By Lehlohonolo Lehana.
The African National Congress (ANC) Secretary General Fikile Mbalula says party welcomes the formal withdrawal of the proposed 0.5% point Value Added Tax increase and looks forward to the revised budget.
The ANC was briefing the media on Wednesday at Albert Luthuli House in Johannesburg, on matters of national interest.
Mbalula, said the outcome of the VAT increase reversal was not a legal victory for any party, but a decisive political resolution rooted in consultation.
This is after the Democratic Alliance (DA) filed an urgent application with the Western Cape High Court that the pending VAT increase should be halted.
In its order, the High Court set aside the adoption of the fiscal framework and suspended the 0.5 % VAT increase.
As finance minister Enoch Godongwana is expected to deliver his revised budget on the 21st of May, Mbalula said the ANC hopes for a budget that protects vulnerable members of society, and address the needs of the poor.
“It has to be a people’s budget, a budget that does not retreat into austerity, nor sacrifice long-term transformation at the altar of technical compliance. Instead, it balances pro-growth policy with pro-poor spending, rooted in the developmental ethos of the Freedom Charter and the democratic values of the Constitution,” said Mbalula.
Mbalula further stated that the ANC will continue to engage with political parties in the Government of National Unity (GNU), including the Democratic Alliance (DA), on the revised fiscal framework.
“Our goal is to sustain the work that we started after the initial Fiscal Framework was tabled in Parliament and build consensus around a progressive medium-term fiscal strategy that takes us out of the austerity cycle into a comprehensive Growth Agenda,” he said.
Mbalula also weighed in and rejected calls for Godongwana’s removal.
He referred to the short-lived appointment of Des Van Rooyen as finance minister during Jacob Zuma’s presidency.
“We are not going to have a situation, as much as it is the president’s prerogative, a weekend special again. We are stabilising the country and at the same time, we will take cogent and informed decisions.
“It can’t be when we are faced with a big challenge like the budget impasse, the first resolution is to dismiss the minister, “he said.
ANC chair of subcommittee on economic transformation Zuko Godlimpi said, the budget impasse had come with some positives, as South Africans have now a better understanding of how the budget process works.
“So, there are positives to this and there are negatives of course because it delayed us, but it’s good that everyone now knows about the budget process and they can actually express themselves. So, it’s a positive note,” he said.
“Many South Africans didn’t know that actually when the minister of finance speaks in February that’s not the final budget — there’s a longer process that follows. So, it’s a good thing; everyone has learnt out of this. We will have to follow through with that consultation so that we don’t get ourselves into this situation [again].”