Finance Minister Parvin Gordhan says the government's objective is to achieve inclusive economic growth in South Africa.
During his Medium-Term Budget Policy Statement, Gorhdan told the public that the ailing economy can be restored if all sectors collaborate.
The finance minister says that if government does not collect and generate revenue for the economy, there will be hit on both taxes and expenditure.
He says that it will take collective responsibility to support confidence and investment in our economy, while also creating a predictable policy and political environment.
What we seek to achieve, and more, can be done if we collectively make the right choices... and put the national interest first.— Pravin Gordhan, Finance Minister
Below is a summary of the medium term outlook:
- economy expected to grow by 0.5% for 2016, down from the 0.9% estimated in February.
#MTBPS2016 PG: global growth has slowed, our own 0.5% - rising to 1.7% in 2017. Measured and balanced fiscal consolidation will continue. NM— EWN Reporter (@ewnreporter) October 26, 2016
- budget deficit will decline from the current 3.4% to 2.5% in 2020.
Gordhan: measured and careful fiscal consolidation will continue to bring down country's debt. R43bn needed in extra tax over 3 years.GD— EWN Reporter (@ewnreporter) October 26, 2016
- proposes raising an additional R43 billion rand through tax measures over the next two years, R28 billion of which will be in the coming financial year.
- government predict there will be R23 billion less revenue than what was initially was forecast in the 2016 Budget Speech in February.
- the expenditure ceiling will be lowered by R26 billion.
- consolidated government expenditure will rise by 7.6%
#MTBPS2016 This year we pay more than R147bn interest on R2 trillion debt. (Fastest-growing expenditure item in Budget). GD— EWN Reporter (@ewnreporter) October 26, 2016
- additional increase of R10 a month has been made to social grants with effect from October.
- additional allocations for tertiary education, healthcare services and social protection
- proposes a further R 9 billion for the National Student Financial Aid Scheme (NSFAS) over the period ahead (an additional 18% a year).
#MTBPS2016 Gordhan on post-school education spending now 2nd fastest-growing budget item. (More stun grenades & water cannon outside) GD— EWN Reporter (@ewnreporter) October 26, 2016