DAAN STEENKAMP: Excessive public sector wage growth is the problem, not too large a bureaucracy
Cuts have been made in many areas, but spending on wages, grants and debt has risen
After more than a decade of government budget deficits, and attempts at austerity, the government has failed to consolidate its financial position.
There have been spending cuts in many areas of the government, but spending on wages, grants and debt have increased and the economy has been much weaker than expected. Research by the Wits Public Economy Project (PEP) shows that the National Treasury has been overly optimistic in its assessment of the outlook for the economy and fiscus, and that spending cuts have led to a reduction in the quality and quantity of government services. Past attempts at austerity have been painful, and PEP says we should expect more pain if the government is to return the country to a semblance of fiscal stability. ..
Would you like to comment on this article?
Sign up (it's quick and free) or sign in now.
Please read our Comment Policy before commenting.
This article is free to read if you sign up or sign in.
If you have already registered or subscribed, please sign in to continue.
Questions or problems? Email helpdesk@businesslive.co.za or call 0860 52 52 00.