South African finance minister Tito Mboweni has two major headaches to sort out before the budget in February- how to cut the ballooning civil service wage bill and how to banish “rats and thieves” in the cause of cutting government spending.
Mboweni, who heads to the World Economic Forum in Davos next week, says wastage and corruption were the biggest drains on the country’s fiscus.
“The problem with government contracts is that when there are the big ones with lots of money – that is when the rats and thieves come out!” he told a Davos breakfast in Rosebank, Johannesburg.
“The public sector wage bill is also a huge threat to the fiscus and we will be trying to find a solution before the February budget.”
Mboweni has his work cut out. Along with the job of convincing the world, next week, that South Africa can change its economy quicker he has to think hard about the budget in February. He has pledged many times not to risk fuelling inflation by printing money to bail out government coffers, the prudent alternative is likely to take a lot of canny though.
Corruption is only likely to be quelled by convictions and stiff sentences. The civil service wage bill may be an even more arduous task and more than one previous finance minister have fought shy of cutting it; the unions are strong in South Africa’s civil service and are likely to fight the minister tooth-and-nail.
February’s budget could be very interesting indeed.