Finance Minister Enoch Godongwana has warned of tough decisions come the medium-term budget policy statement on Wednesday, adding that there is a risk that the government will run out of money if no action is taken., which reported Godongwana’s sentiments towards the fiscus during his address at the Kgalema Motlanthe Foundation annual Drakensberg inclusive growth forum this weekend.
On Friday, Godongwana said in addition to localised problems, the Lady R scandal had also affected the economy as “everybody became scared that we’re likely to have secondary sanctions.” The National Treasury, therefore, recently proposed drastic steps to rein in spending as the government has run out of money and faces a debt trap – including a freeze on new public service jobs, stopping procurement contracts for all infrastructure projects, and keeping public servant salary increases in check.“Chaotic budget cuts” are not the answer to the shortfall between tax collections and government spending.
“The intensity of load-shedding has been more pronounced, logistics have become much more difficult … from the first quarter revenue … which means I don’t have money,” he said.