expansive social and other spending plans were based on those predictions. Numbers which turned out to be a massively optimistic as the economy stuttered to 1.9% in 2013 and at 1.4% last year.
Missing the targets by such a wide margin translates into an immediate shortfall of R12.5bn
If it were a company, SA Inc would be forced to slash spending to stay afloat. But Governments have the easier option of raising taxes. So brace yourself for a probable 20c a litre tax on fuel; and a couple of percentage points extra on CGT, dividends and the top marginal income tax rate.
The big question, though, is whether policymakers have learnt anything from the predictable inability of this economy to respond to business-unfriendly policies.
More hot air and empty promises? Or sensible economics?