[WATCH LIVE] Budget Speech 2019
[LIVE BLOG] 'MPs, MPLs not getting salary increases' - Mboweni delivers Budget speech 2019
Finance Minister Tito Mboweni is delivering his first Budget speech in Parliament on Wednesday afternoon.
"Highlights of this Budget:
1. We are taking tough steps to fix the fiscal position and state-owned enterprises.
2. Our children are our future. Most of the spending goes to education, and we will
strengthen early childhood development and support higher education for the most
3. On land, we have set aside money to help our people buy their own houses, support
land reform, and transfer title deeds.
4. On electricity, we face tough choices on Eskom.
5. We are reprioritising resources towards the President’s infrastructure fund and away
from the wage bill."
"The infrastructure fund is a central pillar of the Budget and of reprioritisation. It will accelerate
R526 billion worth of on-budget projects by bringing in the private sector and development finance institutions. In several instances the private sector will design, build and operate key infrastructure assets.
"R625 million is allocated to the Development Bank of Southern Africa, the Government Technical Advisory Centre and the Presidential Infrastructure Coordinating Commission to strengthen project preparation in this context and on a speeded up basis, projects based on rural roads and water will be prioritised."
"In the fight against poverty and inequality, Government has allocated R567 billion for social
grant payments. In 2019, the grant values will increase as follows:
• R80 increase for old age, disability, war veterans and care dependency grants.
• R40 increase for the foster care grant to R1 000.
• The child support grant will increase to R420 in April and to R430 in October."
"Fully subsidised education and training for the poor is government’s flagship higher education
intervention. Over the medium term government will spend R111.2 billion to ensure that 2.8 million deserving students from poor and working class families obtain their qualifications at universities and TVET colleges."
During this past financial year, total guarantee utilisation increased by R51.1 billion:
1. Eskom used an additional R50 billion of its R350 billion guarantee in 2018/19.
2. Denel was granted a further R1 billion guarantee.
3. SAA guaranteed debt increased by R6.2 billion.
4. My congratulations to the Land Bank, which repaid debt, reducing government’s
guarantee exposure. Other entities reduced their guarantees, unfortunately in some
cases as a result of appropriations.
"The SOEs pose very serious risks to the fiscal framework. Funding requests from SAA, SABC,
Denel, Eskom and other financially challenged state-owned enterprises have increased, with
several requesting state support just to continue operating. Isn’t it about time the country asks
the question: do we still need these enterprises? If we do, can we manage them better? If we
don’t need them, what should we do?"
And now for sin taxes...
"1. The excise duty on a can of beer goes up by 12 cents to R1.74
2. A 750ml bottle of wine will have an excise duty of R3.15, which is 22 cents more
3. The duty on a 750ml bottle of sparkling wine goes up by 84 cents to R10.16
4. The duty on a bottle of whiskey will go up by R4.54 to R65.84
5. A pack of 20 cigarettes goes up by R1.14 cents to R16.66
6. The excise duty on a typical cigar will go up by about 64 cents to R7.80
7. There will be no change to the excise duty on sorghum beer as a retirment present to Honourable Mangosuthu Buthelezi (MPs laugh and applause).
These are the recommendations:
1. A new Commissioner will be appointed in the coming weeks.
2. A new Illicit Economy Unit launched in August 2018 will fight the trade in illicit cigarettes
3. The large business unit was a major source of tax collection, and its skill was renowned.
This unit will be reintroduced and will be formally launched in early April 2019.
4. SARS is strengthening its IT team and its IT systems and this is crucial for our tax
5. Information sharing agreements with allies will help fight cross-border tax evasion
"In October, during the 2018 Medium Term Budget Policy Statement (MTBPS), I outlined our main budget fiscal outlook. At that time, I projected that in 2018/19 tax revenue would be R1.3 trillion and that spending would be about R1.5 trillion. That left us with a budget deficit of R215 billion, or 4.3 per cent of GDP."
Mboweni takes us to church for a second...
"How do we make this renewal a reality? I turned to the Good Book for guidance.
In Zechariah 8 verse 12 it says:
'For the seed shall be prosperous; the vine shall give her fruit, and the ground shall give
her increase, and the heavens shall give their due; and I will cause the remnant of this
people to possess all these things.'"