Government apparently has no more money for R350 allowance

Henry

It appears that the government simply has no more money left to pay the special R350 emergency allowance to unemployed South Africans after March next year.

Now plans are being made hastily in the hope of picking a rabbit out of the hat.

According to media reports, pres. Cyril Ramaphosa, Enoch Godongwana, finance minister, and Lesetja Kganyago, president of the Reserve Bank, met last week about the growing public financial crisis.

The Sunday Times reported an increase in VAT by up to two percentage points and the strike of dozens of government programs were proposed at the meeting as possible solutions to the government’s self-imposed crisis.

The DA blames the Treasury’s over-optimistic projections in its February budget, weak economic growth, decades of economic mismanagement and poor economic policy choices.

Dr. Dion George, the DA’s spokesperson on finances, says that the opposition party has already expressed its concern that there was no provision in the budget of February this year for an extension of the emergency grant to April 2024.

“In response, the government announced that a revised social security model was being designed, followed by silence,” says George.

“This meeting could very well be part of a desperate scramble to find money to fund an extension of the grant and also to fill the massive gap between projected revenue and actual revenue.”

George says the fact remains that the government has run out of money and that he cannot finance items budgeted for in February.

‚ÄúThis is a direct result of failed economic policies and poor fiscal choices, such as positioning the government in the wrong place in the economy; a bloated cabinet; a proliferation of agencies that are nothing more than expensive employment agencies for ANC cadres; hopelessly bankrupt state-owned enterprises barely afloat; an energy crisis that significantly disrupted businesses’ ability to function; and systemic corruption that led to South Africa’s inclusion on the gray list and deterred local and foreign investment. The list goes on.

“It appears that the government is unable to make the difficult choices that are necessary to keep South Africa afloat.”

George says offering early retirement to public sector employees, cuts to visible policing and other essential services will make no difference to the country’s financial predicament.

“Something will have to change and the best solution for South Africa will be a new government that can start the process of turning around our battered economy, before it’s too late.”