DA refusal to back budget the straw that breaks the GNU?

JOHANNESBURG - The consequences of the Democratic Alliance (DA)'s big gamble of refusing to budge or offer support to the proposed budget policy statement might be the straw that breaks the Government of National Unity (GNU)'s back.

This is according to some partners in the GNU coalition, who’ve claimed that the DA is being unfair and has politicised the budget.

The DA, which has complained of being treated like an observer or voting cattle by the African National Congress (ANC) in the GNU, has sent a list of demands it wants met before supporting the budget tabled by Finance Minister Enoch Gondogwana on Wednesday.

Members of Parliament will vote on the budget in the coming weeks.

In a letter to the ANC, which Eyewitness News has seen, the DA makes a series of demands, among them the reversal of the Expropriation Act, for the World Bank to be commissioned to take a full economic regulatory review of the state and for the Deputy Finance Minister Ashor Surapen, who is a DA member, to be given joint responsibilities to oversee comprehensive spending.

Some of the demands it made, which have irked not only those in the ANC, include the doing away with the Labour Relations Act.

DA insiders have defended the list, telling EWN it’s time for the ANC to recognise it’s no longer in the majority. "They must learn to share," said one member of Cabinet.

The party member, who spoke on condition of anonymity, said the ANC’s attempt to use the Economic Freedom Fighters (EFF) as a scarecrow would simply not work.

EFF, ACTIONSA APPROACH

Some in the ANC have been pondering over reaching out to the EFF’s Julius Malema in order to get through the impasse, however, Malema, like leaders of the uMkhonto weSizwe Party, which is the main opposition in Parliament, have been vehement in their opposition of any VAT increase, including the revised figure of 0.5 percentage points and not everyone in the former liberation movement believes he is an ideal partner to co-govern alongside.

"You cannot put yourself in a position worse off than where you already stand and going with the EFF would be doing that exactly," an ANC national executive committee member told EWN.

Several ANC leaders have also hit out at the DA, claiming it was never opposed to a VAT increase. This, however, has been largely dismissed by those in the blue party, who’ve argued that it should be a temporary measure that is applied over a three-year period.

Of those opposed to the EFF in the ANC, a minority government is still a viable option, where the party would rely on trade-offs to get through sticking policy matters like the budget.

This would mean the ANC reaches out to smaller parties, and at least one on the opposition benches, like ActionSA.

While ActionSA has previously said it would not work with the ANC, all of this changed, at least at local government level, following the 2024 general elections.

ActionSA has since established working relations with the ANC in Johannesburg and Tshwane, with its eyes now set on playing an even more critical role in Ekurhuleni.

Some argue that ActionSA and other smaller parties will be hard-pressed to accept what has been described as an unrealistic budget.

EWN understands that a formal attempt to reach out to ActionSA has taken place, though it seems to have received a lukewarm reception.

And while the ANC/DA spat plays itself out in public, there are voices within both organisations and the GNU who advocate for them to find one another. This with a view that this allows for the stability and continuity of government.

COALITION AGREEMENTS NOT UNCOMMON

Independent analyst, Lukhona Mguni, said that disagreements in coalitions weren’t uncommon.

He said it was also important to understand that while parties were compelled to work alongside each other in the coalitions, they would do so with their own supporters in mind.

"The DA has a clear constituency, and it may well hold on to each bargaining chip it has to try and fight for that contingency. But I think it's a bit opportunistic of them to ride issues of Expropriation Act, BELA, NHI on the budget because they ought to be dealing, in principle, with what is in front of them, it's the budget," he said.

Mnguni said the DA ideally should wait for the judicial review it had lodged against the Expropriation Act before setting off a parallel process in Cabinet.

He said that its view on VAT was legitimate, but this was hampered by the other issues it brought to the table in its objections to a VAT increase.

Mnguni believes the DA will simply not vote for the budget, leaving the ANC to think about the way forward.

The analyst said that he believes even the smaller GNU partners would object to the proposed fiscal framework.

'IT'S COLD OUTSIDE OF THE GNU'

Another analyst, Sanusha Naidu, said that the fallout over the budget would test the country’s Parliament and its ability to effectively play the role of oversight.

She said that several dynamics exist, including the fact that the parties locked in the disagreements over the budget proposal were all acting with next year’s local government elections in mind.

"Was the statement of intent negotiated with potential crisis, like the budget in mind?" she questioned.

She questioned the value of the agreement signed by GNU partners when the coalition was being put in place.

Naidu suggested that the roadblocks, stalemates and infractions were not taken into consideration by parties who quickly cobbled together a working agreement following last year’s general polls.

And while she marvels at seeing the DA and EFF equally opposing the VAT, albeit for different reasons, Naidu said she doesn’t believe the blue party would easily walk away from the GNU.

"It's cold outside of the GNU. You are not part of the decision-making, nor shaping of Parliament," she remarks.

Members of Parliament will have to engage on the proposed budget, with the option to accept or amend it.