Mboweni accused of lying in budget speech

Finance Minister Tito Mboweni may be summoned before parliament’s ethics committee for making allegedly misleading statements during his mid-term budget speech, reports the City Press.

DA Chief Natasha Mazzone said the party would be laying a charge against the finance minister for accusing Tygerberg Hospital – which is situated in the DA-run Western Cape – of being racially segregated.

Mazzone called this statement a “blatant and damaging lie and a slap in the face of all the hard-working doctors, nurses and staffers who daily put their lives on the line to protect us in the Western Cape from the COVID-19 crisis.”

The Public Servants’ Association (PSA) was also critical of Mboweni for statements made in his speech.

It alleged that Mboweni made fake statements about negotiations between the PSA and the Minister of Public Service and Administration Senzo Mchunu.

“Mboweni also stated that Mchunu is engaging with unions on public sector wages and the public service wage bill,” said the PSA.

“This statement is untrue, as no such engagements are taking place.”

The PSA added that new wage demands have yet to be tabled and the Labour Appeal Court must still rule on the South African government’s failure to implement the final stage of the agreement between the parties.

“Had the employer opted to approach labour through the PSCBC [Public Service Coordinating Bargaining Council] first, Mboweni’s statement that there’ll be no increases for the next four years wouldn’t have been regarded as a clear undermining of collective bargaining in the public service and blatantly disrespectful of unions,” said the PSA.

Cosatu also said that Mboweni had lied when he said that Mchunu was engaging with unions.

“He was lying. We can’t open negotiations with government while we have a legal dispute over the non-implementation of the last agreement.”

Mboweni’s plan to save the economy

These allegations follow Mboweni’s Medium Term Budget Speech, which detailed how the government plans to avoid a sovereign debt crisis.

Mboweni proposed a five-year plan that he said will promote economic growth and will bring South Africa’s debt issue under control.

The revised fiscal framework would put South Africa on a course to stabilising the ratio of debt-to-GDP at around 95% within the next five years.

Mboweni added that the medium-term fiscal strategy will change the main budget primary deficit from an expected R266 billion in 2021/22, to a surplus in 2025/26.

If Mboweni’s plan were to be successful, he said the South African economy would grow by 3.3%, 1.7%, and 1.5% over 2021, 2022, and 2023 respectively.

One of the key drivers in this strategy would be freezing the public sector wage bill for three years.

Treasury said that government proposes growth in the public service wage bill of 1.8% this year, with an average annual growth of just 0.8% over the 2021 Medium Term Expenditure Framework period.

“To achieve these targets, which are essential for fiscal sustainability, government has not implemented the third-year of the 2018 wage agreement,” said the National Treasury.

“Furthermore, the Budget Guidelines propose a wage freeze for the next three years to support fiscal consolidation.”

Main budget non-interest spending would also be reduced by R60 billion in 2021/22, R90 billion in 2022/23, and R150 billion in 2023/24.

The largest portion of these reductions falls on compensation, while other non-interest spending items will also be reduced.

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Mboweni accused of lying in budget speech