Budget Speech 2020 summary

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Budget Speech 2020 figures at a glance [infographics]

A breakdown of the Budget Speech 2020 in bite-sized chunks.

Budget Speech 2020 summary

Image via Adobe Stock

The Budget Speech is behind us. No blood spilt and no points of order to write home about. Some even went so far as to describe the speech as ‘bleak’. Spoiler alert, it wasn’t Julius Malema.

To be honest, we expected a bit more from this year’s budget’s speech, something a bit more substantial, but it is what it is. If you missed the delivery, we’ve collected all the important figures in one place.

Budget Speech 2020 framework

  • Low growth led to an R63.3 billion downward revision to estimates of tax revenue in 2019/20 relative to the 2019 budget. Debt is not projected to stabilise over the medium term, and debt-service costs now absorb 15.2% of main budget revenue.
  • The 2020 Budget proposes total reduction of R261 billion over the next three years, which includes R160.2 billion reduction to the wage bill of national and provincial departments and national public entities.
  • Re-allocations and addition total R111.1 billion over the medium term, of which R60 billion is set aside for Eskom and South African Airways (SAA)
  • These measures narrow the consolidated deficit from 6.8% of GDP in 2020/21 to 5.7% in 2022/23, with debt rising to 71.6 of GDP over the same period.
  • Along with faster economic growth, fiscal sustainability will require targeted reduction of specific programmes, and firm decisions to rein in extra-budgetary pressures, including reform of state-owned companies and the Road Accident Fund (RAF).

Read more here: Budget Speech bailouts: Mboweni throws SAA a R16.4 billion bone, and also: Tito Mboweni backs Eskom alternative.

Budget speech 2020

Health, education, social development and security

Finance Minister Tito Mboweni also highlighted that education and health will be treated as a priority. To that effect, government will increase spending on schools and health care. Mboweni said:

“The largest spending areas will be learning and culture, which receives R396 billion, followed by health with R230 billion, and social development with R310 billion.”

About R212 billion was set aside for economic development, which includes industrialisation and exports, agriculture and rural development, job creation and labour affairs, and science and technology.

Furthermore, R217 billion will go towards peace and security: Police services will be granted R106 billion, while the remaining funds will be allocated between defence and state security, as well as law courts, prison and home affairs.

Read more here: Budget Speech 2020: Increased spending on education and health

Budget speech 2020

Debt-service costs and community development

Concerningly, debt-service costs remain one of the largest cost items in the budget with the government allocating R227 billion to servicing debt.

In context, the government will be spending virtually the same amount on servicing debts as it will on health care spending, and will spend R10 billion less on peace and security than it will on debt service costs.

Learning and Culture, Health and Social development will make up just under 48% of the budgeted expenditure for the new year with Community development, Peace and Security and Economic development, making up nearly 33%.

Debt service costs will represent nearly 12% of the total budgeted expenditure for 2020/21.

Budget speech 2020

The complete infographic can be viewed here.

Also read – Budget Speech 2020: The good, the bad and the ugly in 12 quotes