What we’d like from Tito’s medium term budget speech – Sakeliga
23 October 2018
Among other things, Tito Mboweni’s maiden budget speech this week will be a test to see if he is a man of his tweets, according to the independent business community, Sakeliga.
In a letter this week to Sakeliga members, CEO Piet le Roux writes that one key measure of the new finance minister’s medium term budget speech will be his vision for the size of government.
“Does Mboweni believe that government should expand or contract? If he acknowledges the looming fiscal and economic crises for what they are, he will speak of tax restraint in order to stimulate the economy, expenditure cuts in order to halt the slide into debt, and reforming state procurement to make it less race-based and more efficient. Those would be positive signals.”
Le Roux stresses that there are also ways in which Mboweni’s message can convey strong negative signals: “It will be disastrous if Mboweni turns out to be a man of his tweets and confirms, as finance minister, his support for policies such as 40% state ownership of mining companies, a state bank, a sovereign wealth fund, and significantly greater state ownership of land. The last thing the economy and the Treasury needs, is a finance minister who proudly draws his policy insights from Marxist-Leninist theory, the national democratic revolution and radical economic transformation.”