South African Students Congress

SASCO Reaction to 2015 budget

2 March 2015

The South African Student's Congress notes the first Budget Speech by the Minister of Finance, Mr Nhlanhla Nene. We also note the tabling of the 2015 Budget Review, Division of Revenue Bill, Appropriation Bill, and the Estimates of National Expenditure. SASCO will do a comprehensive study of each of these and issue a detailed response at a later stage.

On the 2015 Budget speech:

SASCO remains deeply concerned with the nature and tone of the 2015 budget. The Minister's silence on the triple crisis of unemployment, poverty and inequality facing South Africa is rather worrying.

This year's budget, similar to that of last year, shows that the ANC's resolution on radical economic transformation is not taken seriously by the National Treasury. The ANCs January 8th Statement called for radical economic transformation as called for by the Freedom Chatter, however this was not even mentioned in the budget.

On Education:

We welcome the R640 billion allocated to basic education during the next three years. We also welcome the pronouncement on support to teacher training amounting to R3.1 billion which will be awarded in Funza Lushaka bursaries over the next three years amongst other allocations made in the Basic Education Sector.

On funding for post-school education, the projected R2.7 billion increase in student funding under the National Student Financial Aids scheme over the next two years is noted. In as much as we welcome this projected increase, we believe that it is not enough to address the plight of poor students who continue to face financial exclusions on a yearly basis.

The Minister pronounced that the National Student Financial Aid Scheme is projected to spend R11.9 billion in 2017/18, this however gives no indication of a move towards free education.

We believe that South Africa will never move forward until government can provide quality free education for all.

On Health & Social Protection

We applaud the strides that have been made in the fight against HIV/AIDS and the roll-out of ARVs. However government seems to be dragging its feet on the roll-out of the National Health Insurance.

We note that the NHI is hardly mentioned at all in the main sections of the budgets and is only mentioned in the four page Peoples Guide, which states that, "The Department of Health is in the fourth year of the phased 15-year rollout of National Health Insurance, and pilot activities are already underway in 11 districts." In the main speech, the Minister states that a "discussion paper on financing options will be released shortly by the National Treasury to accompany the NHI white paper."

To us, the lack of detail on this matter is an indication the National Treasury does not view the roll-out of the NHI as a priority. The lack of information on this long standing issue was rather disappointing. Especially considering that it is the working class and the poor who are mostly affected by the challenges within the public healthcare system.

We welcome the additional R7.1 billion on the Social Development vote as social grants play an important role in protecting the poorest households against poverty. However, the announcement of the long-outstanding discussion paper on social security reform with no indication of time frames is concerning as we believe that this matter deserves urgent attention.

We must also note that the social grants increases fall below-inflation. This is a serious course for concern.

On Tax Policy:

The 80c per litre fuel increase and the electricity levy increase over 30% are a course for concern. We appreciate the fact that VAT has not increased as that would hit the poor and working class the hardest.

We welcome the increase of R1 105 a month for those earning over R1.5 million a year. However, we believe that the 1% increase in income tax for those earning above R181 00 is problematic. Although this is introduced as a step towards progressive taxation, the increases should only focus on the rich.

It is of concern that the Minister could not announce decisive measures to increase corporate tax, this means capital will continue to benefit unabated from exorbitant profits which they don't even invest in our country. An increase in corporate tax would also make funds available for even higher increases in the allocation for student funding.

We mostly disappointed yet again that there was no pronouncement on our call for the introduction of an Education Tax, focused on the super-rich with the intention of introducing Free Education.

Issues by the NEC of SASCO

For me info contact

Thabo Moloja, SASCO Deputy President on 071 875 2224

Or

Luzuko Buku, SASCO Secretary General on 071 879 3258