MTBPS 2016 must prioritise economic growth and job creation 

24 October 2016 

The Minister of Finance, Pravin Gordhan, will deliver the medium-term budget policy statement (MTBPS) on 26 October 2016 in Parliament. 

He does so in an environment characterized by high levels of political uncertainty; low economic growth, high inflation, and very high unemployment; and a possible sovereign ratings downgrade of South Africa.  

The minister is under siege following the decision by the National Director of Public Prosecutions, Shaun Abrahams, to charge him with fraud for authorizing a transaction, which he claims was “entirely lawful”. 

However, he is not backing down: he seems to have decided to “burn the ships on the beach” and take the fight to the “rent seekers”, including President Jacob Zuma and his most important clients, the Guptas. 

The minister will have to make some tough choices and in our view should cross at least four “red lines” in order to give hope to the 8.9 million people who do not have jobs, or have given up looking for jobs, in South Africa. 

These include: 

- announcing a package of structural reforms to boost economic growth and create jobs in South Africa;

- holding the fiscal line by maintaining the fiscal deficit at 3.2% of GDP in 2016/17;

- crowding in private sector investment by announcing that a private equity partner will be sought for South African Airways; and

- announcing plans to fund a zero percent fees increase for all students who come from households earning less than R600 000 per annum, in the amount of at least R2.5 billion for 2016/17. 

Issued by David Maynier, DA Shadow Minister of Finance, 24 October 2016