Let’s wrap up some of the top stories happening in South Africa this week.
FINANCE MINISTER DELIVERS 2024 BUDGET SPEECH – KEY HIGHLIGHTS
Finance Minister Godongwana delivered a budget juggling economic growth with social support amid tight finances.
Here are the Key Points:
Fiscal Outlook and Strategy:
– Budget deficit for 2023/24 estimated to worsen to 4.9% of GDP.
– Higher budget deficit leads to debt-service costs of R356 billion.
– Net reduction of R80.6 billion in non-interest expenditure over the medium term.
– Revenue revised up by R45.6 billion.
– Introduction of a reform of the Gold and Foreign Exchange Contingency Reserve Account (GFECRA).
Economic Growth and Risks:
– South Africa’s near-term growth estimated at 0.6% in 2023.
– Growth projected to average 1.6% between 2024 and 2026.
– Risks include electricity supply constraints, freight rail and port issues, and high sovereign credit risk.
Infrastructure Financing Reforms:
– Plans to invest more than R943 billion in public infrastructure.
– Amendments to the PPP regulatory framework for more efficient public-private partnerships.
– Introduction of new financing instruments such as infrastructure bonds and concessional loans.
Tax Proposals and Revenue Trends:
– Tax revenue for 2023/24 lower by R56.1 billion than estimated.
– Tax measures to raise R15 billion in 2024/25.
– Proposed increases in excise duties for alcohol products and tobacco.
– No increases to the general fuel levy for 2024/25.
Spending Plans and Allocations:
– Allocation of R25.7 billion for the education sector over the medium term.
– Additional funds for critical programs like the school nutrition program and early childhood development.
– Health allocated a total of R848 billion over the MTEF, including R27.3 billion for infrastructure.
– R765 billion allocated to the peace and security cluster, including funds for 10,000 new police recruits.
– Plans to invest more than R943 billion in public infrastructure.
Division of Revenue:
– R2.8 trillion, or 51.1% of total non-interest expenditures, allocated to provinces and municipalities.
– R531.7 billion allocated to local governments, and R2.3 trillion for provinces.
– Additional R105.5 billion allocated to provinces over the next three years for the 2023 public-service wage agreement.
Year Ahead and International Engagements:
– Hosting annual meetings of the New Development Bank.
– South Africa’s G20 presidency in 2025, with a focus on placing Africa’s development at the top of the agenda.
These key points highlight fiscal challenges, economic growth projections, infrastructure financing reforms, tax proposals, significant allocations in various sectors, and international engagements for the upcoming year.
CONSUMER INFLATION INCHES UP TO 5.3% IN JANUARY
After two consecutive months of decline, South Africa’s annual consumer inflation inched up to 5.3% in January from 5.1% in December.
The monthly change in the consumer price index (CPI) was 0.1% in January. Categories with the largest annual price increases were restaurants & hotels at 8.0%, food & non-alcoholic beverages at 7.2%, and health at 6.5%. While fuel prices saw a monthly decline of 5.2% in January, the annual rate for fuel increased from -2.5% in December to 3.3% in January, contributing to a rise in annual transport inflation to 4.6%.
THE END! E-TOLLS TO BE SCRAPPED FROM MARCH
Gauteng Premier Panyaza Lesufi has confirmed that the process of scrapping E-tolls will commence at the end of March 2024. The official delinking and shutdown of the gantries will mark the end of the controversial toll system. The national government has agreed to cover 70% of the outstanding R47 billion debt, with the Gauteng government responsible for the remaining 30%.
Finance Minister Enoch Godongwana previously announced the replacement of the toll scheme with a new financing mechanism for the Gauteng freeway upgrade debt. The move comes as a response to the low compliance rate, with only 10 to 12% of road users in Gauteng paying for E-tolls. Refund details for Gauteng motorists who have paid E-tolls were not specified.
SOUTH AFRICA’S HEALTH SECTOR TO RECEIVE R848 BILLION ALLOCATION WITH R1.4 BILLION FOR NHI
In the 2024 Budget Speech, Minister Enoch Godongwana announced an allocation of R848 billion for the health sector over the Medium Term Expenditure Framework.
The budget includes R1.4 billion directed towards the National Health Insurance (NHI) as a demonstration of the government’s commitment to the policy. Key focus areas for the allocation include addressing the 2023 wage agreement, infrastructure investment, and NHI grants.
The NHI allocation will support system-strengthening activities, such as building a national health information system, upgrading health facilities, and improving quality of care. Despite baseline reductions leading to slower growth than inflation, the sector aims for greater efficiency and improved management, with a focus on preventative care.
The recovery from COVID-19 disruptions, particularly in antiretroviral treatment and tuberculosis screening, remains a priority.
