* . *
  • About
  • Advertise
  • Privacy & Policy
  • Contact
Wednesday, October 22, 2025
Earth-News
  • Home
  • Business
  • Entertainment
    Sacramento city leaders approve adding 2 entertainment zones in midtown – CBS News

    Sacramento City Leaders Approve Two Thrilling New Entertainment Zones in Midtown

    AMC brings first new Dolby Experience to Gwinnett since 2017 – Wyoming News Now

    AMC Launches First New Dolby Experience in Gwinnett Since 2017

    Hetzel Design: blending architecture and entertainment – Blooloop

    Hetzel Design: Where Architecture and Entertainment Unite in Perfect Harmony

    Country music legend rushed to hospital year after heart surgery. Here’s what we know – PennLive.com

    Country Music Legend Rushed to Hospital One Year After Heart Surgery – What’s Happening Now?

    Strictly Come Dancing results: Chris Robshaw is eliminated while drag queen La Voix escapes dance-off – Yahoo

    Strictly Come Dancing results: Chris Robshaw is eliminated while drag queen La Voix escapes dance-off – Yahoo

    Placer County town of Loomis considers entertainment zone for downtown – CBS News

    Loomis Unveils Thrilling New Entertainment Zone to Revitalize Downtown

  • General
  • Health
  • News

    Cracking the Code: Why China’s Economic Challenges Aren’t Shaking Markets, Unlike America’s” – Bloomberg

    Trump’s Narrow Window to Spread the Truth About Harris

    Trump’s Narrow Window to Spread the Truth About Harris

    Israel-Gaza war live updates: Hamas leader Ismail Haniyeh assassinated in Iran, group says

    Israel-Gaza war live updates: Hamas leader Ismail Haniyeh assassinated in Iran, group says

    PAP Boss to Niger Delta Youths, Stay Away from the Protest

    PAP Boss to Niger Delta Youths, Stay Away from the Protest

    Court Restricts Protests In Lagos To Freedom, Peace Park

    Court Restricts Protests In Lagos To Freedom, Peace Park

    Fans React to Jazz Jennings’ Inspiring Weight Loss Journey

    Fans React to Jazz Jennings’ Inspiring Weight Loss Journey

    Trending Tags

    • Trump Inauguration
    • United Stated
    • White House
    • Market Stories
    • Election Results
  • Science
  • Sports
  • Technology
    A look into new technology at Columbia University that could help prevent a dangerous pregnancy complication – ABC7 New York

    A look into new technology at Columbia University that could help prevent a dangerous pregnancy complication – ABC7 New York

    Office Technology: Dealers’ Managed IT Revenue up Nearly 30% – The Cannata Report –

    Office Technology: Dealers’ Managed IT Revenue up Nearly 30% – The Cannata Report –

    3 E Network Technology Group Limited Closes $1.5 Million Convertible Promissory Note Offering – Quiver Quantitative

    3 E Network Technology Group Limited Closes $1.5 Million Convertible Promissory Note Offering – Quiver Quantitative

    3 Technology Stocks to Buy Now – Yahoo Finance

    3 Must-Buy Tech Stocks You Can’t Afford to Miss Right Now

    ‘New frontier’: Austin leaders start discussions on air taxi technology – KXAN Austin

    Austin Leaders Ignite Exciting Conversations on the Future of Air Taxi Technology

    How a Gemma model helped discover a new potential cancer therapy pathway – blog.google

    How a Gemma Model Revealed a Breakthrough Pathway for Cancer Treatment

    Trending Tags

    • Nintendo Switch
    • CES 2017
    • Playstation 4 Pro
    • Mark Zuckerberg
No Result
View All Result
  • Home
  • Business
  • Entertainment
    Sacramento city leaders approve adding 2 entertainment zones in midtown – CBS News

    Sacramento City Leaders Approve Two Thrilling New Entertainment Zones in Midtown

    AMC brings first new Dolby Experience to Gwinnett since 2017 – Wyoming News Now

    AMC Launches First New Dolby Experience in Gwinnett Since 2017

    Hetzel Design: blending architecture and entertainment – Blooloop

    Hetzel Design: Where Architecture and Entertainment Unite in Perfect Harmony

    Country music legend rushed to hospital year after heart surgery. Here’s what we know – PennLive.com

    Country Music Legend Rushed to Hospital One Year After Heart Surgery – What’s Happening Now?

