Budget 2022

Mboweni on Moyane, markets and 'sweating' through his budget

SA Minister of Finance Tito Mboweni delivers his medium-term budget policy speech on October 24, 2018. ( RODGER BOSCH/AFP/Getty Images)
SA Minister of Finance Tito Mboweni delivers his medium-term budget policy speech on October 24, 2018. ( RODGER BOSCH/AFP/Getty Images)

Finance Minister Tito Mboweni quipped that he expected to see a "sweaty" picture of himself in the news on Wednesday with a headline that reads, 'Minister sweats through his budget'. 

Mboweni was addressing the media shortly after his mid-term budget speech in Cape Town, where there is presently a heatwave.

Mboweni touched on several matters during the briefing, including the reaction of the markets to his budget speech, SAA and suspended SARS commissioner Tom Moyane.

Reacting to the markets that had responded negatively to his speech, Mboweni said the markets may have "misread" the section in the speech about the impact of tightening monetary policy in the US on emerging market currencies. He said the markets could calm down on a second reading of the speech.

"Secondly, they (markets) were probably second-guessing the ratings agencies." Mboweni said some of his colleagues at National Treasury were in discussion with ratings agencies which would give a sense of "how they feel" about the mini budget.

"Also they (markets) might have been unhappy about the consolidated deficit number. Now that we have explained the situation, I suspect they will calm down. We will also benefit from you guys (media) by not throwing uncooked stories in the wire services," he said.

Answering a question about public sector wages, Mboweni said SA's labour laws (which he helped draft in the 90s) allowed for negotiations to settle disagreements in a "more responsible" way.

"People could keep jobs and live a decent life without the kind of compensation now - which is too high."

Mboweni said he was not suggesting retrenchments in the public service. "Every year people die, including those in the civil service. The question is 'do you replace them – or let it go?' It sounds bad. But it is the reality.

"People resign – hundreds of people resign from the civil service, the question is how to manage the process?"

On SARS Mboweni said the organisation has been weakened substantially - some of the investigative capacity of SARS have been removed or weakened. For example the investigative unit which focused on the rich people trying to avoid tax must now be rebuilt, he said.

The acting commissioner Mark Kingon has told Mboweni that some of SARS's past employees who have left might come back. But SARS is prepared to deliberately "go on our knees" and ask these employees to return to rebuild capacity at the organisation.

On Moyane's future at SARS, Mboweni said the law was inadvisedly changed so that the commissioner was appointed by the president rather than the finance minister.

"It was ill-advised, what they did, but I was not in the government at the time." 

He also went on to say that SAA was not a "holy cow".

"Those who travel on SAA are not the working class - we are better off making sure the trains of the working class  and Rea Vaya (buses) work properly," Mboweni said.

On his own recent appointment, Mboweni said he resisted as best he could, as he was doing well in the private sector.

"More than well paid, comfortable. I was free from Thursday to Monday. I had more time with my lambs, my dogs, chickens, cabbage and spinach," he said. 

But he pointed out President Cyril Ramaphosa was formerly the general secretary of the National Union of Mineworkers, and "out negotiated" him. He assured that he was prepared to do the work and was adjusting to life in government.

On his deputy, Mondli Gungubele, he joked that Gungubele had "too much energy".

He said he "laughs when a situation is difficult" and he hopes Gungubele did not "contract the laughter from the previous head of State".

He also clarified that he did not inherit the mini budget speech delivered today by former Finance Minister Nhlanhla Nene. "Some people say Nene wrote this speech long ago. That is rubbish," adding that the Treasury team worked on the speech just this Saturday.

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