Scopa chair declares contentious budgets 'the new normal'

Chair of parliament's standing committee on public accounts (Scopa), RISE Mzansi leader Songezo Zibi, advised South Africans to come to terms with contentious budgets that warrant postponements and more rigorous parliamentary engagement as the “new normal”.

Zibi was speaking at an RMB Global Markets Research and Sales post-budget breakfast on Thursday. Finance minister Enoch Godongwana tabled his budget in parliament on Wednesday, which included a proposal to raise VAT by a percentage point over two years to 16%.

Zibi said the tabling of the budget has previously taken place under the assumption that the proposals would be accepted and adopted smoothly because the ANC governed South Africa with no coalition partners for 30 years.

“However, there are instances where you have a political outcome that makes it impossible to assume that is going to be the case. It needs the support of other political parties to get things done and if that support is not there it becomes difficult. This is the new normal. We must internalise it and accept it. If we don't, we are deluding ourselves. This is going to be the case for budgets and it may be the case with various pieces of legislation in the future.”

Parliament's budget day activities originally took place in February, but pushback at cabinet level against Godongwana's proposal to raise VAT by two percentage points to 17% forced a postponement on the day.

In a separate post-budget breakfast on Thursday hosted by News24, Godongwana said the original VAT hike proposal was his idea and the second iteration of this proposal was chosen after consideration of all revenue alternatives at the disposal of the fiscus.

Zibi said parliament, including Scopa, would have 16 days from the tabling of the budget to consider the minister's proposals. Barring a rejection of the budget by the legislature, Godongwana's proposed VAT hikes will come into effect on May 1.

“Because of the powerful majority the ANC has always had, people would sleepwalk through the process because there was no drama. They must get used to the drama now.”

The committee procedures of the standing committee on appropriations, the select committee on appropriations, the standing committee on finance, the select committee on finance and Scopa, and MPs will have to engage the budget more rigorously than usual.

“In October there was an amendment to the February budget. There is every year. That amendment takes us a few months over so that this process can happen. So, there is not going to be a government shutdown, not anytime soon, even when it appears the consensus is taking too long.”

He suggested the minister table two appropriation bills: one including the items already agreed upon and another bill with the contentious items which account for R252bn in resources over the medium-term. This would allow the fiscus to fund areas where all parties are in agreement while cultivating genuine consensus on contentious areas.

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