A joint meeting of parliament’s standing committee on finance and select committee on finance sat on Tuesday morning to consider the third iteration of finance minister Enoch Godongwana’s 2025 budget.
However, the sitting to consider the draft committee report on the fiscal framework and revenue proposals was dogged with tension over the budget’s fuel levy hike proposal, the National Treasury’s growth outlook projections and, of all things, a fire alarm.
The meeting was taking place as the EFF was challenging the proposal for an inflationary increase in the general fuel levy for petrol and diesel to R4.01 per litre and R3.85 litre, respectively, at the Western Cape High Court in Cape Town. The two previous budgets were rejected over VAT hike proposals.
We recognise the EFF has initiated a legal challenge at the high court concerning the fuel levy. We respect the judicial process in line with the principle of the separation of powers. We are committed to monitoring the developments in the court case very closely
— Joe Maswanganyi, parliament's standing committee on finance chair
The committee will on Tuesday consider the draft committee report and will meet on Wednesday to adopt or amend the report. If it is not rejected by the committee or struck down by the courts, the fuel levy hike will be effective from Wednesday.
From the beginning of Tuesday’s meeting, it was clear that while Godongwana’s third attempt to table the budget was less dramatic than the first two, members of parliament were some distance apart on agreeing about the revenue proposals.
Standing committee on finance chair Joe Maswanganyi said parliament had 15 days to process the fiscal framework thoroughly, but Tuesday’s meeting would only be for consideration of the budget report, which would be adopted or amended on Wednesday.
“We recognise the EFF has initiated a legal challenge at the high court concerning the fuel levy. We respect the judicial process in line with the principle of the separation of powers. Separation of powers is a fundamental principle in governance that divides the state into three branches. We are committed to monitoring the developments in the court case very closely,” he said.
MK Party MP Des van Rooyen said it would be procedurally challenging for the committee to consider the draft report as members sent National Treasury questions which have not yet been answered regarding the revenue proposals and Treasury’s growth outlook.
“I’m not sure how we factor that in because all the questions are relevant to the budget process. I’m not sure how you factor in that unfortunate event in today’s processes,” Van Rooyen said.
A National Treasury official told the committee Gondongwana would respond to the questions “soon”.
Maswanganyi later insisted the questions be responded to before Wednesday’s finalisation of the draft report.
EFF MP Sinawo Thambo raised concern that the short timeline between the draft report consideration and the fuel levy hike coming into effect, which could be invalidated by the courts, put parliament in a precarious position.
“Parliament will sit on June 11 to consider adoption or rejection of the budget. We felt for the taxation adjustment to occur on the fuel levy before this parliamentary process was undermining parliament,” he said.
Maswanganyi said parliament will allow the high court to apply its mind to the EFF’s case, and the courts will allow the legislature to continue with its processing of the budget.
While the MPs were studying the draft report clause by clause, a fire alarm went off and persisted while they deliberated. MPs agreed to take the cautious approach and evacuate the committee room and await instructions from on-site police. However, minutes later, it was established the alarm was triggered by a substance deployed during maintenance work and there was no threat to property or the MPs.
DA MP Mark Burke stressed the final report must indicate the committee rejects or amends the fiscal framework and revenue proposals as allowed in the Money Bills and Related Matters Act.
MK Party MP Brian Molefe asked the National Treasury to provide clarity on where it got its growth outlook projection figures, which estimates real GDP growth will reach 1.4% in 2025, 1.6% in 2026, and 1.8% in 2027, all more optimistic than the International Monetary Fund and the SA Reserve Bank.
Thambo said it is vital parliament exhausts its public participation obligations when it comes to the latest iteration of the budget to avoid a constitutional crisis for the legislature.
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.