Cosatu: 2021 Budget is divorced from the reality for ordinary citizens

Cosatu’s Matthew Parks said South Africa not only had a debt crisis but was in its worst economic recession in 100 years.

FILE: Cosatu's Matthew Parks. Picture: @SACTWU/Twitter.

CAPE TOWN - Cosatu said the 2021 Budget failed to address the root cause of South Africa’s fiscal crisis and the loss of R150 billion a year in revenue due to corruption and wasteful expenditure.

The trades union federation told a joint meeting of Parliament’s Finance Committees that there were no consequences for such wrongdoing.

Cosatu has slated the 2021 Budget as business-friendly and divorced from the reality of ordinary South Africans.

Cosatu’s Matthew Parks said South Africa not only had a debt crisis but was in its worst economic recession in 100 years.

“The way the Budget fails dismally is not addressing the fundamental causes of the fiscal crisis – which is that we lose 10%, or R150 billion, to corruption and wasteful expenditure every year, there're no consequences.”

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“In the previous year’s budget Mpumalanga alone lost R12 billion on this basis. No consequence. We lose billions to tax and customs evasion and illicit outflows. We’re not sufficiently resourcing Sars to tackle it. We lose billions because we have to save the SOEs which are being run into the ground by incompetent management and corruption.

“And of course chair, the real issue – a stagnant economy with rising retrenchments and company closures. And for us, those are the things which the Budget needed to tackle”.

Parks said while Cosatu welcomed the withdrawal of plans to find R40 billion in taxes, the tax burden had increasingly shifted onto low- and middle-income earners.

“We do think there is some space to make sure the rich pay their fair share, whether income tax increases for the rich but particularly, inheritance and estate duties and levies on luxury imports.”

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