PRE-BUDGET SUBMISSION

The Institute for Economic Justice (IEJ) critiques the South African National Treasury's approach to debt reduction through expenditure cuts, asserting that such austerity is economically flawed and violates constitutional and international human rights obligations. The report highlights the negative impacts of budget cuts on education and healthcare, noting that the 2021 Budget's non-interest spending is projected to contract at an annual real average rate of 5.2 per cent. To counter this, the IEJ suggests utilizing additional fiscal space from SARS revenue windfalls and IMF funding, implementing progressive taxes such as a wealth tax and social security tax, and launching a GDP-linked stimulus package. The document advocates for a Universal Basic Income Guarantee (UBIG) and the conduct of gendered human rights impact assessments to guide fiscal policy.

• The National Treasury's strategy of fiscal consolidation is described as economically flawed, with the 2021 Budget projecting that consolidated non-interest spending will contract at an annual real average rate of 5.2 per cent, leading to real reductions in public services.
• South Africa's general government gross debt is projected by the IMF to reach 89% by 2024, which the IEJ argues is not an anomaly compared to other emerging market and middle-income economies like Brazil (100%), Egypt (87%), and India (86%).
• Budget cuts are negatively impacting human capital; specifically, in Kwa-Zulu Natal, a budget cut of R6.3 billion is expected to prevent the filling of 2,000 teacher vacancies and lead to the retrenchment of 4,000 teachers.
• The report identifies available fiscal space from a SARS revenue collection windfall of R99.6 billion above the 2020 MTBPS forecasts and R65 billion in emergency funding from the IMF's Special Drawing Rights (SDR) effective August 2021.
• The IEJ proposes several progressive tax measures to raise revenue, including a social security tax (SST) that could generate R67.29 billion in 2022/23, and a wealth tax of 1% for the top 1% and 3% for the top 0.1% which could generate R59 billion.
• The document argues that the National Treasury's fiscal strategy may violate the principle of non-retrogression and the International Covenant on Economic, Cultural, and Social Rights (ICECSR) by diminishing the realization of socio-economic rights.
• The IEJ suggests a stimulus package of 10% of the GDP (R492.2 billion), which it estimates would generate R826.9 billion in income and create 3.3 million jobs.

APA

Sibeko, B., & Mncube, Z. (2021). PRE-BUDGET SUBMISSION. Institute for Economic Justice. https://iej.org.za/wp-content/uploads/2021/09/Pre-Budget-Submission.pdf

Chicago

Sibeko, Busi, and Zimbali Mncube. PRE-BUDGET SUBMISSION. Institute for Economic Justice, 2021. https://iej.org.za/wp-content/uploads/2021/09/Pre-Budget-Submission.pdf.

Wikipedia

{{cite report |last1=Sibeko |first1=Busi |last2=Mncube |first2=Zimbali |title=PRE-BUDGET SUBMISSION |publisher=Institute for Economic Justice |date=17 September 2021 |url=https://iej.org.za/wp-content/uploads/2021/09/Pre-Budget-Submission.pdf |access-date=17 August 2026 |via=Climate Insights Directory}}

BibTeX

@techreport{sibeko2021prebudget, author = {Sibeko, Busi and Mncube, Zimbali}, title = {{PRE-BUDGET SUBMISSION}}, institution = {Institute for Economic Justice}, year = {2021}, month = sep, url = {https://iej.org.za/wp-content/uploads/2021/09/Pre-Budget-Submission.pdf}, urldate = {2026-08-17}, note = {Indexed by Climate Insights Directory} }