MPS WANT ANSWERS ON SACU RECEIPTS DROP

MBABANE – MPs have decried the lack of strategy or plan over the proposed decrease in SACU receipts in the Mid-Term Budget Review Report.

This was during a debate on the Mid-term Budget Review Report 2021/22 yesterday by the Members of Parliament (MPs). Kukhanyeni MP Malavi Sihlongonyane was the first to raise that the mid-term budget was not clarifying what the way forward was since SACU receipts had decreased. SACU is the South African Customs Union.

Siphocosini MP Mduduzi Matsebula also highlighted how page five of the budget review detailed a decrease in SACU receipts, however, he questioned why there was a decrease yet there were measures in place to increase the receipts and requested the Minister of Finance, Neal Rijkenberg, to elaborate on what the decline could be attributed to.

Questioned

Kubuta MP, Musa Mabuza questioned that as the mid-term budget review had highlighted an increase in the wage bill despite the hiring freeze, when would government start the  implementation of the Early Voluntary Retirement Scheme (EVERS).  Ndzingeni MP Lutfo Dlamini first spoke in jest how the Finance minister was becoming a strong politician based on the way he had compiled the budget review. “The minister has written the report in such a way that it will be difficult to question,” said the MP.

However, the MP questioned the fuel tax collection on page seven, stating that it was concerning that a levy was passed for a fuel reserve yet there was money still being collected even now. He questioned what it was for because the Minister of Natural Resources and Energy, Peter Bhembe, said he had collected enough in the amount of E54 million and even went to the extent of stating  that funding from outside had been sourced. The MP further questioned when the budget report would include looking into the business activity in the 59 constituencies. He wondered if the review would include how services were uplifting the people and whether the budget would include the vibrancy of businesses in constituencies.

Dlamini further questioned the non-review of the 9pm curfew, making an example of convenience stores, which could sell to customers through windows if the transmission of the virus was in fact the biggest concern. He said this was because most filling stations were closed early yet they provided an essential service and the early closure of filling stations was a major inconvenience to the country’s citizenry.

Lobamba Lomdzala MP Marwick Khumalo wanted to know whether the increase in tax collection was still the only way to ensure economic recovery. The MP questioned whether the finance ministry could avail other economic recovery strategies despite this one. He also raised a concern with regards to the EVERS issue, questioning how many civil servants would need to be retrenched in order for the situation to normalise. He highlighted that since government had cash-flow problems and EVERS was yet to be effected what would government do and what would happen going forward.

The MP also questioned when the measures applied in order to increase SACU receipts would be effective as the report stated that there was a decrease in receipts.  He wondered when the ‘Dubais’ resolution would play a role as it was agreed in Parliament therefore there was a need for the budget to point out when the measures implemented previously to reduce SACU receipts would be in effect. Mhlangatane MP Madala Mhlanga submitted that the decrease in fuel taxes could probably be attributed to the restriction imposed by the curfew because these filling stations closed early and opened late. Dvokodvweni MP Mduduzi Magagula wondered whether government had actually saved from the hiring freeze and decried the lack of reviewing of the curfew or mentioning thereof in the report, stating that it was hurting the pockets of business people.

budget

Nkhanyeti Ngwenya, Hhukwini MP, pointed out that page 35 of the budget review was not elaborate on the personnel costs despite the instituted hiring freeze. He questioned how much revenue was saved after the hiring freeze was effected. During his submission, Kwaluseni MP Sibusiso Mabhanisi Dlamini made a suggestion with regards to EVERS, questioning why government was not making it voluntary for civil servants to go home. The minister of  Finance responded to some of the questions raised during the debate, however, was then requested to answer the other questions in writing.

The minister submitted that shortfalls could be closed by spending less, increasing SACU revenue and taxes. However, he stated that to increase  tax like other countries was the aim, however, the time for that was not right now. He said before this was done the tax base had to be broadened. Rijkenberg also stated that the plan was to reduce expenditure, because currently, tax collection was at E12 billion yet the expenditure was at E26 billion. In terms of the decrease in SACU receipts the minister submitted that the measures previously implemented to ensure that the receipts decrease would only affect the country in two years time. This is to state that the effects of the measures previously taken would only be seen then.

According to the minister, the measures that were put in place to ensure SACU receipts increased would have a slight impact next year, however the larger impact will only be seen the following year. He further submitted that the decrease could also be attributed to the initial full lockdown. He mentioned that the full lockdown was quite aggressive and had lowered the SACU pool due to the decrease in trade. However, he mentioned that the lockdowns were now implemented smarter. In response to the questions on the impact of the hiring freeze, the minister submitted that they had seen a decrease of about 2 000 civil servants for the past two years which reduced the number of civil servants from about 46 000 to 44 000, which wouldn’t have been possible in previous years.

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