Deputy Speaker, the hon Koornhof is correct. Are we ready? No, we are not. This is the time to be fiscally conservative and perhaps just a little bit pessimistic.
The budget policy statement presented by the Minister vindicates the worst concern expressed by the IFP in the past three years. When we predicted that by 2015 our national debt will rise to R1,5 trillion, the Minister mocked us.
We are now confronted with the clear likelihood that by that time the national debt will rise to R1,6 trillion. When we warned the Minister not to rely on improbable signs of an economic recovery and to rather prepare for a prolonged recession, the Minister mocked us as prophets of doom. We are now exactly where we predicted we would be without having taken protective measures.
The state's finances are precarious. Revenues will continue to decrease and we will need to compete to borrow money in an international market where lenders have forced countries to increase interest rates on their bonds and have many choices. This will increase our cost of borrowing and our inflation, and will decrease the capability of our government to manoeuvre. We need to prepare for this. That is the scenario that the hon Koornhof has painted for us.
In the end we will be forced to do what the IFP suggested doing three years ago. That is what the International Monetary Fund, IMF, is forcing Greece to do and is about to force Italy, Spain and Portugal to do. The Minister has hinted to that and has indicated that we have to walk in that direction but has used euphemisms. This detracts from the clear language necessary to ensure that this message sinks into our national psyche and we make the necessary commitment, at both the political and the economic level.
The Minister spoke about moderating expenses which is a euphemism for cutting expenses. That is part of the austerity package that the IMF is recommending to countries which are now where we are moving towards. In addition to cutting expenses, we need to liquidate the many state assets which are not core to the business of government. We need to reduce the state payroll. We cannot put the country's finances in good order for as long as the finances of the state remain in a shambles.
We cannot continue to base politics on providing financial assistance to sectors of our economy which are not viable in international terms. We cannot continue to expand the welfare state, not because we don't want to, but because we don't have the money for it. We must snap out of the illusion that money is unlimited and that, if today's money is limited, we can make up for that limitation by stealing our children's money through borrowing. The situation in Italy and Greece has proven that this cannot work in the long run.
We need to turn the ship around now. The emphasis placed on job creation is necessary and we fully support it. But it is not the only emphasis which our government should pursue. The other important emphasis, which is much more difficult and much more important, is the emphasis on ensuring that the country makes money and that our GDP grows. Thank you.