Gigaba’s Last Stand turns a Budget highlight into disappointment

By Alec Hogg

Spent a productive seven hours in South Africa’s Parliamentary precinct yesterday ahead of and immediately after the National Budget speech. Erm, make that five and a half because sandwiched between the intensive “lockup” study and getting my copy back to the team were 90 minutes lost in the traditional embargoed pre-address press conference.

This year’s presser was awfully disappointing. All five of the fellows on the podium facing over 100 journalists are bald. But outside of that, there is little similarity. Treasury DG Dondo Mogajane and SARB Governor Lesetja Kganyago are class acts. But the former hardly got a word in while the latter literally didn’t.

File photo: Finance Minister Malusi Gigaba. Photographer: Halden Krog/Bloomberg

Instead, finmin Malusi Gigaba took up 90% of the time vacillating between defending himself against a damning court judgement out that morning; and mouthing second half explanations on a subject he should leave to others.

His emotional deputy Sifiso Buthelezi, a Zuma-thinkalike, used the platform to do some political grandstanding. And SARS head Tom Moyane asked for more time before he was judged. It looked to me very much like the Finance Ministry’s version of Custer’s Last Stand. Thank goodness.

Comment from Biznews community member Brian Wasmuth:

‘Earlier today I made the comment that we were naïve to think that our ANC government, post 1994 would be any different to any other post-revolution regime, whether on our continent or any other continent.

Invariably most have driven their countries to the brink of failed statehood and in many instances, these countries have actually become failed states.

Post-1994 there was a period of euphoria and in fact there was a period of economic growth and intelligent ministers of finance, Trevor Manuel probably being the most eminent, put South Africa on a growth trajectory which promised a bright future for South Africa and all of its peoples, especially those who had suffered under apartheid.

And then, the populists and the aspiring demagogues and the ideologically deluded came into the picture and since 2009 we have been on a declining economic trajectory, ruled by those who can only be described as political and economic fools.

In December 2017, Cyril Ramaphosa becomes president of the ANC and a week and ½ ago, he becomes the president of South Africa; he delivers an inspiring state of the nation speech and it gives us all hope that Cyril’s leadership will change, albeit over time, the downward spiral and place us on an economic growth trajectory which provides ‘a place in the economic sun’  for all South Africans and restoration for those who were afflicted by the evils of the pre-94 regime.

And then on 21 February 2018, Malusi Gigaba, a Zuma sycophant, alleged co-conspirer in state capture and clearly not an economic genius, presents a budget.

Let’s take 3 things from the budget speech:

  1. the Minister of finance started off with a load of esoteric ideological balderdash;
  2. the Minister of finance rambled on about many actions that were going to be taken, but did not even pontificate tangibly about one single measure to be taken to address the very  structure of the South African economy, such that the economy would be placed on a growth trajectory, move toward at least a semblance of productivity, realise its potential to have a semblance of global competitiveness in certain sectors and ultimately address the socio economic plight of most of its inhabitants (poverty, unemployment, services, education, et cetera); there was no semblance of a ‘Marshall plan’ or ‘the Singapore story’; only an intention to spend bucket loads of money in areas which clearly had the intention of populist appeasement (and of course we need to address the social plight of our countrymen).
  3. The Minister of finance then proceeded to impose an increased tax burden on the only productive sector of the economy, further strangling the ‘goose that lays the golden egg’; yes, the Minister has bills to pay, but you ‘cut your cloth to suit your pocket’; the productive sector of the economy will continue to decline; he naïvely spoke about tax morality and a commission of enquiry into the state of SARS, or should one talk about the state capture of SARS. So, the productive sector will decline, unemployment will persist, inflation will have an upwards trajectory, local direct investment in plant and equipment and bricks and mortar will decline and even dry up, consumption expenditure will decrease, and the R1.6 trillion which he expects to collect in tax revenue, may in fact be a pipe dream.

So, combine the thought of a structurally flawed economy with an over taxed productive sector of the economy slowly but surely wilting under an increasing tax burden by an obviously inept populist and ideologically deluded government, and you have a disaster on your hands.

Now we do have one hope, and that is Cyril Ramaphosa; the man is a sophisticated and intelligent and obviously competent individual who has been confronted with a cabinet and a government infrastructure that by all accounts, gauging by the last 9 years, is inept to the 10th°; so he has one hell of a task on his hands to change all of the above and as civil society and business we need to give him our support, we need to give inputs, we need to make demands and we need to insist on prudent governing of our country; we can only trust that he will see through the sycophantic Gigaba and rid us of him and all the other cabinet ‘geniuses’ who have taken us as a country to the brink of disaster.’

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