‘Invest in human capital’
AS FINANCE Minister Malusi Gigaba delivers his first Medium Term Budget Policy Statement today, civil society organisations have called for the budget to prioritise investment in human capital through education, health, and social services and put the fight against poverty, inequalities and underdevelopment first.
In their alternative budget, the Studies in Poverty and Inequality Institute said despite nominal increases in health budgets, current provincial allocations for health care remained insufficient.
“A number of provincial departments have reported unfunded commitments in excess of R13 billion,” the institute said.
“South Africa’s housing crisis will only be addressed with adequate resources. Instead, we have noted worrying decreases in real term allocations to the national housing budget. Although expenditure trends are generally positive, spending by metros on the Urban Settlements Development Grant faces serious challenges. We hope this will not result in the reduction of funds.”
With 17 million people getting social grants, they also called on the National Treasury to increase child grant payments, and consider social grants for working-age people as the current grants were below the food poverty line.
The Alternative Information and Development Centre (AIDC) said: “Until now Gigaba has said different things on the possibility of nuclear. Shortly after he was appointed he indicated that it was too soon to tell if the nuclear build is affordable for South Africa or not. However, it was reported that at meetings with the IMF and World Bank recently, Gigaba indicated that nuclear is unaffordable.
“What Gigaba will do regarding nuclear is difficult to predict but we argue that in order to deal with the threat of climate change, and to create jobs, the finance minister must signal a move to develop a publicly owned renewable energy programme on a massive scale.”
The AIDC said their new research indicated that if the government developed a publicly owned renewable energy industry in South Africa it could provide 35 times as many jobs as the “Renewable Energy Independent Power Producer Procurement Programme”.
The AIDC said that with South Africa’s unemployment rate being among the highest in the world and being the 12th biggest carbon emitter, Gigaba would also have to explain how he will create growth and jobs, while simultaneously mitigating the impacts of climate change.
They added that tax loopholes should be closed.
“Illicit Financial Flows are a direct blow to South Africa’s economy and should be addressed as such. The government has to both implement new legal standards to tackle these flows and to reinforce Sars enforcement bodies to increase the pressure on non-compliant taxpayers and companies. To reduce inequalities the government should increase two different taxes, personal income tax and a wealth tax,” said the AIDC.