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Mini budget — Godongwana could have done better, say civil society organisations

Mini budget — Godongwana could have done better, say civil society organisations
Finance Minister Enoch Godongwana delivers his Medium-Term Budget Policy Statement on Wednesday, 26 October 2022 at the Cape Town City Hall. (Photo: Leila Dougan)

Civil society organisations with a focus on education, health and food justice discussed what they welcomed and what more could be done after Finance Minister Enoch Godongwana delivered the 2022 Medium-Term Budget Policy Statement on Wednesday.

The additional spending on education and the school nutrition programme, and the extension of the Social Relief of Distress grant announced in Wednesday’s Medium-Term Budget Policy Statement (MTBPS) have been welcomed by human rights organisations — but they say ignoring inflation may result in that social spending making little to no change for citizens in need.

Non-profit organisation Santa Shoebox (SSB) Legacy welcomed the R66.9-billion earmarked for health and education and the provision of free basic services by local government tabled in the MTBPS.

Samantha Massey, project manager at SSB Legacy, said the funding that had been extended for another three years to provide nutritious meals for nine million learners during every schoolday was essential. 

“However, more must be done to ensure that this programme is extended far into the future and that feeding our country’s children remains a top priority, as every human has a right to food,” said Massey. 

SRD grants and food

Isobel Frye, the executive director of the Social Policy Initiative, said Godongwana appeared reluctant when he announced the intention to extend the R350 Social Relief of Distress (SRD) grant for another fiscal year from March 2023.

“There is no announcement of an increase to the amount of the grant in line with inflation, despite the high food inflation. Furthermore, the minister said that to pay for the continued R350 grant, other grant beneficiaries, namely children and older people, would receive lower-than-inflation increases next year; so, robbing the poor to pay the poor. The tax over-collection, instead of being used to pay for this, is going towards reducing the budget deficit, which, given the economic decline, is not a priority.

“[There is] high food inflation of 8.5%, which clearly indicates the need to assist the poor to meet their basic food needs. In addition, he announced a higher-than-anticipated tax yield of R83.5 billion. 

“The positive contribution of the R350 grant to building back household consumption demand was noted, and yet we note that only 7.4 million of the previous just under 12 million people are in receipt of the R350 grant. In fact, DSD [Department of Social Development] has underspent by R2-billion, particularly on the fact that people were rejected in their SRD R350 grant applications.”

Frye said there was a lack of political will to revitalise impoverished and rural economies and suggested that there needed to be “a serious political commitment to universalising an income grant that is at least in line with the Food Poverty Line of R663, increasing over time to the Upper Bound Poverty Line of R1,417 in the next three years”.

Education

Equal Education researcher Jane Borman said the tone of the MTBPS didn’t show urgency concerning the crises in the country, especially in education.

She said it was not enough to say problems such as infrastructure were “slowly being fixed” when more than 2,000 schools still lack basic sanitation, use pit latrines and have limited or no access to clean water. 

“It seems like things are going better than expected; there is more money for education infrastructure, they are giving more money for post-flood relief in KZN and more for the Eastern Cape. But the inflation rate is so high; when you factor it in, then the education budget is decreasing this year. Of course, the government doesn’t control [inflation], but there needs to be a massive intervention.

“I asked how we will ensure there is infrastructure, sanitation, classes, and the answer you normally get is, ‘Well, we don’t have enough money’, and when you question National Treasury, they say, ‘Well, the money doesn’t get spent appropriately so even if we gave the education department more money [it wouldn’t help]’,” said Borman.

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Borman said sky-rocketing inflation almost cancelled out the additional social spending across the board. 

“National Treasury has the final word on national spending, they’re the final overseer of spending so it would be great if they didn’t act as though their hands are tied. 

“We would like to see money going towards the overcrowding crisis, keeping up with learner enrolment, post-Covid. It can’t all be done immediately but [the] MTBPS didn’t meet the moment,” said Borman.

Daniel McLaren, a budget analyst at SECTION27, said SECTION27  welcomed the “slight” top-ups for the departments of health and education for next year.

“Health and education are both personnel-heavy sectors and as Treasury tried to weather the global storm, they cut budgets and there was less money to hire personnel as wage bill cuts were a huge focus, so we welcome the alleviation from those budget cuts for this year.

 “We welcome the continued commitment to the school nutrition programme being extended to more schools and to the spending on infrastructure.

“The big caveat is [that] implementation is still poor; we see projects take years to be completed, we continue to see money coming back unspent, or projects being over budget.”DM/MC

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