Battle for soul of Treasury
Finance minister Tito Mboweni is seeking to bring an end to the battle for the soul of the National Treasury, which had played out under former president Jacob Zuma’s administration and was fast becoming a risk to the country’s international credit rating, leaving the Reserve Bank as SA’s last bastion of institutional strength.
Shortly before delivering his maiden medium-term budget policy statement last week, Mboweni said he was refamil-iarising himself with thought processes in the cabinet.
But he added: “I thought one of the things I am going to do is try and provide political protection to the National Treasury and, to the extent naively possible, to de-politicise the National Treasury. I am going to try and provide political protection for the National Treasury.”
Under Zuma, the Treasury was forced to provide for the shortfall in university fees after Zuma announced a fee increase would be suspended in 2016.
In 2017,he put the Treasury on the spot by announcing free higher education for students from poor households.
The Treasury had to allocate an additional R57bn over the next three years, then finance minister Malusi Gigaba said at the February budget in 2018.
Mboweni said that during the few days before the budget on Wednesday, he and other Treasury officials had met leaders of political parties in parliament “to try and give them an understanding of the direction in which we are going”.
Mboweni said he intended to send a letter to deputy finance minister Mondli Gungubele to instruct him to “spend time” with political party leaders.
Mboweni is the country’s seventh finance minister in five years.
A reluctance to continually bail out struggling state-owned companies was one of the messages Mboweni emphasised last week, stating there were “no holy cows” when he was asked about the potential sale of SAA.
Mboweni also suggested that the public sector wage bill, which constituted 35% of the government’s consolidated spending, should aim for a “sweet spot” below 30%.
He would also suggest to President Cyril Ramaphosa to reduce the cabinet size to 20 ministers from about 70.