A Quietly Competent Fiscal Framework

The speech below was delivered by Dr Mark Burke during the Consideration of 2026 Fiscal Framework and Revenue Proposals:

Madam Speaker: My call on the Minister before tabling the fiscal framework was to make budgets boring again. I’m happy to say that the minister has largely done so.

This framework is not only boring: it’s quietly competent.

It includes no VAT increases, and tax brackets are far less creepy.

We are voting for a framework that increases tax thresholds – some of which have been frozen under the ANC for decades.

We are voting for a framework that focuses on debt stabilisation.

These are noble goals. . . and when the framework was delivered in February, you deserved the congratulations you received.

But we are no longer in February. March has changed the world. Hormuz rolls off the tongue almost as easily as Hermanus.

Petrol price increases will carve holes into family budgets.

Bond yields are threatening to blow up our debt stabilisation path.

And we’ve gone from hoping for interest rate cuts this year to worrying about rate rises.

In the short time we’ve had to pass this fiscal framework – its underlying assumptions have radically altered.

The mild optimism we had in February is leaking like it’swater in a City of Johannesburg pipeline.

And so I come to this not to celebrate this fiscal framework but to bury and old hatchet and to pass it. And to deliver a warning: beware the ides of next March, for next year’s budget may not be nearly as boring.

Global events threaten our economy and our households – and we are not ready.
Decades of deficits and debt has left us with very little fiscal room to respond.

We should have used the time since the last global shock to radically reform.
Instead, like a MetroRail train, we’ve moved too slowly, we’ve sent the wrong signals and we’ve spent as much time getting looted as we have fixing things.

I fear we’ve left this all very late.

What kind of a hole is the global conflict driving into this fiscal framework, Honourable Minister?

Whatever the size might be – I need to issue an early warning. Unlike a pothole in an ANC municipality – do not expect taxpayers to fill it.

We have 11 months to fundamentally shift expenditure.
Do not tell us next year that SETAs can’t be drastically reformed or cut overnight. You have almost a year’s notice.

Do not tell us that spending reviews will take more time. This is the “more time” part.

National Treasury and the Presidency need to act now. It cannot allow itself to be a looting enabler like an ActionSAmayor.

Don’t tell us next year that you still haven’t figured out how to extend the ghost worker audit beyond National and Provincial government to local government and state entities.

Lack of time – is not a valid excuse. For we know that lack of time is often a lie – it’s lack of political will that’s the problem.

Madam Speaker, I hope that my speech does not age well. I hope that next year’s budget does not include revenue shortfalls. But I fear that even if I am wrong about next year – I will be wrong about the timing, but not the event.

Honourable Minister, this warning might be uncomfortable – but unlike the SACP’s grievances – the ANC cannot simply ignore it.

We are one global downturn away from moving from boring budgets to extremely difficult ones.

We can wait – and face the music later – or we can prepare now before it’s too late.