Hon Chairperson, Deputy President of the Republic of South Africa, Ministers, Deputy Ministers and august members of this House, I stand here on behalf of the ANC in a bid to clarify certain issues that other people do not understand, like the speaker just before me. I am tempted to clarify the fact that the role of opposition parties these days has turned to being a misleading kind of informer who sensationalises issues and overstates the reality of things. I want to put it very clearly, hon Minister of Finance, that whatever is being said by the opposition must not weaken you but strengthen you, because it is not justified, and it is factually incorrect. Given that we are dealing with the Medium-Term Budget Policy Statement, the MTBPS, the economic outlook is an obvious concern in the inputs. Here the majority of inputs received paid great attention to forecasting and used various assumptive models on both the external and internal factors affecting the economy. These spoke to the Medium-Term Expenditure Framework, the MTEF, period and largely reflected the view that in 2013 an improving global economy was likely to support stronger growth in domestic exports, while implementation of key economic infrastructure should bring about faster growth.
Similarly, inputs predict that the economy will remain vulnerable to slow global recovery and domestic factors such as the recent labour unrest, a point which was raised sharply by the Financial Fiscal Commission, the FFC. In the absence of positive shocks, the commission predicted that GDP growth was not likely to recover.
Inflation was another area that all submissions paid attention to. Most submissions agreed that inflation is expected to remain within the target band of 3% to 6% over the next three years, averaging at 4,9% in 2015. The greater concern that the committee noted, something which is not a new matter, is food prices and, in particular, administered prices which will together be responsible for keeping the consumer price index, CPI, towards the upper end of the inflation target band.
Specifically on administered prices and in particular on Eskom's electricity costs, the majority of submissions raised serious cause for concern both in terms of billing and in administrative inefficiencies. It was recorded that Eskom increased electricity prices significantly between 2000 and 2010, while other emerging countries have experienced a decrease in costs. The manufacturing sector further expressed the concern that higher interest rates increased the cost of capital to internationally uncompetitive levels. There were major concerns raised in submissions that domestic supply constraints, including electricity rationing in manufacturing and disruptions to mining outputs, have exacerbated the pressure on exports, leading to weaker global demand and that the weaker rand has provided little support for manufacturing growth.
In addition, the importance of mining and the manufacturing sector to the export sector and labour absorption was raised. Also, in particular, the FFC was of the view that the government should closely monitor these sectors. This concern was expressed for two reasons: one is the contribution of these sectors to the GDP and the negative impact on GDP growth, as these sectors shrink in size; the other is the jobs targets that have been set nationally and the impact of both the manufacturing and mining sectors further shrinking over the medium term.
Most submissions touched on the impact of illegal strikes and stoppages in the mining sector and drew a strong connection between the mining industry and the manufacturing sector in terms of exports and employment. Submissions applauded National Treasury's approach in campaigning to combat waste, inefficiency and corruption, including procurement reform. The addressing of shortcomings in planning, procurement and contract management and the focusing of departments towards prioritised spending and identified savings, which amount to R40 billion over the next three years, was widely welcomed.
On government financing and debt, in line with the fiscal policy objectives of stabilising debt, submissions broadly reflected support for subdued growth in noninterest expenditure towards the last year of the MTEF period.
Within 90 days of adoption of this report by the House, the ANC hereby requests the hon Minister and the National Treasury to report back to the House on government's approach to managing overall employment and moderating expenditure on compensation of employees. The National Treasury should also develop and provide the House with a contingency plan in the event that macroeconomic projections do not result, as expected, in the proposed fiscal framework, and should report back to the Standing Committee on Finance.
The ANC supports this MTEF. We are a responsible organisation that is in charge, and we are in charge and responsible, and we will never point fingers at the opposition for any failure ... [Interjections.] ... but this reminds everyone that in this country of South Africa, democracy has actually afforded an opportunity to those who are not supported out there to have a say. Unfortunately, their say is not assisting anybody in this country, especially those who are considerate enough to prioritise the poor.
Major concerns were raised in submissions in that domestic supply constraints, including electricity, were an issue. We must not say, knowing for a fact that it is not correct, that the hon Minister is in denial. Those are blue lies. That is something that we cannot accept as the ANC, but we are saying, in addition to what the chairperson has said here, that this is a multiparty committee. [Interjections.] These hon members have a responsibility to participate in the committee, but they choose to go wayward, and we will not be derailed by them.
Siza kwenza umsebenzi wethu apha, asoze silahlekiswe nini ningazazi ukuba nifuna ntoni na. Enkosi. [We will perform our duties here, and we are not going to be misled by the people who do not know what they want. Thank you.]