OPINION: What the 2019 Budget means for education, child grants and your family’s wellbeing

“The fiscal framework proposed in this budget bails out Eskom but cuts spending on education, health care and housing.”
“The fiscal framework proposed in this budget bails out Eskom but cuts spending on education, health care and housing.”

On 20 February, Finance Minister Tito Mboweni delivered the much-anticipated budget speech for 2019. He said schools across South Africa would be receiving much-needed funding – good to hear after President Cyril Ramaphosa promised a tablet per pupil within the next 6 years in his State Of the Nation Address just two weeks before. Mr Mboweni said:

“Over R30 billion is allocated to build new schools and maintain schooling infrastructure. An additional R2.8 billion is added to the School Infrastructure Backlogs grant to replace pit latrines at over 2,400 schools.”

But while we welcome the promises made for our families and similarly the recognition that the country is in a tight financial position, the Budget Justice Coalition (BJC) suggests the apparent commitment to addressing the people’s constitutional rights is more rhetoric than reality:

“The fiscal framework proposed in this budget bails out Eskom but cuts spending on education, health care and housing.” 

Gaps in the 2019 budget 

In a media statement, the BJC noted the following gaps in the 2019 budget as far as your family's wellbeing is concerned: 

  • President Ramaphosa’s pledge in SONA that funding will be provided in the budget to ensure the implementation of the outcomes of the Gender Summit – the BJC can find no new funds allocated for this purpose and the Budget Review does not even mention gender inequality nor the Summit.
  • The Finance Minister says that the eradication of pit latrines at schools will be prioritised and yet funding for school infrastructure as a whole has been reduced for the second year in a row.
  • The Treasury says it is committed to assisting in the fight against corruption and yet no new measures were announced to ensure the blacklisting of corrupt government officials and private actors that facilitated state capture.
  • The National Development Plan talks about reducing the cost of living on the poorest in society, and yet the budget announces another round of delays to the extension of the child support grant to orphans, more increases to the fuel price, and below inflation increases to social grants, including the old age pension.

Let's take a closer look at three of the areas highlighted by the BJC.

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"The BJC acknowledges the focus on school infrastructure and particularly the commitment the Minister of Finance has made to addressing the sanitation crisis by allocating R2 billion to the School Infrastructure Backlogs Grant (SIBG) in order to eradicate pit latrines. We note, however, that spending on school infrastructure has been reduced in real terms for the third consecutive year. We therefore question if the renewed commitment is more rhetoric than reality.

"Additionally, it is important to note that there have been several commitments made both in the 2018 Medium Term Budget Policy Statement (MTBPS) as well as in the 2019 State of the Nation Address (SONA) regarding the plans to improve access to basic education services.

"These include the expansion of the Early Grade Reading Study (EGRS), the roll-out of compulsory two-year access to Early Childhood Development (ECD) services for all children as well as the provision for sanitary towels to be made available at all schools across the country.

"While we welcome these commitments to improve the sector, we are also very concerned that no budgetary allocations were included in the Budget. This to us signals the use of political strategy ahead of the elections to making grand claims that the administration has no intention of realising."

Social development 

"Social security grants have failed to keep pace with inflation despite the strong recent recommendation of the UN Committee on Economic Social and Cultural Rights that the Child Support Grant be increased at least in line with the Food Poverty Line, which would constitute a 32% increase. Absolutely no reference was made to this binding recommendation.

"No reference has been made to the indexing of grants to a Decent Standard of Living, despite repeated calls to this extent, nor to the introduction of a universal Basic Income Grant.

"Furthermore, reference was made to the process of drafting a new Social Development Bill despite the failure of government to raise this in the NEDLAC, raising questions of the state’s good faith in this process.

"The continued negative impact of VAT on the basket of goods affordable to the poor will only be exacerbated by these below-inflation increases. We further note with concern that food prices will likely be impacted as a knock-on effect as a result of the impending fuel levy increases, and the carbon tax forecast for June 2019 will also likely increase fuel prices and the cost of living.

"Given this, the delay in implementing the R1 Billion in extended child support grants, which is meant to assist orphans, does not augur well for the most vulnerable in our society. We note that it will also affect grandmothers, who are often the caregivers."

Also read: How to get child support grants in South Africa

Human settlements 

"Human settlements has seen a great deal of budget reduction over the years in real terms. In the 2019 budget, there is a baseline (initial allocation derived from previous year’s forward estimates) reduction on the Human Settlements Development Grant of R1 billion, R2 billion and R3 billion over the medium term.

"While we acknowledge that intention for the government to continue to place emphasis on 'supporting people to own their own homes', efforts to increase home ownership should focus on the provision of housing subsidies for low-income earners, increased access to mortgages for middle-income earners and title deeds registration.

During the 2018/19 Medium Term Budget Policy Statement, the Title Deeds Restoration Grant was phased out although there is still a backlog in the issuing of title deeds for beneficiaries of state houses. The targets for title deeds registration has as a result been reduced from 170 240 in 2018/19 to 159 687 in 2019/20.

"We note that the number of subsidy units completed per year are being reduced over the medium term from 98 152, 83 292 to 80 473. R14.7 billion over the two outer years has been reprioritised to create two new conditional grants for informal settlements. The focus on informal settlement upgrades must not translate to neglect on the provision of state (RDP) houses.

"Although it is imperative that there be assistance provided to those who are able to access financial support to own houses, failure to provide RDP houses for those who cannot afford will shatter all the hope of ever owning a house for the extremely disadvantaged and runs counter to the Freedom Charter’s goal to provide decent housing for all.

"We note, however, that the announcement in the State of the Nation Address of the introduction of the Human Settlements Development Bank is a positive step towards supporting home ownership."

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Gender budgeting 

"The Budget Justice Coalition recognises that the budget is a major tool for transforming gender relations and is committed to the realisation of an intersectional feminist budget and budget process. We were encouraged by commitments made at the recent presidential Gender Summit in this regard. However, there is no mention of gender in the budget review and we can find no additional funds allocated to fulfill the President’s promise. We remind the government that the realisation of substantive equality is not an option but a duty placed upon the state by our Constitution, and do not take this step back lightly.

"Gender-based violence continues to be a widespread problem in South Africa, however there was no mention of it in the budget speech. The coalition was hoping that allocations of extra funds for sexual offences support services, including dedicated sexual offences courts, but it appears as if there is no real will to make this a reality."

From the notes made by the BJC we can deduce that while many promises have been made in both SONA as well as the budget speech, they appear to be empty promises, for the most part at least. It seems more like we're being sold dreams than given a level of transparency we deserve when it comes to the budget and what can actually be done in reality to better improve people’s lives.

"So while the BJC welcomes all the above, we wonder how likely it is that these grand proclamations will be fulfilled and to what degree, if at all."

Source: The Budget Justice Coalition 

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