Finance minister Enoch Godongwana said on Thursday SA cannot afford to have vaccine hesitancy if it is serious about prioritising saving the economy in future waves of Covid-19 infection.
He said getting more South Africans vaccinated would put the country in a better position to respond effectively to the economic impact brought about by the pandemic.
More than 23-million Covid-19 vaccines have been administered in SA since the rollout began in February.
The minister presented the medium-term budget policy statement (MTBPS) on Thursday, with a focus on growing the economy.
Here are five important highlights from his speech:
IS THE ECONOMY GROWING?
The minister said the eased lockdown restrictions had a positive influence in the quick economic growth in the first half of the year, saying it is expected to grow by 5.1% in 2021 from a 6.4% contraction in 2020.
“In the first half of 2021, the economy recovered more quickly than expected, reflecting less stringent Covid-19 restrictions, along with lower interest rates, support from strong international demand and higher commodity prices.”
“Over the next three years the growth in the economy is expected to average 1.7%, reflecting some structural weaknesses such as inadequate electricity supply.”
SORT OUT ESKOM AND BEITBRIDGE
The minister said improving infrastructure is vital for economic growth. This includes ensuring reliable and effective electricity supply by Eskom, maintaining railway services and border protection.
“Beitbridge typically processes about 900 commercial vehicles and 25,000 travellers during peak periods per day. It simply cannot cope. It is estimated the economic cost of the inefficiencies at Beitbridge, just to SA, amount to several billion rand per year.”
MORE MONEY TO FIGHT CRIME
Godongwana said Treasury has allocated additional funds to the military and to bolster their response to criminal activity around the country.
“The criminal activity we witnessed during the recent unrest reminds us that crime continues to be a blight on our society. It undermines confidence in our recovery and hinders our long-term economic development.”
#FEESMUSTFALL: MORE FREE HIGHER EDUCATION
The minister said the government will in the 2022 budget, allocate almost R74bn towards public employment programmes over the medium-term expenditure framework (MTEF) and increase funding for access to free higher education.
“In 2020/21 government spent R44.7bn in this function. This has been increased to R56.8bn in the current year. Over the 2022 MTEF, funding for higher education will total R158.8bn.”
46% OF COUNTRY ON SOCIAL GRANTS
Almost half of SA’s population are beneficiaries of government social grants, said the minister.
He said 9.5-million are beneficiaries of the R350 social relief of distress grant and 27.8-million are social grant recipients.
“This accounts for about 46% of our population. At the same time, the number of people working has declined, further underlining the critical flaws in our economy. Our total spending on social wages is also very high. This amount has grown from R860bn in 2018/19 to R1.1-trillion in 2021/22.”
Finance minister Enoch Godongwana presented the medium-term budget policy statement on Thursday.
Image: Esa Alexander/Sunday Times