The Mid Term Budget Policy Statement should acknowledge that it can no longer be business as usual.

COSATU is looking forward to the upcoming Mid Term Budget Policy Statement, to be delivered by the Minister of Finance tomorrow, in Parliament. Our position and expectations is that, the Treasury’s statement will reflect the dire economic situation that our economy is in ,and will bring about coherent policy proposals aimed at intervening in the economy ,to avoid a looming crisis. We expect the statement to acknowledge that it can no longer be business as usual.

As a country ,we have not been able to make sufficient progress in the struggle to ensure decent permanent work for all.  We have not been able to significantly reduce our 35% unemployment rate ,and we still hold the unenviable record as the most unequal society in the world.  Too many South Africans remain condemned to a life of grinding poverty. Government is called upon to provide bold and decisive leadership .We need an urgent plan on how to turn the economy around and ensure that there is rapid creation of permanent decent work for all.

The task of fundamental transformation of our economy, the creation of decent work and the provision of basic services to the majority of our people, cannot be left to the market forces. We need a strong developmental state to intervene decisively in the economy to redistribute resources in order to address unemployment, inequalities, poverty. We need the MTBPS to be informed by this key strategic objective.

Expenditure

COSATU urges government to move away from its conservative fiscal and monetary approach. It is because of voluntary austerity measures and government’s tinkering that the economy is haemorrhaging jobs.  What is needed is a government driven infrastructure expenditure to push and kick start it and to ensure the creation of badly needed jobs for all.  Now is not the time to reduce badly needed state driven infrastructure building and expenditure. 

We commend attempts by government to eliminate, the all too prevalent bling culture entrenched in too many of its departments. But we expect these efforts to be intensified and a serious crack down on those departments, who resist measures to eradicate wasteful expenditure as well as corruption.

Youth wage subsidy

Government has failed to explain, how many of the older workers have been displaced or how many of the subsidy claims are for new or existing jobs.  Many of the subsidies are going to labour brokers.  Cosatu is adamant that this is not helping job creation and is demanding that it should not be renewed ,when it lapses at the end of 2016.

Taxes

We do not expect government to increase the burden of personal income taxes and electricity service charges on lower and middle income families again.  The tax increases in 2015 already hit workers hard.  Workers cannot afford another tax increase.  COSATU will fight any increase in VAT as flagged in the Davis Tax Commission.  VAT is a regressive tax which hits the poor, the hardest.  We want to see a wealth tax imposed instead upon wealthy individuals and companies as well as a tax on luxury goods.  Any attempt to increase VAT otherwise will devastate the poor and we will aggressively resist it.

Public wage bill

COSATU rejects Treasury's fear mongering and blaming of public servants' wages for their fiscal constraints.  We expect the Treasury to lift the decision to freeze the filling up of state vacancies because public servants play a key service delivery role.  They deserve and need to be paid a decent living wage, which includes above inflation annual increases.  The filling of vacancies is needed to ensure government is capacitated to provide service delivery.

NHI

Government needs to release the long awaited NHI discussion paper and funding model.  This is long overdue.  The two tier health system is unsustainable and workers are tired of being catered for by a badly over stretched public health service ,while the lucky few who can afford it, have access to world class private medical care.

Retirement Reform and Comprehensive Social Security

Government must release its long promised discussion paper on comprehensive social security.  We expect them not to proceed with retirement reforms until this paper is released for engagement at Nedlac. 

Eskom

We appreciate the fact that the past two {2} months were free of load shedding and we applaud government’s intervention that has worked so far. We expect that Treasury will propose  an added increase in the investments in renewable energy.  This is not only environmentally and health safe but it has already created 20 000 jobs and more is needed. 

Government must open up and share its nuclear plans with the public that elected it.  COSATU is strongly opposed to nuclear energy.  It is costly, takes long to build and is risky to the environment and the health of South Africans.

Basic Education

We want to see school infrastructure being properly funded and fixed.  We want to hear that all mud schools have been replaced and that all schools have sufficient decent toilets.

Higher Education and Training

Whilst government has done excellent work since 1994 in increasing student bursaries from R10 million to R10 billion, we expect to hear that the administrative chaos in NSFAS is being addressed and that we are moving towards free tertiary education.  The current crisis at our universities shows that students and their families can no longer bear the high prices being forced upon them.  Now is the time for a bold and decisive intervention. We also expect Treasury to reclaim the financial reserves that have been privatized by many universities and are sitting in their accounts.. They should be audited by the Attorney General and  turned over to National Treasury for funding of academic projects in schools.

Basic Services, Land Reform and Restitution

We want to see progress with regards to funding land reform and restitution projects.  There have been far too many failures and backlogs.  The Department of Rural Development is woefully underfunded and thus not able to deliver upon its mandate. We want to hear that the bucket system has been ended.  In particular in informal areas on occupied land.

E Tolls and Transport

We want to see E Tolls scrapped and government committing to not ever again attempt to privatise public roads in future.  We want to see government put in place plans and investments to provide for safe, accessible, affordable and reliable public transport.  Government must accept that the public has overwhelmingly rejected E Tolls.  Government must scrap this failed project and commit to never again privatising access to public roads.

Parastatals

We demand that all parastatals put a moratorium on their retrenchment plans.  We cannot afford to throw workers to the already long unemployment line.  Government must engage unions on how to help address the management failures at the parastatals as well as to ensure proper funding models for them. They should be reoriented towards service delivery and should focus on delivering the development agenda of the ANC led government. They should be given an explicit mandate to focus on the provision of services and the reduction of costs of basic services.

Expanded/ Community Works Programmes

Whilst COSATU appreciates government’s efforts to create work for the long term unemployed, COSATU remains distressed that many departments and municipalities are abusing this programme as a form of cheap labour. They are replacing what should be permanent decent work with temporary cheap vulnerable labour.  We also expect to hear about the issue of skills transfer if any has happened under this programme. The EPWP/ CWP posts should be absorbed in the departments and municipalities and converted to permanent decent jobs.

Issued by Cosatu National Spokesperson Sizwe Pamla, 20 October 2015