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    Austerity Without Consolidation: Fiscal policy and spending choices in Budget 2023
    (SCIS, 2023-06-01) Michael Sachs; Rashaad Amra; Thokozile Madonko; Owen Willcox
    Fiscal policy can play a crucial role in fostering growth and development by ensuring the sustainable delivery of essential public services. Managed effectively, government’s budget can help us build a common society and overcome the segregation and inequality of the past, without which sustained economic growth seems unlikely. It can also respond to temporary macroeconomic shocks to aggregate demand and livelihoods. South Africa however finds itself in a worsening fiscal impasse. There is continuous austerity, dating back more than a decade, but South Africa appears no closer to achieving fiscal consolidation. This position is steadily eroding the fiscal capabilities necessary for the state to realise the potential that fiscal action offers. Instead, the budget is increasingly becoming a drag on development.
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    Spending choices in Budget 2022
    (Southern Centre for Inequality Studies, 2022-07) Sachs, Michael; Ewinyu, Arabo K.; Shedi, Olwethu
    This paper offers an independent appraisal of expenditure choices implied by the budget 2022 numbers by presenting National Treasury budget data in a form that is accessible and policy-relevant. The analysis may not be uncontroversial or “neutral” but is balanced and grounded in evidence. The report’s focus is on spending allocated through the national budget. Other elements of public spending (such as the state-owned companies, the budgets of metropolitan municipalities and spending financed by rates, levies or user charges) are mentioned where relevant. Tax policy is dealt with in passing but future reports aim to tackle the revenue side of the budget directly. After discussing the fiscal context for expenditure choices, the report analyses the aggregate resource allocation and choices implied by the budget estimates and then considers expenditure trends in each major policy area: healthcare, education, social protection, criminal justice and defence, economic policy and community development.
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    Public services, government employment and the budget
    (Southern Centre for Inequality Studies, 2022-10) Sachs, Michael; Ewinyu, Arabo K.; Shedi, Olwethu
    This report presents independent analysis using publicly available data on budgets, audited spending outcomes, and government plans for future expenditure. Our main concern is to draw inferences about the impact of budget choices on the allocation of real resources to core public services. The quantitative nature of budget choices means that, in contrast to other forms of policy expression, trade-offs between different policy goals are made clear and explicit. The report attempts to gauge the quantitative aspect of public policy in three respects. First, we identify the trends in real spending over the last two decades. Second, we use the budgets approved by parliament and provincial legislatures to gauge the impact of budget choices on real resource allocation over the next three years. Third, we present analysis of government pay and employment trends, which are strongly concentrated in the core public services that are our interest.