2012 Budget Speech by Minister of Finance Pravin Gordhan
Honourable speaker
It is my privilege to introduce the third budget of President Zuma’s administration. Mister President, you have given us a clear and historic challenge to “write a new story about South Africa – the story of how, working together, we drove back unemployment and reduced economic inequality and poverty.”
This budget has been crafted at a challenging but hopeful time. We have to say to our people that economic uncertainty will be with us for some time, yet we have a programme of economic change that can steadily roll back unemployment, poverty and inequality.
We have demonstrated excellent resilience during the post-2008 crisis. We now need to introduce a new dynamism among all South Africans.
It requires an extraordinary national effort from all role-players, committed not just to identifying the barriers to progress, not just to proposing solutions, but also working together, over the long haul.
Our new story, our period of transition, is about building modern infrastructure, a vibrant economy, a decent quality of life for all, reduced poverty, decent employment opportunities. It is a story that must be written by all of us. Not just by government. Not just by business. Not just by unions. By all of us, South Africans from all corners of this country.
The legacy of our past is not only that of difficulty and despair. We can draw pride from the celebration of the ANC’s centenary, and build on this past to get things done today. The idea of unity in action, working together to realise practical goals, must be revived. The idea of an active citizenry, drawn into motion by dedicated activists and inspired by a compelling vision of the future, has to be renewed.
Every one of the last hundred years has seen our nation overcome obstacles that seemed insurmountable. Some may have been beyond our control, the result of changes to the environment to which we were compelled to adjust. Some were the result of our failure to act, even when the solutions were known to us. Others were the unintended consequences of our own successes.
A towering leader of our movement, Walter Sisulu, wrote from his prison cell on Robben Island, “In a certain sense, the story of our struggle is a story of problems arising and problems being overcome. It is understandable that many of the problems should generate much controversy and emotion. However cool and detached we may strive to be in our analysis, the fact remains that we are deeply involved and interested parties and the solutions we adopt are solutions we ourselves have to implement.”
We will not turn away from our challenges. We must confront them boldly, and with hope. In harnessing all the resources at our disposal, we have to do more, with less; we have to work smarter and harder. South Africans must focus on our strengths and opportunities, to identify and activate the levers of economic and social change at our disposal.
Mister President you have given effect to the wisdom of Walter Sisulu; through the work of the Planning Commission this country now has a 20 year vision, through your initiative we now have a massive infrastructure programme also extending over 20 years, which will increase the growth and job creating potential of our economy.
Overview of the 2012 Budget
We remain steadfast in addressing the challenges of creating jobs, reducing poverty, building infrastructure and expanding our economy.
In brief, Mister Speaker, today’s budget advises the following:
- The global environment remains highly uncertain. While there are signs of a revival in the US economy, much of Europe is in recession, and significant financial risks cloud the global economic outlook.
- South Africa’s finances are in good health. A budget deficit of 4.6 percent of GDP is projected in 2012/13. We plan to reduce the deficit to 3 percent of GDP in 2014/15, and public debt will stabilise at about 38 percent of GDP.
- An expansion in infrastructure investment is one of the central priorities of the2012 Budget.
- Special emphasis is given to improving competitiveness in industry, investment in technology, encouragement of enterprise development and support for agriculture.
- Total spending will reach R1.1 trillion next year, representing some 32 percent of GDP.
- Education, health and social assistance will remain the largest categories of expenditure, sustaining and expanding the social wage over the MTEF period ahead. Investment in people is at the centre of our growth and development strategy.
- The budget continues to support job creation, with a particular focus on unemployed youth.
- The budget provides for personal income tax relief of R9.5 billion, with further measures to increase tax compliance.
- Measures are proposed to invigorate household savings.
- We will strengthen financial management in the public sector, pursue value for money with the greatest possible vigour and ensure that taxpayers’ money is well used.
- Fraud and corruption will be combatted through changes to procurement policies and practices and tough enforcement of the law.
Giving the budget practical effect cannot be a project of government alone. In Setswana, we say “Mabogo dinku a thebana” meaning “we have to work together to achieve more”. Government has supported the recovery from the 2008 recession, but as we expand infrastructure investment over the period ahead we have to see business investing in our future as well. Government has expanded social assistance to households over the past decade, but employment and economic growth have to be the main future drivers of income growth and poverty reduction. Government is responsible for developing effective municipalities and broadening access to services, but business, civil society and organised labour have to be partners in building cohesive communities and promoting social solidarity.
And so Mister Speaker, in tabling the 2012 Budget we have to say: this is what we undertake to do, not just as government, but as a nation. Our development requires every one of us to ask – what can I do for my country, my people, our future!
22 Feb 2012
To access the speech in full, please check
http://www.info.gov.za/speech/DynamicAction?pageid=461&sid=25270&tid=57402
2012 National Budget
http://www.treasury.gov.za/documents/national%20budget/2012/review/default.aspx