R1 trillion budget expected

2012-02-22 07:18

Finance Minister Pravin Gordhan will present the government’s 2012 budget today, amid speculation it would reach more than a trillion rand due to a planned infrastructure rollout.

“The question remains whether government will be able to spend this trillion rand in such a way that we get value,” Congress of the People spokesperson Nick Koornhof said yesterday.

Gordhan will probably forecast a shortfall of 5.4% of gross domestic product in the year through March 2013, according to the median estimate of 10 economists surveyed by business news agency Bloomberg.

Gordhan estimated a deficit of 5.2% in October.

In his state of the nation address last week, President Jacob Zuma pledged to invest in infrastructure, without introducing new taxes or increasing the forecast deficit of 5.2%.

The DA proposed partially privatising state enterprises to boost infrastructure spending to 10% of the national budget.

Spokesperson Tim Harris said the government should follow the example of Brazil, which this month raised about R70 billion by privatising operations at its three biggest state-owned airports.

South Africa’s infrastructure drive could be boosted by R55 billion a year by partially listing state-owned enterprises and selling off their existing assets and investing the proceeds into building projects, Harris said.

Trade union Solidarity agreed this year’s budget was likely to break the trillion rand level for the first time in the country’s history.

The union wanted, among others, relief for taxpayers and clear signs of fiscal responsibility.

Mark Weinberg of the Alternative Information Development Centre, and is representing a number of other civil society organisations, urged higher taxes for the rich.

The budget speech would be broadcast on national TV at 2pm.

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