Treasury outlining criteria for govt funding of state-owned companies - Minister

Bruce Whitfield interviews DDG Edgar Sishi after Finance Minister Enoch Godongwana tables the Treasury budget vote.

"Honourable Speaker, it is evident that this year will demand of us to face enormous obstacles, some old and many new."

Those were Finance Minister Enoch Godongwana's opening words when he tabled this year's budget vote for the National Treasury.

Godongwana gave the assurance that Treasury remains "strategically steadfast" amidst unprecedented crises.

Bruce Whitfield gets input from Edgar Sishi, Head of Treasury's Budget Office.

Sishi says the Finance Minister reflected very much on the significant risks to the fiscal outlook in his speech.

These include the contingent liability coming particularly from state-owned companies, estimated to have exceeded R1 trillion.

What we have been doing is revising the framework for the kind of support that can be provided, but also providing information on the strategic importance of different entities. That work is ongoing and obviously involves different departments and different ministries...

Edgar Sishi, Head of the Budget Office - National Treasury

What's important is to make sure that we return the public finances to the focus, which is the provision of public goods... and to have in place the kinds of enterprises and entities that are contributing to not just the fiscus, but to economic development and economic growth.

Edgar Sishi, Head of the Budget Office - National Treasury

When we do fiscal policy or we do the Budget, we have to bear in mind that there are things that are not in the Budget that are potentially knocking at the door. We have to be aware of that when we think about the future.

Edgar Sishi, Head of the Budget Office - National Treasury

Sishi highlights the Public Sector Wage Bill as another major fiscal risk.

The debt burden of the state is also a crucial issue being addressed.

Debt service costs this year, in 2022/23, have already crossed the R300 billion mark and are potentially going to rise to over R360 billion...

Edgar Sishi, Head of the Budget Office - National Treasury

... so around R1 trillion over the next three years on debt service costs, which is why it is so important for us to stabilise debt to start returning the fiscal balance, at least on a primary basis, to a surplus... and at the same time achieve higher levels of economic growth.

Edgar Sishi, Head of the Budget Office - National Treasury

Listen to the interview with Sishi on The Money Show:

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