Steenhuisen lauds new budget as ‘credible’

The head of South Africa’s second-biggest political party said talks about the nation’s revamped budget are “are going very, very well,” a signal that the coalition government is resolving differences that derailed the National Treasury’s previous tax and spending proposals.

“We had a wonderful presentation by the minister of finance,” on a third iteration of the budget, Democratic Alliance leader John Steenhuisen told reporters at the Nampo Harvest Day expo in the central Free State province on Friday. “I think we’re certainly getting there.”

“There really a sense of collaboration and working together to put on the table a credible budget that will be a strong stable platform for us to go out and seek confidence from our investors and also to start growing the economy and creating jobs here in South Africa,” he added.

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Steenhuisen’s comments follow an assertion by Deputy Finance Minister David Masondo, on Thursday that he is “very confident that we’re not going to have budget 4.0,” and that lawmakers will approve the proposals in parliament May 21.

Last year’s election failed to produce an outright winner, with the African National Congress setting up a 10-party coalition in June, a month the vote in which it lost parliamentary majority it had held since apartheid ended in 1994.

The DA and African National Congress have since February sparred over issues including the National Treasury’s proposal to hike value-added tax — all of which raised questions about the alliance’s durability.

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Tensions escalated last month, when the ANC enlisted the backing of parties that aren’t part of the coalition to pass the fiscal framework — legislation that underpins the budget — after the DA withheld its support. The DA then filed a lawsuit contesting the adoption of the legislation on procedural grounds.

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The Treasury backed down, saying it would scrap the planned VAT hike, cut spending to fill a R75 billion ($4.2 billion) gap in the budget over the next three years, and seek to settle the court case with the DA.

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