Africa-Press – South-Africa. Finance Minister Enoch Godongwana has been suggested to be considering tapping into government’s reserves to close the gap between revenue shortfalls and growing State expenditure after he stated that it would run out of money before April.
The Democratic Alliance (DA) said it would not support what it termed a “raid on the Reserve Bank” for government to fund its widening budget deficit.
There were suggestions that the Minister of Finance, Enoch Godongwana, was looking into tapping into government’s R450 billion reserves to plug the gap between revenue shortfalls and growing State expenditure.
Speaking in Parliament on Monday, the DA’s Dion George said government needs to make better choices to grow the economy and rein in wasteful spending.Godongwana is looking for money, but to take on more debt means spending more on borrowing costs.
The Finance Minister said government would run out of money before the new financial year, and cutting government expenditure wouldn’t be enough to make up the shortfall.
However, George said digging into the Gold and Foreign Exchange Contingency Reserve Account was not the answer.
“The reason why there is a reserve is so that it can actually do various things that are important for the financial mechanisms and also to ensure the wellbeing of our currency. We need to know more about that, but it certainly looks like a raid on the bank.”
Instead, the DA proposed saving billions by reducing high-earning managers in government, fruitless and wasteful expenditure, shutting down the National Youth Development Agency and canning the National Health Insurance (NHI).
George said government could also save around R60 billion over the medium term if it stopped taking over the debt of ailing state-owned enterprises.
For More News And Analysis About South-Africa Follow Africa-Press
