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The Congress of South African Trade Unions (Cosatu) says a lot depends on Finance Minister Tito Mboweni’s Medium Term Budget Policy Statement (MTBPS) on Wednesday, and that the trade federation expects long-term commitments to cut spending. unnecessary and more. support to workers.
Cosatu said the MTBPS must address the damaging problems that stifle economic development, including the large scale and deepening levels of corruption and waste within the state.
The federation said that some of its expectations for MTBPS include:
- Universal income – Cosatu welcomed the extension of the R350 long-term unemployment benefit, however, said that it should be extended beyond three months and should be used as the basis for a basic income subsidy for the unemployed. Other relief measures should be envisaged, including the extension of the FIU TERS relief to affected workers.
- Procurement controls – The federation wants to speed up the draft law on public procurement and the introduction of the national online public procurement system.
- Stimulus – To save jobs, the government needs to inject new money into the economy to stimulate it, said Cosatu, adding that he awaits details on the infrastructure program announced by the government. “We expect the Treasury to abandon its austerity strategy because it is destined to depress demand and therefore cause an economic depression.”
- Loan guarantee system – Cosatu requested interventions in the Loan Guarantee Program, which seven months later, “shamefully”, only managed to approve 8% of its committed financing of 200,000 million rand.
- New tax to boost investment – The federation said the government should discourage cash hoarding and an investment strike by imposing a tax on those hoarding cash. The country also needs capital controls to protect the currency and deal with illicit financial flows.
- Repair of state companies – Cosatu said the government needs a solid proposal on how to fix and reverse state companies. “These state companies must be classified and be fast, we expect a solid and complete plan on how to rationalize and merge them. Many of these entities depend on the fiscus and are actually redundant and duplicate each other, while some do not have clearly defined functions, not to mention the fact that some of them are simply ineffective in implementing their mandates ”.
- No private consultants – The policy statement should address the problem of private consultants who take billions from municipalities, government departments and state entities every year without results, he said.
- The private sector should come to the party – Cosatu said that the private sector must fulfill its own commitments to urgently inject funds into the economy, in measures that will save and create jobs, support infrastructure and fragile economic sectors.
“The reality for South Africa is that we are where we are due to previous decisions made by policy makers and decision makers,” said Cosatu.
He said that the deepening socio-economic crisis currently affecting South Africa can be attributed in part to the wrong macroeconomic policy framework that has been in place over the years, especially since the beginning of the year.
The unemployment rate has continued to rise in 2020, a constant trend since the 2009 recession, reaching 50% in the second quarter of 2020 in real terms. This means that there are around 14 million unemployed, in which women and young people are the most affected by economic stagnation.
“This is the reason why the workers hope that the government will rise to the occasion and present an MTBPS that speaks and is in tune with the Economic Recovery and Reconstruction Plan presented by the president in parliament last week.
“What we cannot afford is the incoherence of government policy, where the National Treasury says one thing, while the president says another,” he said.
Read: The big problem in Mboweni’s budget plans
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