The government is moving towards explicit budgets which will show taxpayers how their money will be spent and it will also try its utmost to provide value for money in all its transactions, Gill Marcus, Deputy Finance Minister, promised at a Saturday Star/Magnus Heystek/First National Bank Investor's Club meeting in Johannesburg recently.
Marcus urged investors to remember the grim economic circumstances in South Africa before the 1994 elections, and to compare these with positive contributions the ANC had made since it had come into power.
"In 1994 we had seen long periods of negative growth, a loss of confidence in the economy, high unemployment, extreme poverty and extensive government borrowing but the money had not been spent on things we needed. We had spent our money on buttressing apartheid. Since 1994, we have seen a steady, if low, growth of between two and three percent a year.
"Part of the urgency about the growth rate is that we estimate with three percent growth we create 100 000 new jobs. But we have about 300 000 new labour entrants every year. Jobless growth on its own is not going to do it for this country."
Marcus said the ANC government had facilitated export-led growth at a rate of about 15 percent since 1996.
"That has been assisted by the depreciation of the rand, but it also means that business is working in a partnership (with international business). In the same period, imports have only increased by about two percent."
A renewed focus on budget reform would have a major impact on how the various tiers of government interact with the private sector.
"We are moving to a three-year horizon, and will show what we are planning to do. This is a very major shift which will take some years to complete, but will give us a greater financial management capacity."
Currently government departments have no concept of value for money, but they would soon have to be budgeting in line with anticipated targets.
"It will put a lot of stress on the skills we have in government. It will create far greater awareness of how taxpayers' money is spent."
Marcus said the government had an interest payment of R40 billion - about 20 percent of the total budget - and it could only afford about R4 billion for housing. The government plan was to "turn the corner of interest repayments" when comparing this to the annual budget allowance.
"We need a consistent monetary policy. We are pleased inflation hasn't gone into double-digit figures and we're looking to see that it doesn't. An interest rate reduction is the (Reserve Bank) governor's call. I'm sure he's very aware of the domestic and international view on our interest rate."
Marcus said the government would continue to focus on state asset restructuring and Transnet and the airport companies were the next ports of call.
She also reminded investors that "you cannot have a growing, flourishing South Africa if the region is lacking because then South Africa becomes a magnet and everyone runs down".
"So we're working with other countries on a number of projects, for example the Mozambique port development and the Maputo corridor."