MEDIUM TERM BUDGET POLICY STATEMENT 2023

MEDIUM TERM BUDGET POLICY STATEMENT 2023

• 01 November 2023
• Parliament
• SA Legal Academy

Debt-servicing costs are expected to ‘exceed all individual consolidated spending sectors by function’, reflecting the increasing extent to which they will ‘crowd out spending on basic services and other policy priorities’. This is according to a presentation document posted on the National Treasury website with the Medium Term Budget Policy Statement and Finance Minister Enoch Godongwana’s speech.

Against the backdrop, during the three-year period covered by the 2024 medium term expenditure framework, among other things:

• ‘61% of consolidated non-interest spending will go to the social wage’ (‘primarily … healthcare, education and social protection) and ‘vulnerable households will continue to receive support’
• the ‘reconfiguration of government, with the merging or closure of public entities’, will continue
• government will remain ‘committed to remunerating all its employees fairly, while balancing wage increases with the sustainability of public finances and broader policy priorities’
• ‘most national and provincial departments will absorb the carry-through costs of the 2023 public service wage agreement’ and will ‘reprioritise spending’ accordingly
• ‘funds from existing programmes will be repurposed to extend the presidential employment initiative into 2024/25’, and
• ‘government will improve the quantity and quality of infrastructure delivery’ by ‘significantly increasing’ private sector involvement in financing projects and providing technical expertise’ through:
  • ‘widening the scope of concessional borrowing where interest rates are competitive’
  • ‘creating a new mechanism to facilitate co-investment with the private sector and multilateral institutions’, and
  • ‘employing alternative financing instruments for priority projects’.

Related to plans for increased infrastructure delivery, according to the Minister’s speech amendments are being drafted to ‘Treasury regulations and key elements of municipal legislation’ to reflect recommendations emerging from a review of the public-private partnerships framework. They are expected to be published ‘by the time of the Budget 2024’.

Responding to the recommendations for governance and financial management reforms included in the Zondo Commission, Mpati Commission and Nugent Commission reports, according to the Minister’s speech:

• an ‘Omnibus Bill’ expected to be released ‘shortly’ for public consultation will propose ‘key amendments to various pieces of legislation’, including:
  • the Public Finance Management Act, 1999
  • the Municipal Finance Management Act, 2003, and
• the South African Revenue Service Act, 1997.

Parliamentary hearings on revised fiscal framework and revenue proposals outlined in the MTBPS are scheduled to take place on 8 November 2023. With that in mind, the National Assembly’s Standing Committee on Finance and NCOP Finance Committee have issued a joint notice calling for written submissions by 6 November 2023.

• MTBPS (full document)
• MTBPS speech
• MTBPS presentation
• joint committee notice calling for submissions

Published by SA Legal Academy Policy Watch

0 COMMENTS

LEAVE A COMMENT