Zuma and Gi­gaba are de­stroy­ing the lives of fu­ture gen­er­a­tions

Pres­i­dent has mis­man­aged fi­nances so badly SA is at mercy of ‘mashon­isas’

Sowetan - - Opinion - Prince Mashele

When a shal­low and fash­ion­able man makes a pre­sen­ta­tion in par­lia­ment, some peo­ple be­lieve him, and get car­ried away by the pseudo-po­etry with which he pep­pers his ha­rangue.

That is what hap­pened on Wed­nes­day when Malusi Gi­gaba pre­sented his first mid-term bud­get pol­icy state­ment. His suit was as colour­ful as his lan­guage was daz­zling.

It was all a clever trick to con­ceal a sim­ple truth: that the Zuma gov­ern­ment is broke, and that it will bor­row more money at the ex­pense of fu­ture gen­er­a­tions.

Econ­o­mists have in­vented jar­gon to con­fuse or­di­nary peo­ple. Phrases like “bud­get short­fall”, “deficit” and “debtto-GDP ra­tio” were used by Gi­gaba to hide the sim­ple fact that the gov­ern­ment has run out of money.

When he says that in 2017 there will be a bud­get short­fall of R50.8-bil­lion, it sim­ply means that the time might come when there will only be Panado in your near­est clinic, and noth­ing else.

If you are a worker, a bud­get short­fall sim­ply means less money in your bank ac­count at the end of the month when you are paid.

In such a sit­u­a­tion, you must de­cide what not to pay. Do you skip pay­ing for your bond, your car, or do you buy less food? This is what a bud­get short­fall means in prac­ti­cal terms. It means that our gov­ern­ment is broke.

When Gi­gaba says he will sell gov­ern­ment shares in Telkom to re­cap­i­talise SAA, he is es­sen­tially say­ing his gov­ern­ment is so broke that the only thing it can do is to sell its as­sets to sur­vive. It is like sell­ing your spoons or bed to buy food for your fam­ily.

We must re­mem­ber that the Telkom shares are not the first to be sold by the Zuma gov­ern­ment. Pre­vi­ously when it was broke, it sold shares in Vo­da­com.

From now on, the gov­ern­ment will have no fur­ther shares to sell. It is like sell­ing all your clothes to pay debt un­til you are necked.

Gi­gaba also told us that by 2022, gov­ern­ment’s debt-toGDP ra­tio will be more than 60%. This means that Zuma’s gov­ern­ment has wasted so much money that the next gov­ern­ment and fu­ture gen­er­a­tions will have to pay for his fi­nan­cial reck­less­ness.

When the ANC took over gov­ern­ment in 1994, the apartheid gov­ern­ment had sunk SA into un­sus­tain­able debt as a way of ty­ing the feet of the new gov­ern­ment.

Given his knowl­edge of eco­nomics, Thabo Mbeki came up with a plan – Gear – to dig South Africa out of the apartheid debt hole.

The cen­tral mes­sage that came from Gi­gaba’s speech is that Zuma has taken us back into the same apartheid hole. Our coun­try will no longer sur­vive with­out run­ning, beg­ging bowl in hand, to money­len­ders for help.

What all this means is that to pay salaries of teach­ers, nurses and other pub­lic ser­vants, our gov­ern­ment will need to bor­row money. If you work for gov­ern­ment, you will re­ceive a bor­rowed salary.

The peo­ple who lend money to gov­ern­ment op­er­ate like mashon­isas. When they think the gov­ern­ment might not re­pay, they sim­ply raise in­ter­est. When a mashon­isa sus­pects you might not pay him back, what does he do? He takes your bank card and ID from you – not so?

That is ex­actly what Zuma has done to our gov­ern­ment. He has mis­man­aged our coun­try’s fi­nances to the ex­tent that we are now at the mercy of money­len­ders.

There are se­ri­ous im­pli­ca­tions for mil­lions of South Africans. The stu­dents who are study­ing, and hop­ing to find em­ploy­ment in gov­ern­ment, must for­get it. There will be no jobs for them. The gov­ern­ment is broke.

The mil­lions of South Africans who are work­ing for the state must also ex­pect no salary in­creases in the next few years. Where will the money come from?

We must also ex­pect the qual­ity of ser­vices de­liv­ered by the state to de­cline. There might be short­ages of fuel for am­bu­lances to trans­port the sick. There might be short­ages of text­books for chil­dren in town­ship and ru­ral schools. In fact, we are get­ting closer to the day when the gov­ern­ment might be forced to re­trench its work­ers.

To add in­sult to in­jury, Zuma is push­ing hard to con­clude a nu­clear deal with the Rus­sians be­fore De­cem­ber. That would lit­er­ally col­lapse the fi­nances of our gov­ern­ment, and Zuma would pos­si­bly em­i­grate to Dubai – to en­joy with the Gup­tas.

South Africans be­ware: Gi­gaba and Zuma are busy de­stroy­ing the fu­ture of your chil­dren. Don’t be fooled by the colour­ful­ness of their suits.


Fi­nance Min­is­ter Malusi Gi­gaba during his medium-term bud­get pol­icy state­ment used fancy jar­gon to con­ceal a sim­ple truth that the gov­ern­ment is broke, says the writer.

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