Spending on social services remains the key component of South Africa's Budget, rising from R229,8-billion in 2005/06 to R262-billion in 2006/07. Education remains the biggest consolidated Budget item at R110,3-billion in the 2008/09 estimates. Education received R83,5-billion in 2005/06.
Naledi Pandor and Lindiwe Sisulu wore broad grins during Wednesday’s Budget speech, as Minister of Finance Trevor Manuel repeatedly turned towards their seats on Parliament’s front benches to announce new funding for projects that put education and housing at the heart of the government’s social development plans.
The Treasury should not be congratulated on its R48-billion allocation to health because the R8-billion increase has not kept up with inflation or with the increase in health practitioners’ salaries, say health analysts. "You can have beautiful clinics, but if there is no one [motivated] to work in them, what is the point?"
"We must all work together to pull the wagon through the drift," Trevor Manuel said in every official language but English on Wednesday. And he is using all the room available in the Constitution to ensure that local and provincial governments get their shoulders to the wheel. His balancing act was eased by a larger-than-expected tax overrun.
Minister of Finance Trevor Manuel has allocated the largest tranche of the Budget to the provinces — but National Treasury is to exert a much firmer grip on how provincial and local governments spend their money. A key reform introduced in this year’s budget is a change in the way social grants are funded.
It will come as no surprise that Minister of Finance Trevor Manuel has targeted car allowances in this Budget. After numerous hints last year from the minister and South African Revenue Service Commissioner Pravin Gordhan, Manuel has taken action to reduce the abuse of car travel allowance.
The CEO of Stanlib Asset Management, Allan Miller, is looking gleefully at the increases for police officers and teachers to guide his investment decisions. The move will put more money in their pockets and they will be able to increase spending as well as take on more credit.
With almost half of South Africa categorised as poor, the national Budget must be looked at for its impact on poverty. To what extent does it extend an effective social welfare net and how much tax relief is targeted at working-class families as opposed to the wealthy?
"Going once at R27 000, twice at R27 000, gone!" That’s the price paid at auction this week for Minister of Finance Trevor Manuel’s 2005 Budget speech and neckwear. The speech and the red-and-cream striped tie fetched about half of last year’s price at the traditional African National Congress post-Budget fund-raiser.
Thanks to an unexpected increase in revenue of more than R11-billion this year, Minister of Finance Trevor Manuel again played Mr Nice Guy and cut individual taxes by a further R6,8-billion. This bonanza is aimed at the lower-income earner, with 62,8% of the benefit going to people who earn less than R200Â 000 a year.
The Chamber of Mines has described this year's Budget as a success in "balancing the need for a higher social wage with a need to promote a supply-side investment environment for business". Chief executive Mzolisi Diliza said the Budget has provided a framework for a higher and more sustained economic growth rate.
Five percent Gross Domestic Product (GDP) growth in South Africa is "doable" in 2005, Finance Minister Trevor Manuel said in a post Budget briefing on Thursday. In his Budget speech on Wednesday, Manuel forecast 4,3% growth in GDP, which he said was in line with the consensus of economists, compared with last year's 3,7%.
The tobacco industry has reacted with mixed feelings to Minister of Finance Trevor Manuel's announcement on Wednesday of an increase of 7,5% and 14,9% in tobacco tax, saying the increase will add to the attractiveness of South Africa as a target market for groups who deal in counterfeit and smuggled cigarettes.
The Treatment Action Campaign (TAC) says it is happy with the amount Minister of Finance Trevor Manuel set aside for HIV/Aids on Wednesday but worries about whether it will be spent properly. The total budget for fighting HIV/Aids will rise in the coming year to about R4,3-billion, a rise of about R1-billion over current spending.
South African economists have reacted positively to Finance Minister Trevor Manuel's Budget speech delivered on Wednesday, saying they were surprised by the 1% cut in corporate tax, but that it was a "stimulus is in the right place". Dawie Roodt from the Efficient Group said the government had shown itself to have "real guts".
There has been a 76% increase over the past three years in the number of people receiving disability and care dependency grants in the Eastern Cape, according to the Budget Review tabled by Finance Minister Trevor Manuel at Parliament on Wednesday.
Whether drowning your sorrows or celebrating your fiscal gains in 2005, both will be more expensive as Minister of Finance Trevor Manual has announced increases in excise duties on most alcoholic beverages on Wednesday during his Budget address. Also, from March 1, buying a house will cost buyers less as Manuel announced the reduction of transfer duties on properties.
The Inkatha Freedom Party was the first to welcome Finance Minister Trevor Manuel's 2005/06 Budget tabled in Parliament on Wednesday. The party said while the Budget was "highly commendable" it had some doubts over whether the government could meet its implementation requirements.
Excise duties on alcoholic beverages have been increased by between 9,4% and 20% as part of the government's 2005/06 Budget, according to Minister of Finance Trevor Manuel. Excise duty on unfortified wine and sparkling wine will see the largest increases (20% each on a nominal basis, 15,8% real).
South Africa's national Budget presented on Wednesday provides R6-billion for the land restitution programme over the next three years. Finance Minister Trevor Manuel said this would be to "complete the programme" -- although Agriculture and Land Affairs Minister Thoko Didiza has estimated R13-billion would be needed to wrap up the programme.
Naledi Pandor and Lindiwe Sisulu wore broad grins during Wednesday’s Budget speech, as Minister of Finance Trevor Manuel repeatedly turned towards their seats on Parliament’s front benches to announce new funding for projects that put education and housing at the heart of the government’s social development plans.
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