The 2021 Budget: Living on borrowed time
The latest report from the Centre For Risk Analysis (CRA), entitled Living On Borrowed Time assesses the macroeconomic trends and key policy risks emerging from the National Budget.
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In this month’s edition we unpack Finance Minister Tito Mboweni’s 2021 National Budget and identify the risk of South Africa’s deteriorating fiscal position.
Key takeaways:
- The government expects economic growth of 3.3% for 2021, stabilising at 1.6% by 2023.
- It expects to collect revenue of R1.52 trillion, or 28.4% of GDP in 2021/22.
- Expenditure is expected to reach R2.02 trillion in 2021/22.
- The government therefore expects a main budget balance of -R482.6 billion in 2021/22 or -9% of GDP.
- The consolidated budget balance is -R500 billion or -9.3% of GDP.
- The government expects a debt-to-GDP ratio of 81.9% in 2021/22, rising to 87.3% by 2023/24.
- Debt service costs amount to R269.7 billion (17.7% of revenue and 13.3% of expenditure).
- The budget deficit amounts to R1.4 billion being borrowed every day for the year 2021.
South Africa’s Quality of Life
The latest report from the Centre For Risk Analysis (CRA), entitled South Africa’s Quality of Life assesses living standards across SA's nine provinces as well as its four main racial 'groups'.
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The report identifies social and economic indicators where the country underperforms and what must be done to improve the lives of all South Africans.
Key takeaways:
- The Quality of Life (QOLI) Index draws comparisons between South Africa’s nine provinces and between the different race groups.
- Ten indicators are used to calculate the QOLI Index scores.
- The best quality of life is in the Western Cape province, with a QOLI score of 6.5.
- The worst quality of life is in the Eastern Cape and Mpumalanga provinces, each with a QOLI score of 5.0.
- White South Africans have the best quality of life, followed by Indian/ Asian, Coloured and Black people respectively.