SOUTH AFRICA SETS GENERAL ELECTION DATE FOR 29 MAY 2024
President Cyril Ramaphosa has announced that South Africa will hold its General National and Provincial Elections on 29 May 2024. The decision, in line with electoral regulations, followed consultations with the Independent Electoral Commission (IEC) and a meeting with Provincial Premiers.
The election date coincides with the country’s celebration of 30 years of freedom and democracy. President Ramaphosa urged all eligible voters to actively participate in this significant and historic event on the democratic calendar.
MOTORISTS ROBBED DURING PEAK HOUR TRAFFIC ON M1 HIGHWAY IN JOBURG
Motorists on the M1 highway near the Crown interchange were robbed of their belongings during peak hour traffic on Tuesday morning. The criminals, allegedly illegal miners, targeted unsuspecting motorists, with reports indicating that a group of five armed men went from car to car, robbing occupants and causing car crashes as drivers tried to evade the robbers.
In response, the South African Police Service (SAPS) has increased the deployment of the Highway Patrol, SAPS Airwing, and Gauteng Flying Squad units to monitor and conduct regular patrols along the identified routes.
WESTERN CAPE BIG PLAN TO BECOMING LOAD SHEDDING-FREE PROVINCE – R7 BILLION TO BE SPENT OVER THE NEXT THREE YEARS
Western Cape Premier Alan Winde has announced a major plan to make the province the first in South Africa to become load shedding-free. The government is set to spend under R7 billion over the next three years to enhance energy resilience.
Load shedding has reportedly cost the Western Cape up to R43 million per day. Premier Winde highlighted the commitment to invest in initiatives that reduce the impact of load shedding on residents and businesses in the province.
In a release by WCGov it is stated “The Western Cape is estimated to have lost between R48.6 billion and R61.2 billion in real GDP since load shedding was first thrust upon us. In 2022, the real GDP lost to the Western Cape was estimated at R8.2 billion. The estimated cost of load shedding on the Western Cape’s economy, in stage 4, amounts to R43 million per day, and at higher stages, even more!”
MULTICHOICE AND DISNEY AFRICA EXTEND DISTRIBUTION DEAL UNTIL 2027
MultiChoice Group and Disney Africa have inked a multi-year distribution deal for Disney’s channel portfolio on DStv until 2027. The agreement includes channels like National Geographic, National Geographic Wild, Disney Channel, Disney Junior, ESPN, and ESPN2.
These channels will continue to be available on specific DStv packages for the next four years. The deal reflects a long-term relationship between the two companies and ensures the continued delivery of high-quality, premium kids, factual, and sports content to DStv viewers across the continent.
UNEMPLOYMENT RATE RISES TO 32.1% IN THE FOURTH QUARTER OF 2023
South Africa’s unemployment rate increased by 0.2% in the fourth quarter of 2023, reaching 32.1%, according to Statistics South Africa.
The Quarterly Labour Force Survey revealed a loss of 46,000 jobs during this period, pushing the number of unemployed individuals to 7.9 million. The formal sector saw a decline of 128,000 jobs, while the informal sector experienced an increase of 124,000 jobs. Industries contributing to the net employment decline included community and social services, construction, agriculture, trade, and manufacturing.
13-YEAR-OLD PRIMARY SCHOOL PUPIL FACES ATTEMPTED MURDER CHARGES AFTER SHOOTING SCHOOL PRINCIPAL
Germiston police have initiated a case of attempted murder against a 13-year-old boy who reportedly shot his school principal at Primrose Primary School.
The incident, which occurred during school hours in Germiston, east of Johannesburg, has left the 51-year-old principal hospitalized in intensive care. The young suspect, who allegedly used his father’s gun in the shooting, is scheduled to appear before the Germiston Magistrates Court.
The incident has sparked shock and raised concerns about violence in South African schools. Police are currently investigating the circumstances surrounding the shooting.
SIU TO INVESTIGATE HOME AFFAIRS AND PRASA
The Special Investigating Unit (SIU) is set to investigate allegations of serious maladministration in the Department of Home Affairs and the Passenger Rail Agency of South Africa (PRASA).
President Cyril Ramaphosa signed proclamations authorising the SIU to look into maladministration in the issuance of various permits and visas at Home Affairs, as well as improper or unlawful conduct related to the installation of T200 firewalls.
The SIU will also investigate corruption allegations linked to the awarding of tenders for the supply of trains at PRASA, as well as fraudulent liability claims and the employment of ghost employees.
CASE AGAINST CONVICTED MURDERER THABO BESTER & NANDIPHA MAGUDUMANA POSTPONED TO JUNE
The case against convicted murderer and rapist Thabo Bester, along with his partner Nandipha Magudumana, has been postponed to 5 June 2024. The couple, along with their co-accused, appeared briefly at the Bloemfontein High Court, facing charges of fraud, corruption, and aiding and abetting a convict of arson and violating a corpse.
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