Chairperson, the ACDP supports the report on the 2014 Fiscal Framework and Revenue Proposals. We know that the Budget was very well received by commentators and economists, and we as the ACDP believe that the Minister has not departed from the prudent countercyclical fiscal policy, notwithstanding the labour unrest in the mining sector, as well as slowing global and domestic economic growth prospects.
We are also pleased to see that the Budget is now firmly aligned with the National Development Plan, and this we believe provides policy certainty. That is what investors are always looking for. Both foreign and domestic investors look for policy certainty. It sends a very clear message to reassure those investors and credit rating agencies that National Treasury will not deviate from its trademark fiscal conservatism, notwithstanding political pressure from various quarters. In our view and as other media commentators have pointed out, prudence has trumped populism.
We also need to bear in mind that the fiscal outlook for the years ahead is going to be challenging. With the onset of the 2009 recession, government was able to use the fiscal space built in the preceding years to support the economy. However, there is now very little space to move. The changed environment has significant implications for revenue collection, with global interest rates rising, and the rand depreciation and weaker commodity prices having significant fiscal implications. Our projected debt service costs for 2014-15 are R5 billion higher than estimated in October 2013, and that is obviously cause for concern.
Our economic growth remains below our potential with the terms of trade deteriorating, and they are unlikely to improve over the medium term. A weaker outlook for commodity prices, as pointed out in the report, has contributed to a downward revision of the estimated tax revenue.
We share concern about the debt to gross domestic product ratio, as pointed out by my colleague from the DA, in that it will reach just below 45% in the outgoing years, up from the 40% that was indicated earlier. Debt service costs rise faster than any other category of spending over the medium term, which in our view crowds out spending on developmental priorities.
We also, of course, need to look at our wage bill, which is increasing. Almost 40% of the consolidated noninterest expenditure is spent on our wage bill and we know that a new wage bill will have to be negotiated with the three-year bargaining cycle coming to an end. We must have an affordable wage sector wage agreement. That will have to be negotiated.
We support government's cutting down on wasteful expenditure and the Minister's announcements in that regard, but clearly much more needs to be done. Across the House we are in agreement with that. The issue of the estimated R30 billion being misappropriated must be addressed.
May we wish the Minister everything of the best. We congratulate chairperson Mufamadi on his birthday today as well. The ACDP, as indicated, will support the Budget and the fiscal report. Thank you. [Applause.]