Hon Deputy Speaker, the former Minister of Finance, Pravin Gordhan, announced the rates and monetary threshold changes during his Budget speech earlier this year, and in so doing granted R9,3 billion in tax relief. Those proposals are being given legislative effect today in the Rates and Monetary Amounts and Amendment of Revenue Laws Bill, and we as the ACDP welcome and support that, as they bring tax relief to individual taxpayers by adjusting the income tax brackets and rebates to compensate for the effects of inflation. Surely that is something that we should all support.
Because we have three Bills here before us, it is quite difficult to know to how to approach them. Let me then say that the key issue of the Taxation Laws Amendment Bill is the postponement of retirement reforms to 1 March 2016, and the postponement of the VAT zero rating of agricultural inputs by 12 months.
The postponement of the retirement reforms is regrettable, hon Minister, although obviously there are reasons for that. We understand there is no consensus at Nedlac. Seemingly, there has been opposition from Cosatu. These delays in our view as the ACDP will aggravate the persistent and untrue rumours that have been circulating about retirement funds. This has resulted in many civil servants, teachers, experienced policemen and nurses resigning, because they are afraid that their pensions are going to be attached, and clearly that is not the case. Therefore, we as the ACDP cannot support this postponement because it is adding to the uncertainty and we need clarity in that regard.
It is also apparent that we are going to have an increase in taxes to be announced in the February budget. We do not know the exact details of that and we look forward to studying the Dennis Davis report.
Cleary we appreciate the fact that a fiscal consolidation path needs to be followed, and that is dependent on economic growth - way above the pedestrian 1,4% that we have at the moment. With any tax reform, one must consider its impact on economic growth. We from the ACDP have clearly and consistently said that we should look at the government expenditure side. As other speakers have said, there is R30 billion's worth of wasteful and irregular expenditure that one can look at. That is an issue we need to look at, rather than tax increases.
Again, much needs to be said about the public sector wage bill. It must come in lower and, Minister, it is obviously a challenge for you. Otherwise, if it doesn't come in lower, we are going to have to either reduce social spending and that on capital budgets, or trim staff numbers.
Minister, last year I raised a concern with the Deputy President about the impact of amendment of section 18A on public benefit organisations. Commentators have indicated that this increased compliance burden will detract from funds. Would you agree to monitor the situation and, should the case of an unintended consequences arise, to relook at that issue?
In view of our reservations as expressed, the ACDP will regrettably not support the latter two Bills, but of course the Rates and Monetary Amounts and Amendment of Revenue Laws Bill we do support. So it is a bit of a challenge when you put all three Bills together. Thank you, Minister.