If South Africans expected relief from Finance Minister Tito Mboweni’s maiden budget speech on Wednesday they were sorely disappointed.
Not only did Mboweni announce a steep fuel hike, but you can’t even drown your sorrows in dop and entjies, because those are also going to rise sharply.
There will be a minimal increase in social grants, while the government will be spending billions to bail out Eskom and ensure the lights stay on.
A fuel tax increase of 29c a litre for petrol will kick in from April, and 30c for diesel.
The hikes will be implemented in stages, with the first 20c coming into effect from 1 April, of which 15c will go to the fuel levy and 5c for the Road Accident Fund.
PETROL: A fuel tax of 29 cents a litre Photo: Phando Jikelo/ANA
The remaining 9c and 10c will come into effect in June as a carbon tax.
Meanwhile, a R69 billion lifeline thrown to Eskom over the next three years, "Will cover around 70% of Eskom’s debt servicing costs, opening up room for the utility to use more of its revenue to keep the lights on," chief executive Phakamani Hadebe commented yesterday.
Eskom’s debt stood at around R32 billion a year.
With regards to social grants, Mboweni allocated R567 billion.
There will be an R85 increase in disability and old age grants, war veterans and care dependency grants from R1695 to R1780, and R40 increase for the foster care grant to R1 000.
ALL PAY: R85 increase for old age, disability, war veterans and care dependency grants to R1780 and a R40 increase for the foster care grant to R1 000. Photo: DAVID RITCHIE
The child support grant will increase to R420 in April and to R430 in October.
Treasury expects the number of Sassa beneficiaries to reach 18.1 million by the end of 2019.
Mboweni gave R211 billion towards Safety and Security and said the cash injection will allow for the provision of critically needed equipment and additional staff for the police, SANDF, courts and prisons, and Home Affairs.
And to increase the number of doctors and nurses in public hospitals, Mboweni allocated R2.8 billion to a new human resources grant and R1bn for medical interns.
He then turned a deaf ear to the tobacco industry’s desperate calls to not increase the interest on tobacco from their current level.
The minister, however, announced there would be a special unit focused on tax evasion in order to ensure maximum tax revenue is realised.
With tax revenue revised down by R15.4 billion due to lower than expected VAT refunds, the government wants to collect R15 billion in taxes in 2019/20.
GWAAIS: Entjies will go up by R1.14.
A pakkie20 entjies will cost you R1.14 more, and a beer 12c more.
A bottle of wine will go up by 22c, and whiskey by R4.54.
While there will be no pay hikes for politicians and senior executives at SOEs, government would be offering voluntary early pensions without penalties for workers between 55 and 59, a move which could save government R20 billion.
“The public wage bill is unsustainable. We must shift expenditure to investment,” the minister said.
However, DA leader Mmusi Maimane was unimpressed and said Mboweni failed to deliver.
“This was a lipstick budget, he made it look pretty on the outside but frankly, it’s dealt with nothing,” said Maimane.
“We need a plan that will deliver jobs and ultimately, I don’t want us to debate whether we should hold on to SOEs or not, we should be selling them.”
EXPENSIVE: Wine will go up by 22 cents while whiskey will go up by R4.54.
EFF leader Julius Malema said Mboweni is a man without a plan.
“He did not reduce VAT to 14% and he did not introduce a sovereign fund and it’s very clear that the minister doesn’t know how to take South Africa out of these difficult challenges,” Malema said.
“No clear plans on job creation, no clear plans on what is going to happen on land expropriation because we are busy expropriating the land.”
Social grants get an R85 increase for old age, disability, war veterans and care dependency grants to R1780 and a R40 increase for the foster care grant to R1 000.