The South African Federation of Trade Unions (Saftu) on Tuesday condemned President Jacob Zuma’s plan to identify concrete measures to urgently address the challenges identified in the Medium Term Budget Policy Statement.

On Monday the Presidency said that Zuma had directed Finance Minister Malusi Gigaba, assisted by the Presidential Fiscal Committee, to brief him this week on plans to cut government expenditure following the latest downgrade of the country’s long-term local currency credit rating to junk status by Standard & Poor’s on Friday.

It was reported on Monday that Zuma wanted to see progress on plans to cut government spending by R25-billion and on how it would raise tax income by up to R15-billion, following the latest ratings downgrade.

Saftu said this summed up just how hollow Zuma’s talk about radical economic transformation really was.

“There could not be a less radical and less transformative solution to the country’s economic crisis, than the massive public spending cuts and tax increases which he is demanding from the National Treasury,” added Saftu.

Zuma stressed that the proposed cuts in expenditure should not be in areas that would negatively affect economic growth prospects and job creation.

Saftu stated that unemployment in South Africa was six times the world average.

It added that more than a quarter of the population was hungry every day and half of all South Africans did not have sufficient access to enough food to meet basic nutritional needs.

Other proposals included fee-free higher education for students from poor and working-class backgrounds, and identifying economic stimulus measures to grow the economy faster.

“The tax rises will hit the poor directly through PAYE deductions and any increase in VAT, which we all pay every time we buy something, but also indirectly by giving capitalist businesses a reason for not investing and creating jobs,” said Saftu.

Saftu has already accused Zuma of “robbing Peter to pay Paul” to fund his proposal for free tertiary education for families on annual incomes of less than R300 000, which is estimated will cost the country R40-billion.

“’Peter’ is going to be robbed of R25-billion, previously budgeted for school building programmes, municipal infrastructure, passenger rail transport and provincial roads, with the remaining R15-billion to come from higher taxes. His new statement makes it highly improbable that he was ever serious about this promise and that ‘Paul’ will ever see his R40-billion,” Saftu said.

Saftu added that even if it went ahead, because of the R25-billion cuts, students, as well as workers and South Africans as a whole, will suffer from worse service delivery, more job losses, more delays in implementing the national health insurance system, and deeper poverty and hunger.

The federation said the biggest tragedy was that this need never have happened, as South Africa was potentially a wealthy country.

“The ANC was brought to power with huge and enthusiastic support from the people. From the start, however, it was held back by the terms of the negotiated settlement which conceded political power to the majority but kept the economy firmly in the hands of the white, monopoly capitalist class,” said Saftu in a statement.