Budget 'as usual'There were hopes that the events of Polokwane would have affected the way that government plans to spend its income for the next year.
There was a belief that the crises of unemployment, inequality and poverty would finally be reflected in government's spending plans.
And when president Thabo Mbeki introduced the year as “business unusualâ€, there was more expectation that the budget would also be “unusualâ€.
But it was not to be. “The focus is on the right issues,†responded Cosatu general secretary, Zwelinzima Vavi to Manuel's budget.
It tackled job creation and support for the goverment's new industrial strategy, “but the scale is not good enough.
The boldness is lacking,†said Vavi.Unemployment statistics show that:* one out of every two adults between the ages of 15 and 24 is unemployed. * Two thirds of the unemployed are between 15 and 34 years old.
They cannot find employment because they lack the skills and "they cannot continue their education as higher education is very expensive" says the People's Budget Coalition (PBC), a grouping of the SA Council of Churches, Cosatu and other civil society organisations.
South Africa is one of the most unequal countries in the world and inequality is increasing. Almost half of the country's population lives in poverty.
The Eastern Cape has the highest percentage of poor people followed by Limpopo and Free State. In 2006 the richest 10% of the population owned 55,9% of the wealth of the country.
The poorest 10% owned just 0,6% of the wealth of the country.These are the reasons why Vavi called for boldness.
These are the bold moves that the PBC wanted to see in the Budget* the introduction of the Basic Income Grant OR* at least a programme to increase the child support grant to 18 years * a lifting of the social grants to above the inflation rate because of the high cost of food* government abandoning the Pebble-Bed Modular Reactor (PBMR) and instead switching these massive allocations into renewable energy and other energy forms* a reduction in VAT to 13% and the removal of VAT on electricity* government using its surplus to fund massive social and economic development.
How we rate the budget:
Thumbs up to:
BUT…..
Increasing child grant age to 15 by 2009
What about those children above 15 years and adults with no jobs.We still want a Basic Income Grant of R100 per month for everyone.
Increasing social grants
* 8% increases (7,5% for child grants) are below the current inflation rate of 8,8% and way below the current food inflation rate of 13,4%. The poor will get poorer!
Lowering qualifying age for old age pension (OAP) to 60 for men by 2010.* 2008 – 63 years* 2009 – 61 years* 2010 – 60 years.
All those old enough and earning less than R2140 per month can apply for old age pension
Check what it was before from Black Sash????
Education:More money allocated to education especially to early childhood development, Grade R learners, school feeding schemes
There are thousands of unemployed school leavers who are unable to go into higher education because it is beyond their reach.
Public service:Government commitment to employ more public servants
Health:* 25000 more posts to be filled by 2010* conditional grants for HIV/Aids will increase* higher pay for nurses* more money for MDR and XDR TB
Increase in income threshold before you have to pay tax
Housing:Additional R6bn for housing, water and general infrastructure
Not enough to deal with massive housing backlog estimated to cost R50bn
More money allocated to expanded public works programmes
Need to address short term nature of these projects
Billions to fund the government's new industrial strategy
Tax incentives to employers for:* longer term apprenticeships and * if they pay for their staff members' families education
Crime and policingMore police, more prosecutors, judges and magistrates, more police stations, more prison spaces
Infrastructure investmentExtra R17bn for housing, provincial and local govt, water, sport, recreation, transport.More resources for free basic services to poor households.
Public tranport gets a big boost over the next three years.So too does Transnet – most of it goes to rail; also for ports and construction of liquid fuels pipeline bet Dbn and Gauteng.
Thumbs down to:
Because
Government running a budget surplus
Government should rather use the surplus to fund massive social and economic development.
Reduction of company tax by 1%
Government will lose about R5bn in revenue.
What tax you will pay from March 2008 to February 28 2009
Income per year
Income per month
Income per week
From March 2008 – Feb 28 2009 you will pay this tax
LESS THAN R46 000
Less than R3 833.33
Less than R885.30
You will pay no tax at all
More than R46 000 but less than R120 000
More than R3833.33 but less than R10000
More than R885.30 but less than R2309.47
You will pay R540 less to the tax man per year
More than R120 000 but less than R150000
More than R10000 but less than R12500
You will pay R1065 less to the tax man per year
More than R150 000 but less than R200000
More than R12500 but less thanR16666.67
You will pay R1205 less to the tax man per year
Sources
Numsa News