A test of priorities

TAFTER THOUGHTS GUESTWRITER

Minister of Finance, Neal Rijkenberg, will have everyone’s attention on Monday as he presents his sixth national budget. What really counts for us laymen is how the budget impacts our wallets. Are we going to have more or less to spend?

The budget comes shortly after that of his South African (SA) counterpart, who avoided any increases in income tax, VAT or fuel levies, with about 60 per cent of the budget going towards social grants as well as salaries for teachers, doctors and nurses. However, this will come at the cost of reducing national reserves by about E150 billion.

Will our budget lean towards the SA approach, or will it adopt a more radical one similar to that of Argentina President Javier Milei, who has reportedly achieved the country’s first monthly budget surplus in 12 years? He achieved this after one month in office. He has reduced what he described as a bloated civil service with too many ministries and is also said to have introduced an economy class flying policy. Interesting.

Expectations

Our approach will only be known Monday. There are numerous expectations weighing on Rijkenberg’s shoulders, with Sibaya setting the agenda on where the money should go. The outcome should be more employment opportunities, less poverty, better healthcare services, food self-sufficiency, enhanced quality of education, upgraded road infrastructure and clean water and electricity for the population.

There is a general expectation that government can do more this financial year following improved tax collections locally and externally through the Southern African Customs Union (SACU). We have also been informed by His Majesty that the country’s fiscal deficit has dropped from about 4.5 per cent in 2021/22 to 1.6 per cent of GDP in 2023/24 and the economy looks set for an above 4 per cent growth.

On Monday we will get to know whether the budget deficit will maintain this level or increase beyond the benchmark of 5 per cent of GDP and fall short of the guiding SADC macroeconomic convergence targets. Whatever the minister decides, he should see to it that we don’t find ourselves accumulating arrears that result in serious cash flow challenges.

Challenge

Doing away with wasteful expenditure and merging government parastatals would be a good place to start; easier said than done of course. Ensuring a consistent availability of essential health services and medication is the biggest challenge for government and it remains to be seen if the budget speaks to addressing it. Our schools are also in dire need of proper funding for proper learning to take place.

And despite Eswatini being an agriculture-based economy, there is a challenge with limited youth involvement in this crucial sector, with over half of them unemployed. It is crucial to attract young people to agribusiness, particularly in rural areas, as a means to escape poverty. Is there a plan in place to address this issue?

Our Members of Parliament will undoubtedly be interested in reviewing the figures concerning the Regional Development Fund (RDF). In the past financial year, approximately 93 projects, focusing on income generation and infrastructure, were successfully finished, totalling nearly E74 million. Reportedly, this investment has resulted in the creation of approximately 2 500 jobs. Is this sufficient or should we assess the operations of this fund to maximise the use of the resources allocated to it?

Another big task for government is the upgrading of the country’s road network. His Majesty emphasised the need to ensure feeder roads are accessible. This leaves the Ministry of Public Works and Transport with the huge assignment of providing all-weather accessibility to road users. While doing so, it can’t afford to forget the condition of existing roads, some of which need to be saved from total collapse as most have surpassed their design life.

Supervise

As Minister of Finance, Neal also has the responsibility to supervise and regulate the financial sector. This is more important now than ever before following the loss of over E340 million invested by emaSwati in Ecsponet with the hope of a life-enhancing return. Many pensioners are either dead or suffering physically and emotionally from this predicament. What will be done to avert a repeat of this tragedy, or at least compel the institutions we entrust with our investments to have some form of security that would be used to compensate consumers in the event of such losses in the future?

When all is said and done, with everybody getting down to business with government, procurement is the deal-breaker. This is where corruption thrives. We have seen the minister introduce price capping for suppliers to the government through the Market Price Reference Catalogue to prevent suppliers from selling common-use items at inflated prices to government ministries, parastatals, State-owned enterprises and municipalities. Is this enough? Is the government procurement system structured well enough to connect to a central location that can track and monitor the transactions taking place across these institutions to ensure the catalogue is being fully adhered to?

It must; otherwise all the good intentions of Monday’s budget will come to nothing but wasted effort and more hardships for us all.