Think-tank urges Mboweni to slash funding for state-owned enterprises

24 June 2020 - 09:16 By ERNEST MABUZA
Finance minister Tito Mboweni.
Finance minister Tito Mboweni.

Finance minister Tito Mboweni's budget presentation on Wednesday is an opportunity to show that the government is on the side of individual citizens who want to create prosperity and employment through their own hard work and enterprise.

This was the view of the Institute of Race Relations a few hours before Mboweni was due to present his supplementary budget.

“The success of minister of finance Tito Mboweni’s critical performance today will hinge on whether he introduces the pro-growth, pro-enterprise reforms desperately needed for a recovery capable of getting SA and its people back to work.

“He faces a stark yet simple choice: SOEs or SMEs — state-owned enterprises or private small and medium-sized enterprises,” the IRR said.

It said the alternative for Mboweni was to side with the ideologues in the SA Communist Party who insist, along with their allies in the trade union movement, that protecting failing, expensive, bloated and corrupt vanity projects, and supporting an unaffordable public sector wage bill, are more important.

The IRR said with a few common-sense announcements, Mboweni could reinvigorate the SA economy, and show that he is on the side of job creators.

The think-tank said Mboweni should commit the government to ending the disastrous policy lockdown with immediate effect.

It also urged him to announce that the government is slashing expenditure on all state-owned enterprises (SOEs), maintaining only necessary expenditure on SOEs such as Eskom to provide at least a measure of infrastructural stability for economic recovery.

It said Mboweni should summon the courage to ruthlessly cut the bloated public sector wage bill.

“The Covid-19 lockdown has shown that the people of SA have the power to demand change, and to achieve victories against the will of the state,” IRR deputy head of policy research Hermann Pretorius said.