‘There is a problem’: SACP says Finance Minister Enoch Godongwana never consulted alliance partners on Budget

The SA Communist Party (SACP) says even though extensive negotiations and consultations were held with parties in the Government of National Unity, the SACP was not consulted around the National Budget.

IOL reported on Wednesday that Finance Minister Enoch Godongwana said Cabinet’s future talks about a 2% increase in VAT, a proposal by the government that was so politically sensitive it caused the National Budget to be postponed, cannot take place without considering what it is going to be replaced with.

Speaking at a briefing after the postponement of the Budget on Wednesday until March 12, he said that given the funding and fiscal challenges facing the country, the Cabinet will need to decide how the country is going to come up with the additional funding required, either through increased borrowings, for which there was little scope, further government spending cuts, or increased taxation.

On Wednesday night, in a panel discussion on broadcaster Newzroom Afrika Alex Mashilo said the SACP was not involved in any of the minister’s consultations around the national purse.

“The SACP is in alliance with the ANC and Cosatu. There is a problem there. You cannot have the type of consultation we have read in the media between the ANC, or the minister of finance and the DA and there has been no consultation within our alliance.," said Mashilo.

“That is a problem. Now, when you look at the responses of these political parties starting with the DA which seems to have been relied up upon, on the basis that if it brings its 21 percent, then there is 60 percent and that could undermine minority parties in the government – that DA proves to be unreliable to a policy agenda that the ANC thought they (DA) would be with them.”

The Democratic Alliance (DA) on Wednesday took the lead in voicing its opposition to the proposed 2% increase in VAT that was contained in the Budget proposals. However, Minister in The Presidency Khumbudzo Ntshaveni said the delay was not due to the opposition to tax proposals by any one party, but was rather “a collective decision by the Cabinet.”

She said that it was “completely wrong” to think that the DA had forced the postponement, adding that even ANC ministers opposed the proposed increase.

Some political parties claimed that they had only known of the tax increase on Wednesday morning, hours ahead of the planned tabling of the Budget in Parliament. However, Godongwana said he had indicated to parties two weeks ago that tax increases were imminent, although in this meeting he had not disclosed the extent of the increase in VAT.

Mashilo said the DA continue continues to push an “anti-worker” agenda and there is possibility of confrontation in the coming days.

“The DA is going to be caught with serious surprises. Its macro-economic policies and budget expectations are anti-workers and what it has tried to do is to elevate the point that we and other political parties have elevated – on the VAT while behind the scenes they are driving a serious anti-worker agenda," he said.

“They have unleashed a machinery against themselves which they are about to see in the coming weeks."

IOL