    Strictly Come Dancing results: Chris Robshaw is eliminated while drag queen La Voix escapes dance-off – Yahoo

    Strictly Come Dancing results: Chris Robshaw is eliminated while drag queen La Voix escapes dance-off – Yahoo

    Placer County town of Loomis considers entertainment zone for downtown – CBS News

    Loomis Unveils Thrilling New Entertainment Zone to Revitalize Downtown

  • General
  • Health
  • News

    Cracking the Code: Why China’s Economic Challenges Aren’t Shaking Markets, Unlike America’s” – Bloomberg

    Trump’s Narrow Window to Spread the Truth About Harris

    Trump’s Narrow Window to Spread the Truth About Harris

    Israel-Gaza war live updates: Hamas leader Ismail Haniyeh assassinated in Iran, group says

    Israel-Gaza war live updates: Hamas leader Ismail Haniyeh assassinated in Iran, group says

    PAP Boss to Niger Delta Youths, Stay Away from the Protest

    PAP Boss to Niger Delta Youths, Stay Away from the Protest

    Court Restricts Protests In Lagos To Freedom, Peace Park

    Court Restricts Protests In Lagos To Freedom, Peace Park

    Fans React to Jazz Jennings’ Inspiring Weight Loss Journey

    Fans React to Jazz Jennings’ Inspiring Weight Loss Journey

    Trending Tags

    • Trump Inauguration
    • United Stated
    • White House
    • Market Stories
    • Election Results
  • Science
  • Sports
  • Technology
    A look into new technology at Columbia University that could help prevent a dangerous pregnancy complication – ABC7 New York

    A look into new technology at Columbia University that could help prevent a dangerous pregnancy complication – ABC7 New York

    Office Technology: Dealers’ Managed IT Revenue up Nearly 30% – The Cannata Report –

    Office Technology: Dealers’ Managed IT Revenue up Nearly 30% – The Cannata Report –

    3 E Network Technology Group Limited Closes $1.5 Million Convertible Promissory Note Offering – Quiver Quantitative

    3 E Network Technology Group Limited Closes $1.5 Million Convertible Promissory Note Offering – Quiver Quantitative

    3 Technology Stocks to Buy Now – Yahoo Finance

    3 Must-Buy Tech Stocks You Can’t Afford to Miss Right Now

    ‘New frontier’: Austin leaders start discussions on air taxi technology – KXAN Austin

    Austin Leaders Ignite Exciting Conversations on the Future of Air Taxi Technology

    How a Gemma model helped discover a new potential cancer therapy pathway – blog.google

    How a Gemma Model Revealed a Breakthrough Pathway for Cancer Treatment

    Trending Tags

    • Nintendo Switch
    • CES 2017
    • Playstation 4 Pro
    • Mark Zuckerberg
No Result
View All Result
Earth-News
No Result
View All Result
Home Business

Treasury’s stern warning: SA government cannot spend the country into prosperity

September 17, 2023
in Business
Treasury’s stern warning: SA government cannot spend the country into prosperity
Share on FacebookShare on Twitter

The South African National Treasury has sounded a stern warning to the government: trim spending significantly or face dire consequences. Finance Minister Enoch Godongwana has stressed the necessity of budget cuts in the upcoming mid-term budget, emphasising that excessive government spending doesn’t equate to economic growth. The Treasury’s call comes in the wake of an un-budgeted wage increase, forcing them to adjust their initial budget by billions. As South Africa grapples with economic challenges, the FMF’s Zakhele Mthembu believes that the path forward may involve deregulation, reduced taxes, and protecting property rights while reigning in government expenditures.

Sign up for your early morning brew of the BizNews Insider to keep you up to speed with the content that matters. The newsletter will land in your inbox at 5:30am weekdays. Register here.

