Hon Chairperson, hon Minister of Finance, Deputy Minister of Finance, hon members and colleagues, heads of divisions of the Finance family present here and distinguished guests, on behalf of the Standing Committee on Finance, I would like to take this opportunity to congratulate the hon Minister and his Deputy on their respective responsibilities and appointment to serve our nation.
Furthermore, may the Minister of Finance assume office with our commendation for the sterling work done during his time as the Commissioner of Sars. We would like to wish him well in these trying times, which continue to present endless opportunities at the same time.
The challenges before us, hon members, have created unique grounds, as well as an opportunity for new ideas not only to emerge, but to be embraced. Indeed the time for a new generation of economists, scholars and intellectuals has arrived; we are not confined as a country to following previously carved out patterns of what has been said and done.
It is not only about what has failed in the recent and not-so-recent past, but a time to explore beyond what has been experimented. It is about putting to work devices of our own making, in order to realise a developmental state informed by our own practical experiences as a nation. Much has been said, and many a speculation made about the ups and downs, born of the current recession parading on our market shores. I would like to remind this House that we are not strangers to this precarious situation as a country. Lest we forget, albeit the much deserved celebration of the 1994 moment of victory, one of the stinging realities that came with us assuming responsibility, as a democratic government, was the negative economic growth we inherited. In 1997 and 1998, because of the synergy which characterised our leadership, implementation of the growth and development strategy saw us safely on the other side of the Asian financial meltdown crisis.
Of course, many changes may have altered our situation since then, but we still have the capacity to withstand and rise above the storm, as we have never abandoned our right to grow the economy of the people for the people. In this strength, I reiterate that the time for regurgitation has come and gone, because that which comes, must pass and make way for the new. It is my fervent belief, hon Chairperson, that the same will be said of this recession in years to come. Hon members, growth and sustainability are not foreign concepts to our ability; the nation and the solution are in our hands.
The National Economic Development and Labour Council's framework for South Africa's response to the downturn, in which government is a core participant, is beginning to address core issues, in a compact manner which requires all roleplayers, that is, Labour, business, civil society and the actively participating general public, to carry their weight.
We dare not fail! Our commitment to the nation is irrevocable, no matter how difficult it may appear. We will, therefore, be required to do more than is expected. We are in agreement with you, hon Minister, that more can be achieved with what is already available.
Prudence and discipline in the management of fiscal policies is required more today than ever before as the days of the public spending boom are over. We need to bear in mind that leadership is about taking responsibility for good and bad, even if it means taking unpopular decisions.
We have taken note as a committee that the fiscal policy framework, as outlined in the MTEF, presented by the previous Minister of Finance, Minister Manuel, in February this year, has since been drastically altered by the new economic realities prevailing in the world today.
There is no doubt that this change has had a serious and adverse impact on our situation, as is the case with almost all developed and emerging economies around the globe. As a country, we have already started feeling the impact and consequences of unquenchable capital greed of the so called free market economy, marking the worst economic recession experienced in the last seventy years.
The most acute task facing policymakers is not to admit or deny the reality of the current downturn, but to look at what measures and tools are available to avoid what might become a socioeconomic crisis. We are beginning to see levels of joblessness and poverty increasing, which has a direct effect on our revenue base. This poses a challenge to Sars in particular, to attain revenue projections as outlined in the MTEF. The Minister has already informed this House that we are down by almost R20 billion.
Nonetheless our commitment to the creation of decent jobs should be underpinned by a clear understanding by all in the labour market that job retention is an integral part of sustaining livelihoods in our communities.
In the public sector, to avoid the social crisis, we require a civil service cadreship which will place millions of our people at the centre of its thought process; thinking of their welfare, their future and their right to self-realisation.
This nation requires a management cadreship whose focus is on the broader development of its constituency - the people; a management which can be trusted and counted on to look after public resources as their own, because nobody uses somebody else's resources as carefully as he uses his own; a management that will not create a personalised future base by allocating huge tender contracts to companies with which they have a personal relationship and where seats are reserved for them when they leave their jobs. [Applause.]
This behaviour is, in fact, a criminal offence because in reality it is stealing from the state, depriving ordinary people of a share in what rightfully belongs to them. This nation requires a management in the Public Service and parastatals who will not compete with SMMEs for tenders; and lastly, a management in the supply chain who will root out corruption and collusion between state officials and the private sector. This is the essence of the efficiency and effectiveness required of our service and the management process today.
The hon President of the Republic, in his reply to Vote No 1, reminded us that whilst he is President of the Republic, his government derives its mandate from the ANC Polokwane resolutions.
Therefore, coupled with the fact that the ANC lives, the ANC leads and the ANC rules, there is no need to debate that obvious reality. Everybody in the Public Service and parastatals must understand that people have always been, still are and always will be our primary objective - Batho Pele. [Applause.]
In its Polokwane conference, the ANC resolved to build a strong developmental state which puts matters of health, education, rural development, job creation and sustainable livelihoods at the helm of its programme. We strongly believe that the fiscal framework, providing guidance to the allocation of resources, addresses these priorities.
In the health sector for example, the ANC believes that the demonstration of concern on the part of the state is its ability to care for the health needs of its citizens, saving them from death. Hon members, we need to understand that the availability of state resources cannot address this problem in isolation. There is a paradigm shift in mindsets which needs to take place on the part of our service providers in the health sector, who, in addition, must adopt an attitude which seeks to divorce health care matters from questions of personal means or factors irrelevant to it. Medical care must be equally available to all in need, regardless of income, and health workers should be there at all times to serve the most vulnerable, and sick people in particular.
With regard to economic transformation, hon Chairperson, the National Treasury's legislative mandate is based on Chapter 13 of the Constitution and other laws governing the financial and fiscal affairs of the Republic. It is mandated amongst many other responsibilities to promote government's fiscal policy as well as the co-ordination of macroeconomic policies. It is clear that whilst our economy has not only shown signs of resilience in the current global economic downturn, it has also in the past managed to register significant positive growth, which has not been matched by an accompanying number of jobs. Therefore, growth has not yet translated into real and meaningful change for the poor. We view the Treasury's Budget as a catalyst for government to realise its stated objectives and priorities, as outlined in the state of the nation address.
Fifty-four years after the Congress of the People outlined their perspective and vision of a new South Africa-to-be and made a clarion call that people must share in the country's wealth, to date, 15 years into the new political dispensation and the fourth democratically elected Parliament, this nation still rates as one of the countries with the highest Gini coefficient in the world. This means that whilst we have made some progress in terms of economic transformation, our policies have not yet addressed the intended objectives. Thus, the levels of disparities between the rich and the poor continue to grow.
At this point, this House may want to ask: What has this economic growth achieved in the past? Hon members, I have no hesitation in responding as follows: Macroeconomic fundamentals over the past 15 years have placed South Africa in a position to reduce its debt to GDP ratio. That has increased our positive standing internationally, and our market rating, which has resulted to a certain ... [Interjections.] [Laughter.]