In his National Budget speech on Wednesday, the Finance Minister took the hard road that the new President pointed down last week with the State of the Nation address, stripped of the promises for radical economic transformation. Yes, free higher education, if only for students from households with a combined income of R350,000, is a step forward and testament to the #Feesmustfall struggle. But this is not a sign of a progressive budget; it is its fig lead since the concession is to be funded by cutbacks in social spending.
With the decline in government revenue, Minister Gigaba has turned to cutting basic education infrastructure expenditure by R14-billion over the next 3 years in real terms, Health infrastructure by R1.2-billion and Human Settlements by R9-billion. And casting the revenue net widest with the 1% hike in VAT, the budget gouges the revenue shortfall from the poor.
Typical of neoliberal economics, the austerity is bargained as the pain that must be inflicted to attract foreign direct investment and for the economy to grow. This faith in monopoly industries, particularly mining, to deliver job-creating growth is a ruse. The betrayal of that faith needs no longer iteration than the whole history of their ‘investment’ in the country. This is no new dawn as heralded by Ramaphosa – it’s just the view from the bottom of the pit, that he and the ruling ANC wants the country to continue digging.