Government cannot spend South Africa into prosperity

By Zakhele Mthembu*

The National Treasury has sent a warning to the broader government. The message is clear: drastically cut spending, or suffer the consequences. An expected message, for one can only spend so much of other people’s money, like the government does, before it runs out.

Minister of Finance,, Enoch Godongwana, has indicated that cuts to government spending will be a necessity in the mid-term budget. The head of the Treasury’s budget office also stated that the country cannot spend its way to prosperity, as increased government spending has not translated into economic growth.

The Treasury has been warning the broader government about the unsustainability of its spending efforts. When  Mr Godongwana presented the budget in February 2023, he cautioned against what was then the possible threat of an unbudgeted wage settlement.

A month later, a majority of unions in the Public Sector Coordinated Bargaining Council reached an agreement with government for a 7.5% increase. This wage increase meant that the Treasury had to adjust its initial budget by R37.4 billion to accommodate it. It was as though the unions and their members were divorced from the reality of the South African economy and the finances of the state.

Read more: Treasury introduces fiscal anchor to contain debt surge: But SA must do budget cuts right

In a statement Treasury released after the agreement was concluded, it mentioned that cutting back on non-critical appointments in governments was going to be necessary. Also, redirecting funds for projects and programmes in various departments towards wages and restricting recruitment in other areas that were planned for, were among the multiple solutions Treasury proposed.

The necessity to redirect funds, instead of increasing the budget, has come to bear as we approach the mid-term budget statement in October. This is evident in the letter the Treasury sent to various departments about cutting expenditure. 

The budget shortfall has been exacerbated by the non-actualisation of the projections Treasury had for economic growth and revenue collection. These projections that are or will not be met were ambitious, considering the policy impediments in the South African economy; things like a monopolised and failing energy market, or a labour legal regime that discourages hiring, are antithetical to economic prosperity.

South Africa is in a precarious position because, even though there is a high government wage bill, it is not due to mass employment in the public sector. Instead, research from various sources and ideological inclinations has shown that while public compensation has increased as a line item for the state, the head count for the state in terms of employees has dropped. 

The South African public has been paying more money for less public service personnel. This will only be exacerbated given the interventions Treasury will be implementing to meet the shortfall caused by the wage agreement, among many causes. Things like limiting recruitment for new positions and shedding jobs in some areas are among the solutions Treasury is suggesting to departments.

Read more: Katzenellenbogen: South Africa’s looming economic crisis – National Treasury at a crossroads

As the head of the Treasury Budget Office said in an interview about cutting spending, we are not “going to spend our way out of our current problems”. Government employees will now have to contend with the fact that their wage increase is one of the reasons their colleagues will lose their jobs. This in a context in which the average government employee is paid way more than the average privately employed individual who in fact adds productively to the economy.

Taking on further debt to meet the guaranteed budget shortfall is thankfully not being considered given our already high debt servicing obligations. The idea of the state taking on debt to be paid by future young South Africans who had nothing to do with it, is right up there in the heights of injustice.

The South African economy finds itself at a crossroads.

It can choose the right path. The route of government spending fueling economic growth has been tried, and it has failed, according to Treasury itself. Therefore, the path of deregulation in as many markets as possible, cutting government spending, reducing taxes for individuals, and ensuring that there is an environment wherein property rights are protected, should be tried. 

Everyone and everything should live by the principle of spending within your means. Especially the state, since it acts as representative of everyone within its jurisdiction and it cannot generate income outside of its citizens giving over to it the income they generated in the market, in the form of taxes. 
Despite the President disagreeing with the need to cut spending, the communication coming from Treasury is good. The ingredients of a low growth economy, absurdly high youth unemployment levels, and growing spending obligations from the state can only produce a social disaster. For sustainable growth and prosperity, the state must cut its spending, lest we continue down our road to serfdom.

Read also:

Industrialist takes the IDC & the PP to court: SA is an autocracy without accountability – Angus Norkie
“Bye, Bye Busi”…not a moment too soon – Paul Hoffman SC “If I perish I perish” – Busisiwe Mkhwebane
Magnus Heystek: South Africa’s looming economic catastrophe – Debt crisis threatens stability

*Zakhele Mthembu BA Law LLB (Wits) is a legal researcher at the Free Market Foundation. The views expressed in the article are the author’s and not necessarily shared by the members of the Foundation.

