2022 Medium Term Budget – Highlights
Finance Minister Enoch Godongwana announced the 6 month review and adjustments to the annual budget.
It is good to review your budget regularly. Even government does so. Each year after a few months the Finance Minister will make an announcement about how things are going and what items in the budget have been tweaked as time goes by.
‘it is good to look at your budget regularly’
Circumstances change. This is why it is good to look at your budget regularly (eg. once per month) to see if there has been any change to income or expenses. This keeps your budget current and relevant.
A War In Europe & More Income
This month the SA Finance Minister announced that there have been both a significant change in income, as well as, world circumstances. Both of these factors mean that Government will now be adjusting some of their spending plans.
Russia invading Ukraine and the war in Europe along with the resulting global sanctions against Russia and the resulting energy crisis has changed the world economic outlook. Even here at the foot of Africa we are not exempt from the pressures (and opportunities) this presents.
At the same time, Government has made more money from tax than they were expecting to make. Quite a lot of extra money actually. About R83.5 Billion extra.
‘used to bail out some of SA’s biggest problem children namely Eskom, Denel, Sanral and Transnet’
These funds (and others) are being used to bail out some of SA’s biggest problem children namely Eskom, Denel, Sanral and Transnet.
Eskom
Because we need Eskom to keep the lights on, Government has decided to take on either 1/3 or even 2/3rds of its debts to try rescue it from its massive debt burden and years of abuse and looting.
The final figure will be announced early next year during the next Budget speech.
E Tolls & Sanral
People hate paying for E Tolls in Gauteng so, Government (provincial and National) will pay the current debts owed and then…well, who knows? It is a bit foggy as to what happens next.
Government will bail out Sanral to the tune of R23.7 Billion.
Transnet
The floods in KZN and the Eastern Cape mean that rail repairs are needed to both fix what was damaged but also increase capacity as road routes come under added pressure.
Transnet get R5.8 Billion.
Denel
The people at Denel have access to lots of weapons but not so much money so, Government will help them try turn things around by handing them a bailout of R204.7 Million.
The R350 Grant
In efforts to avoid any basic income grant discussions (and where that money could ever possibly come from) Government has wisely decided to extend the R350 grant till March next year.
Since a lot of people never got to claim it this year with all the confusion and changes they had extra money lying around anyway so they are going to carry on paying out this grant to those who can figure out how to claim it and if they qualify.
Salary Increases
Government are really sticking to their 3% increase offer…they are just adding R1000 per month on top of it so, it kind of makes it somewhere around 7% for a lot of employees. The extra cash will be in place until the next Budget.
You Get A Bail Out, You Get a Bail Out, Everyone Gets a Bailout (not you SAA)
All in all, it seems that efforts are being made to use the extra income to address some of the country’s biggest problems.
If you have a monthly budget then remember to review it from time to time.
If you don’t have a budget and find managing your finances tricky consider asking a Debt Counsellor for some advice. Most Debt Counsellors will assist consumers with this service for free.
