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Parliament Briefed on Budget 2022

February 28, 2022

National Treasury

Government continues to reprioritise, reallocate and review spending to meet policy priorities and improve efficiency.

National treasury highlighted this during a briefing in parliament on Budget 2022.

The finance minister, Enoch Godongwana, delivered his maiden Budget speech in parliament on 23 February 2022.

During the briefing, treasury declared that, while the outlook for 2022 has been revised upward, “persistent structural constraints continue to inhibit the pace of the recovery from COVID‐19 and longer‐term growth”.

However, government’s fiscal position has improved since the 2021 Medium Term Budget Policy Statement due to higher‐than‐anticipated revenue collection.

Treasury confirmed that the revenue will be used to alleviate short‐term spending pressures and reduce the budget deficit.

Treasury emphasized that government remains committed to stabilising the debt‐to‐GDP ratio by focusing on prudent and sustainable spending.

Large spending pressures going forward include the risk of higher‐than‐budgeted public service wages, state-owned companies demanding additional funding and calls for permanent increases in spending that exceed available resources.

As regards social protection, treasury pointed out that government is working on a sustainable long‐term approach “consistent with government’s broad development mandate and the need to ensure affordability”.

Meanwhile, in a statement, the South African Revenue Service (SARS) welcomed the upwardly revised revenue collection estimate announced by the finance minister during Budget 2022.

Godongwana announced a revised revenue estimate of R1 547.07 billion as compared to the February 2021 Budget estimate of R1 365.1 billion.

SARS indicated that the “extra income earned by commodity producing and exporting companies accompanied by SARS’ deliberate and targeted tax compliance work have resulted in a better than expected increase in tax revenue”.