Visited 107 times, 107 visit(s) today

>>> Read full article>>>
Copyright for syndicated content belongs to the linked Source : BizNews – https://www.biznews.com/undictated/2023/09/15/government-cannot-spend-into-prosperity

Tags: businesssternTreasury's
Previous Post

Boardroom Talk – Comfirmed: Joburg house prices fell the most of 219 cities since 2018

Next Post

Rapper Jeezy Files for Divorce From ‘The Real’ Host Jeannie Mai Jenkins

Grandmaster Daniel Naroditsky remembered for his impact on the chess world – NPR

Grandmaster Daniel Naroditsky: Celebrating a Lasting Legacy in the Chess World

October 22, 2025
Seattle’s Creative Economy: Building Talent, Culture, and Community – GeekWire

Seattle’s Creative Economy: How Talent, Culture, and Community Are Shaping the Future

October 22, 2025
Sacramento city leaders approve adding 2 entertainment zones in midtown – CBS News

Sacramento City Leaders Approve Two Thrilling New Entertainment Zones in Midtown

October 22, 2025
Self-efficacy mediates the effect of hope on health promotion intention in Chinese stroke patients – Nature

How Hope Boosts Health Motivation in Chinese Stroke Patients Through Self-Efficacy

October 22, 2025
Arizona AG sues to force House Speaker Johnson to seat Democrat Adelita Grijalva – NBC News

Arizona AG sues to force House Speaker Johnson to seat Democrat Adelita Grijalva – NBC News

October 22, 2025
Historic achievement: Governor Ferguson, Ecology celebrate nuclear waste officially being turned into glass at Hanford Site | Governor Bob Ferguson – Governor Ferguson (.gov)

Historic Breakthrough: Governor Ferguson and Ecology Celebrate Nuclear Waste Transformed into Glass at Hanford Site

October 22, 2025
Transcript: Mission to Mars — Bad science fiction – Financial Times

Mission to Mars: When Science Fiction Takes a Dark Turn

October 22, 2025
Science Hill, South Greene volleyball win TSSAA state tournament openers – WCYB

Science Hill and South Greene Dominate Opening Matches in TSSAA State Volleyball Tournament

October 22, 2025
GCC Influencer Market Jumps 75% As Lifestyle Creators Lead Growth – Net Influencer

GCC Influencer Market Soars 75% Fueled by Lifestyle Creators Leading the Boom

October 22, 2025
A look into new technology at Columbia University that could help prevent a dangerous pregnancy complication – ABC7 New York

A look into new technology at Columbia University that could help prevent a dangerous pregnancy complication – ABC7 New York

October 22, 2025

Categories

Archives

October 2025
M T W T F S S
 12345
6789101112
13141516171819
20212223242526
2728293031  
« Sep    
Earth-News.info

The Earth News is an independent English-language daily published Website from all around the World News

Browse by Category

  • Business (20,132)
  • Ecology (880)
  • Economy (902)
  • Entertainment (21,773)
  • General (17,740)
  • Health (9,943)
  • Lifestyle (914)
  • News (22,149)
  • People (902)
  • Politics (912)
  • Science (16,112)
  • Sports (21,401)
  • Technology (15,881)
  • World (885)

Recent News

Grandmaster Daniel Naroditsky remembered for his impact on the chess world – NPR

Grandmaster Daniel Naroditsky: Celebrating a Lasting Legacy in the Chess World

October 22, 2025
Seattle’s Creative Economy: Building Talent, Culture, and Community – GeekWire

Seattle’s Creative Economy: How Talent, Culture, and Community Are Shaping the Future

October 22, 2025
  • About
  • Advertise
  • Privacy & Policy
  • Contact

© 2023 earth-news.info

No Result
View All Result

© 2023 earth-news.info

No Result
View All Result

© 2023 earth-news.info

Go to mobile version