Pre-2024 MTBPS Workshop: PBO briefing

The joint workshop session focused on South Africa's fiscal outlook ahead of the medium-term budget policy statement (MTBPS), with the Parliamentary Budget Office (PBO) providing an in-depth review of national fiscal and social challenges. Members expressed strong concerns about the limited success of current municipal support measures, such as Sections 154 and 139 interventions, which aimed to stabilise struggling municipalities but had not produced the expected improvements. They called for a study on these interventions to understand and address possible implementation issues. Additional concerns about inconsistent spending across government departments were raised, highlighting accountability as key to efficient resource allocation. Social welfare and poverty alleviation were also central topics, with Members noting that while 45% of the population relied on social grants, many remained below the food poverty line, which worsened the financial strain on low-income households. High youth unemployment, recorded at 46.6%, alongside an overall joblessness rate of 33.5%, was identified as a critical issue, underscoring the need for structural reforms to address economic constraints. The PBO’s presentation also outlined a subdued macroeconomic outlook, with South Africa’s projected growth for 2024 at 1.5%, and spending trends revealing varied budget utilisation across departments. Revenue collection between April and August had shown a year-on-year increase of R28.5 billion, largely due to a rise in personal income tax, though corporate income tax had declined by 2.2% due to reduced mining contributions. Additionally, while nominally increased to R324.5 billion, education funding was slightly reduced in real terms when adjusted for inflation, and primary school enrolment declined from 88.2% in 2013 to 86.8% in 2023. Concluding the session, the Chairperson urged the PBO to prioritise a study on municipal interventions, emphasising its potential to better guide Parliament in supporting municipalities.