PRESIDENT: Cyril Ramaphosa
IN NOG ’n blow to South Africa’s financial future, Cabinet has reportedly rejected a reworked budget – this time without the 2% VAT increase.
President Cyril Ramaphosa called a special Cabinet meeting this week to work out the government’s money matters after last week’s budget speech by Finance Minister Enoch Godongwana was postponed.
This is the second time in a week that Cabinet has rejected the budget.
Prior to last Wednesday’s presentation of the first budget, the ministers were against it.
The budget speech was moved to 12 March after parties failed to agree on the budget.
A source within the Cabinet told IOL that it was not an easy matter to deal with, because this had already painted a bad image of the minister.
The immediate response was to resolve the matter, set up a sub-committee that would look into the matter but with the help of Cabinet.
According to the source, this would be chaired by Deputy President Paul Mashatile.
The insider says: “The full details will be known... remember this thing is still ongoing and we cannot just speak to it as if decisions have been made.”
Despite the conflicts, another source said the budget would still be tabled next month.
Cabinet spokesperson and Minister in the Presidency, Khumbudzo Ntshavheni, tweeted that this was fake news. IOL tried to get a comment from her, but to no avail.
Responding to the claims, Ntshavheni’s Media Liaison Officer, Sipho Mbele, says: “I don’t think the minister will respond to that… That is fake news… I am in a meeting.” He hung up the call without hesitation.
A few proposed budget cuts included R29 billion over the Medium-Term Expenditure Framework. This reduction would impact the hiring of unemployed doctors and the provision of related healthcare services.
This proposed cut would prevent 11 000 teachers from being hired, which would have an impact on early childhood development initiatives required by the Basic Education Laws Amendment (Bela) Act.
Also a R2bn cut for prison warders lowers the amount of money available for correctional facility staffing.
According to the source, the South African National Defence Force has had to rely on its reserve force because of deployments that were not factored into the initial budget.
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