BOKAMOSO
Budget 2018/19 perfectly illustrates the reality of populism
Budget 2018/19 brings to mind the popular quote: “insanity is doing the same thing over and over and expecting different results”. In the name of social justice, the ANC government has clung to populist policies such as restrictive labour legislation, a large public sector wage bill, a high degree of state ownership of the economy, over-powerful unions (especially SADTU) and restrictive, race-based empowerment policies.
These are made in the name of the poor, and yet they hurt the poor most. The fact is, the only way out of our social and fiscal problems is through robust economic growth. And the only way to achieve that is through fundamental policy reform that emphasizes growth over redistribution.
Nothing in the budget suggests that is going to happen any time soon. So the poor will continue to pay the heaviest price for ANC government failures, just as they do in this budget whose one percentage point increase in VAT and 52c per litre fuel levy hike both hit the poor hardest.
President Ramaphosa has inspired great confidence that he will tackle corruption and state capture and fill his cabinet with capable individuals. These are welcome changes, the first essential steps to reversing our social and fiscal decline.