Chairperson, it took me half a night to prepare this speech for these hon members. So, I agree with you that I need to have their ears.
Census 2011 also tells us a story of an economic system that is less efficient in the redistribution of wealth; an economic system that has failed the majority of our people, blacks in general and Africans in particular; most dangerously, an economic system that increasingly gives fewer job prospects to young people.
Therefore, the Census results implore us to imagine new economic solutions for a better future. They also oblige all of us to realise the importance of sustainable economic growth over a longer period for wealth creation, and, most importantly, which will then ensure job creation as a fundamental base for wealth distribution.
It is highly critical that the Medium-Term Budget Policy Statement deliberations take full cognisance of the challenges and successes we have had in the past two decades, as revealed by the 2011 Census results. The Census results are not just about population growth. They also reveal startling information on how far we have come in creating a society that has become so highly unequal. Equally, the results tell us a story of resounding successes, particularly in education and health. They tell us of an economic system that has entrenched income inequalities or disparities between black and white - a story of "We have never had it so good like this before." Indeed, it is a story for others that says:
Dit is lekker my kind, ja dit is lekker vir julle mense. Dit is hoekom julle ons maar kan vloek. Dit is hoekom die lede van die opposisie party, veral mev Helen Zille, sonder 'n uitnodiging by die President van die Republiek van Suid-Afrika se private woning kan gaan toyi-toyi, en niks gebeur nie. Dit is lekker vir julle mense, dit is lekker! [Tussenwerpsels.] (Translation of Afrikaans paragraph follows.)
[It is nice, my child, yes it is nice for you people. That is why you may curse us. That is why the members of the opposition party, especially Mrs Helen Zille, can toyi-toyi without an invitation at the private home of the President of the Republic of South Africa, and nothing happens. It is nice for you people, it is nice! [Interjections.]]
Yes, it has been so nice for you. It has been so nice for you.
In our comfort and discomfort, the key question confronting us is what the price will be to reverse the inequalities in our society and its unintended consequences.
History has taught us that there are moments in life when people rise to remind their leaders that something is not right, that something has gone wrong and that change is needed. Change in the world economic system is needed, for it has failed the majority of the world's citizens. It has eroded the very fabric of the universal fairness of equality and the redistribution of wealth. Every citizen has the right to participate in the economic system and earn a living.
Today we are called upon to conclude the cycle which we began in February when the Minister of Finance tabled the 2012-13 Budget. Fiscal policy guides government's decisions about revenue, spending and borrowing. South Africa's fiscal policy enables government to deliver on its developmental mandate by providing resources in a manner that is sustainable and that reinforces the stability of our economy.
As we all know, the budget is a function of economic growth that underpins sustainable developmental goals of governments. Therefore, this Medium-Term Budget Policy Statement has based its proposals on the assumption of how the economy might perform globally and locally. Let me use this opportunity to remind ourselves where we started. We said in the fiscal framework and revenue proposals debate on 6 March 2012, that the budget is about growth, job creation, infrastructure investment, education, health care, and better service delivery. In that debate we outlined that growth is not just about the pursuit of faster growth in development, but about the creation of a more equitable future, through investing in the economic and social infrastructure.
As a committee we have had the opportunity during the public hearings to listen to and engage on the proposed revised fiscal framework for 2012-13 as well as for the next three financial years' Medium-Term Expenditure Framework period, and on the assumptions underpinning the fiscal framework within the context of the global and domestic economy with various stakeholders, such as Business Unity SA, the Financial and Fiscal Commission, and many others.
The domestic economic outlook reflects that growth for this year has been revised downwards from the budget forecast of 2,7% to 2,5%. In addition, our budget deficit has been revised upwards to 4,8% of GDP, largely due to lower tax revenues. This, in itself, is not particularly high, given the developmental challenges we face. The real growth in expenditure averages at 2,9% over the MTEF period.
The counterbalance is that public-sector infrastructure investment and the activation of new electricity-generating capacity are likely to see medium- term growth. The obstacles to faster and more inclusive economic growth are primarily to be found in the structure of our economy. These are the challenges in the labour market, the real costs of energy, delivery inefficiencies, skills mismatching, the demands of industrialisation, and the need for a larger and greater emphasis on beneficiation as opposed to export extraction.
The revised fiscal framework is contextualised by cushioning the domestic economy from the global crisis as a key objective. Fiscal discipline is encouraged, and growth in real noninterest expenditure will average at 2,9% a year over the next three years, as I have already said.
This approach is brought about by declining revenue generation ...