Update on the sustainable fiscal framework and measures taken to address economic challenges
27 November 2017
President Jacob Zuma has directed the Minister of Finance, Mr Malusi Gigaba assisted by the Presidential Fiscal Committee, to identify concrete measures to urgently address the challenges identified in the Medium-term Budget Policy Statement.
The President as well as Cabinet have re-affirmed government's commitment to maintain a sustainable fiscal framework and to ensure that a solution is found to address the roughly R40 billion gap that has been identified, through a combination of expenditure reductions and revenue-enhancing measures.
President Zuma has directed that technical discussions of the Presidential Fiscal Committee take place, led by Minister Gigaba and the National Treasury, to focus on four areas, with a view to the proposals that emanate from this process being considered through the budget structures in preparation for the 2018 Budget.
The four areas are:
-To identify and finalise proposals for cuts in expenditure amounting to about R25 billion. Such proposed cuts should not be in areas that will negatively affect economic growth prospects and job creation.
- To identify and finalise proposals for revenue-enhancing measures amounting to about R15 billion, including where appropriate, tax measures.
- To develop a phased-implementation plan to enable the proposal for fee-free higher education for students from poor and working-class backgrounds, to be implemented in a fiscally-sustainable manner.
- To identify the package of economic stimulus measures that will be implemented to enable the economy to grow at a faster rate.
President Zuma will in the coming days meet with the Presidential Fiscal Committee to receive a progress report on the work done on the above.
Issued by Bongani Ngqulunga on behalf of The Presidency, 27 November 2017