DA: Dr Dion George: Address by DA Shadow Minister of Finance, parliament (09/05/24)

9th May 2024

DA: Dr Dion George: Address by DA Shadow Minister of Finance, parliament (09/05/24)

Thank you, Chairperson.

Our economy is not growing and South African households are battling a government induced cost of living crisis that has left 81% of households unable to put enough food on their tables. 5 million children are starving, according to the Nelson Mandela Children’s Fund. The root cause of this situation is a dysfunctional, corrupt and incompetent government, positioned in the wrong place in our economy.

ANC mismanagement of our public finances and failed economic policy has set fire to the hopes and dreams of the millions who are unemployed despite the massive opportunities that our country could offer. Shell, BNP Parabas and BHP have sent a very strong signal from the market that ANC policy has failed South Africa.

The ANC government is borrowing more than one and a half billion rand a day and the cost of servicing our five trillion rand mountain of debt is fast approaching one billion rand per day. This debt accumulated over time and funded consumption spending and not vital spending on infrastructure. It also funded massive bailouts to State Owned Enterprises, yet we still don’t have the reliable electricity supply, functional railways or ports that our economy desperately needs.

The steep rise in interest payments has diverted vast amounts of resources away from schools, hospitals, police stations, and other vital public services. Frontline public sector workers are forced to do more with less.

In 2008, our debt-to-GDP ratio stabilised at a healthy 27%. Over the past 15 years, this escalated rapidly to the 74.1% we have now and we should prepare for a much larger interest bill, unless the people change the government on the 29th.

Currently, Government allocates the largest share of its budget to the public sector wage bill, largely to the benefit of high-ranking, cadre deployed, bureaucrats. There are nearly 38,000 who earn over one million Rand annually. The number of public officials in this pay bracket has surged by almost 300% since 2014. ANC alliance partner, COSATU, has never mentioned this disparity.

The introduction of the DA’s ‘Responsible Spending Bill’ into Parliament marked the first real attempt to address uncontrolled spending, a top-heavy bureaucracy, and an escalating debt crisis, head-on.

The Bill proposed the introduction of a debt rule to complement the existing expenditure framework. It proposes a progressive shift in fiscal policy that aimed to enforce discipline by setting sustainable limits on government debt accumulation and spending. If performance targets were not met within the fiscal year, the Bill would have held those responsible for mismanaging public money accountable through targeted wage adjustments.

The DA has always stressed the importance of protecting frontline services from expenditure cuts. Therefore, contrary to COSATU’s claims, the Bill would have protected public sector employees who are covered by the Occupation Specific Dispensation fund. These are the dedicated nurses, teachers, and police officers who serve tirelessly yet disproportionately bear the brunt of the current government-induced cost-of-living crisis.

During the discussions at NEDLAC, organised labour failed to offer any input after having been granted multiple opportunities to do so. When the Bill was deliberated in committee, COSATU falsely claimed that the Bill had not been submitted to NEDLAC, made a political speech for its ANC handlers and attempted to frame the Bill as an attack on frontline workers. The union does not care about the impact that the debt burden has on the very people they claim to represent. COSATU is protecting cadre deployed management at the expense of the workers.

The DA has launched an economic policy that will unlock the enormous potential of young South Africans in particular, battling a COSATU-backed system what now ensures they will never be employed in their lifetimes.

A Youth Employment Opportunity Certificate will free job seekers between the ages of 18 and 35 who have been unemployed for 12 months or more from the restrictive labour regulations that currently locks them out of the job market. ANC imposed job reservation must end. A DA-led government can generate 2 million jobs over the next 5 years.

When the ANC loses its majority later this month, the DA will reintroduce this Bill, stop the fire currently destroying our economy and rescue South Africa.

We reject the report.

Thank you, Chairperson