The ANC wants the government of national unity (GNU) to enter into a formal agreement that will shape the national budget process.
This would help the government avoid another instance where the budget is postponed due to discord among GNU partners.
This is according to a report compiled by the party’s national executive committee (NEC) subcommittee on economic transformation, which is led by Mmamoloko Kubayi.
In a document dated August 1, the ANC promotes a more vigorous consultation mechanism by GNU partners before finalising the budget.
“Parties could negotiate an agreement on fiscal principles that could stand alone or form part of the coalition government’s agreement.
“Sufficient consultation is required on budget decisions beginning at an early stage in the process prior to the medium-term budget policy in the process,” according to the report.
Plans to raise VAT
The ANC was accused by its GNU partner, the DA, of sidelining other parties in the coalition government during the finalisation of this year’s national budget.
“The tabling of the budget was postponed at the eleventh hour, which left Finance Minister Enoch Godongwana with the headache of reworking the fiscal policy twice.
The DA was disgruntled over plans to raise value-added tax (VAT), as the party deemed it an anti-poor stance.
The ANC then resorted to working with parties outside the GNU to successfully pass the national budget.
“South Africa’s budget process was disrupted this year in part due to the difficulties associated with the GNU.
“The ANC should take active steps to seek to restore order and credibility to the budget process moving forward,” reads the document.
Austerity-driven budget
The ANC believes that an austerity-driven budget is not the only direction the country should pursue, as it would result in the “deterioration of services”.
They encourage expenditure reprioritisation, equitable and efficient tax systems, and pro-growth programmes.
“Where expenditure reviews are to be undertaken and spending cuts are needed, these cuts should be guided by a process of strategic prioritisation so that prioritised projects receive the funds they need and those that are not prioritised are closed down or downsized.”
The budget objectives include a spending review that aims to reduce waste and combat corruption.
Ensuring that citizens comply with tax laws and using the budget for public-private collaboration is also listed as the principle the budget is to follow.
The ANC posits that the budget ought to foster economic growth, elevate the quality of frontline services, and reduce the debt burden.