Budget Speech 2020: Mboweni makes fiscal consolidation his main aim in budget

PARLIAMENT –  Finance Minister Tito Mboweni on Wednesday tabled a budget that put fiscal consolidation front and centre in a bid to contain mounting State debt and proposed cutting R160 bilion from the public wage bill over the next three years.

The figure is roughly equal to the sum the State has doled out to struggling state-owned enterprises in recent years and sees National Treasury put its foot down with the public service for the first time, as South Africa tries to fend off a downgrade to junk status by Moody’s ratings agency.

Mboweni said he believed the Treasury and trade unions “will find each other” on the measure, and Moody’s would favourably appraise the government’s efforts to bring the deficit back under control.

“Our reading is that they will react to how they read our fiscal stance… I don’t know, but I don’t think they will re-rate us on our fiscal stance,” he told the media shortly before he tabled his budget in the National Assembly.

His speech set out the State’s plans to curb spending by R156.1 billion over the next three years, with savings of R37.8 billion to be realised in the 2020/21 financial year.

Source: iol.co.za