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People’s Budget welcomes Manuel's expansionary tone

19th February 2004

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The People’s Budget Campaign yesterday welcomed the allocation of resources for the expanded public works programme (EPWP), announced in Finance Minister Trevor Manuel’s Budget speech for 2004/5.

The organisation is spearheaded by the Congress of South African Trade Unions (Cosatu), the South African Council of Churches (SACC), and the South African NGO Coalition (Sangoco).

It also welcomed the continuation of the expansionary approach adopted by the National Treasury over the past three years, saying increased spending is essential to deal with the persistent social disparities caused by apartheid.

It continued by saying the EPWP can make a valuable short-term contribution to addressing the high levels of unemployment, which has now been acknowledged by government as its primary challenge. However, the campaign said it is concerned that only R15-billion has been earmarked for the programme over the next five years, with particularly low spending in the social services.

It also noted with concern that the tax concessions amounting to R75-billion since 1994, represents a significant loss to revenue, where the tax/GDP ratio over the MTEF remains firmly pegged at 24,6% and called for the ratio be raised to around 29% to acquire much needed resources for social spending, but claimed that this has not been accommodated.

The campaign said that it believes that the simplest, most comprehensive and cost effective strategy to address income poverty would be to introduce a Basic Income Grant.

It also applaud the allocation of R12,4-billion over the next three years for the implementation of a national HIV/Aids prevention and treatment plan, as well as the continued stabilisation of the defence budget after the disproportionate increases of the earlier years, due to the arms deal.

Overall, the campaign said it will continue to call for public participation in formulation of the budget and the Constitutional obligation of tabling a money bill to allow Parliament to amend the budget to create the opportunity for oversight by legislature and serious consideration of proposals by civil society.
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