Cape Town – MPs have called on Finance Minister Tito Mboweni to review the decision to cut the budgets of departments and entities, saying this would have dire consequences for departments.
They said that it was intolerable that the government planned to reduce departments’ budgets to fund SAA’s R10.5 billion bailout.
MPs said it was a matter of serious concern that the bailouts of state-owned entities (SOEs) had taken up 10% of the budget.
In the Medium-Term Budget Policy Statement the national Treasury had indicated that government guarantees to SOEs amounted to more than R500bn.
Opposition MPs said it was not justifiable to fund SOEs when people who needed services from key departments were at the receiving end of poor service delivery.
But the ANC defended the budget, saying it was crafted under tough economic conditions to mitigate the impact of Covid-19.
This followed the government’s decision to cut billions of rand from several departments.
DA MP Dennis Ryder said there was no justification for cutting the budgets of the Department of Health and other key departments.
“What we see are slashes from government departments who should be receiving more funds,” said Ryder.
He said the country had been downgraded twice and the debt levels were uncontrollable.
Mmabatho Mokause of the EFF also slammed the budget, saying it was an austerity budget. The government should fight against the looting of Covid-19 funds, she added.
Fanie du Toit of the Freedom Front Plus said municipalities should be at the coalface of service delivery, but many of them were struggling.
“Local government is supposed to be the backbone of the economy. The number of unsustainable municipalities is increasing,” said Du Toit, adding that more funds were needed by municipalities.
Chairperson of the select committee on appropriations Dikeledi Mahlangu said the bill aimed at increasing revenue collection in municipalities should be expedited and tabled in Parliament.
A report released by national Treasury last week showed that municipalities were now owed R194bn, compared to R164bn in the first quarter of 2019/20.
Political Bureau