CLAIRE BISSEKER: Time for SA to bite the bullet of real fiscal consolidation
SA will not achieve sustainability until it deals with the political constraints that prevent hard decision making
There is a simple explanation for the shocking deterioration in SA’s public finances: growth has been too slow for too long and, instead of cutting expenditure to bring it in line with the reduced revenue-generating capacity of the economy, SA has indulged in fake consolidation.
On the surface, the fiscal consolidation of the past five years looked real enough. After all, the Treasury imposed a hard expenditure ceiling on the government and almost always stuck to it. But it simultaneously allowed the public wage bill to balloon and state-owned enterprises to run amok, and introduced new unfunded policies at every turn...
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.
Subscribe now to unlock this article.
Support BusinessLIVE’s award-winning journalism for R129 per month (digital access only).
There’s never been a more important time to support independent journalism in SA. Our subscription packages now offer an ad-free experience for readers.
Cancel anytime.
Questions? Email helpdesk@businesslive.co.za or call 0860 52 52 00. Got a subscription voucher? Redeem it now.