SA businesses react to Budget Speech

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There have been mixed reactions to Finance Minister Malusi Gigaba’s budget speech with some citing concerns over the increase in VAT and taxes on alcohol and tobacco. Some say the minister covered all aspects, while others feel that Gigaba’s budget lacked details in certain areas.

Gigaba’s budget speech comes less than a week after political transition in the country. The current political climate has instilled a sense of hope and it is likely to influence the country’s economic outlook.

However, government is still facing a revenue shortfall of R 48, 2 billion.  This has forced government to increase Value Added Tax (VAT).

Students at the Nelson Mandela University in Port Elizabeth voiced their view about the budget speech, saying the VAT increase and implementation of free education are still a concern for the poor.

“The issue is the implementation, and it’s already an issue in our institutions right now, because we have a lot of students who are coming in but do not have money for allowances, for food and transport,” says one of the students.

Border Kei Chamber of Business in the Eastern Cape has described Gigaba’s budget speech as well-balanced.

Chief Executive Officer of Border Kei Business, Les Holbrock, says they welcome the R1.4 billion allocated to support Small Medium Micro Enterprises.

“We think it’s a good idea that the  state-owned entities are going to be reviewed and some of the assets are  going to be turned into capital assets and to help fund businesses. It’s a good idea to sell of unused, good consertion for economic zones. We do appreciate that additional funding has been made available. Agriculture, a good grant for small-scale farmers. We  think that the farmers themselves do need support. However, we think that small-scale  farmers need to become accountable for the money that is being given.”

Chairperson of the Black Management Forum in the Nelson Mandela Bay, Glenda Perumal, says the budget did not talk to the ordinary people of the country.

“The men on the street are not interested on the deficit; they are interested in walking to a shop and paying less for the essentials. In terms of unemployment where we cut, save money,  cut fruitless expenditure on government  department and that money can be used to create opportunities.”

Meanwhile, the South African Students Congress (Sasco) says a lion’s share of the R57 billion for free Higher Education should be allocated to historically disadvantaged institutions.

Sasco president Avela Mjajuba, says students at these institutions are struggling and some of them have dropped out before they graduate due to lack of funds.

Mjajuba says he is hoping that the Education Minister Dr Hlengiwe Mkhize will give clarity on how the money will be spent.

“We are concerned that the amount allocated does not speak in terms of saying what is it that must happen. We had hoped that the minister was going to cover that in relation to student debt clearances. So, we are  saying the  education minister must prioritize the working class because this pronouncement is said to uplift the poor and the  working class and make sure that poor and working class do access institutions of higher learning. So, this money  must be prioritized to infrastructural development in the historically black institutions and TVET colleges.”

Citizens say they are hopeful that the various departments will use their allocated budgets effectively.

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