MTPBS in a Nutshell

• Treasury is now forecasting the economy will grow at 0.5% in 2019 – one third of the rate expected during February's main Budget address.
• As a result of the weaker than expected economy, revenue is now expected to be down R53bn (4%) on the R1.37bn projected in the main Budget.
• Government spending is expected to end the fiscal year R23bn above February's budgeted number, due solely to the additional R26bn in emergency funding for Eskom, taking its total support for the year to R49bn.
• As a result of the revenue shortfall and the overspending, SA's budget deficit is now projected at 5.9% of GDP.
• SA's national debt has now risen above R3trn and the debt-to-GDP ratio for the current fiscal year is projected at 60.8% compared with the 2019 Budget projection of 56.2%. At the current rate debt will exceed 70% of GDP by 2022/3.
• Treasury has identified potential spending reductions in goods and services of R21bn in the next fiscal year and R29bn in 2021/2.
• Tito Mboweni is targeting a balanced budget (excluding injections into Eskom) by 2023 by saving R50bn a year.
• There are now 29,000 public servants earning R1m or more a year which, after adjusting for inflation, is double the number of 12 years ago.
• In real terms, the average government wage has risen 66% in the past decade, with last year's increase averaging 6.8% – a hike of 2.2% after adjusting for inflation.
• "For the foreseeable future" salaries of SA's cabinet members, Premiers and MECs will be frozen, with downward adjustments likely.

• The cost of official cars is being capped at R700 000, VAT inclusive.
• A new cell phone dispensation is being introduced to cap the amount which public servants can claim from the State.
• All public sector officials will fly economy class on domestic flights.
• There will be no more payment of subsistence and travel allowances for public servants on both domestic and international trips.
• Over the next two years, an additional R1.3bn has been set aside for the National Prosecuting Authority; while SA Revenue Services will receive an extra R1bn over the period.
• Over 14 000 hectares of State-owned land has been released for human settlement development.
• By February, the SA Reserve Bank will submit a proposal on cross -border money flows to introduce more modern, transparent and risk-based approvals processes.

Alec will present his findings from today's Medium Term Budget Policy Statement with a webinar this evening at 7pm allowing you to pick up the highlights from the comfort of your own home. Courtesy of BrightRock's sponsorship, it's free, but you must register beforehand – click here to do so.