Communications Workers Union Reaction to Budget Speech

Communication Workers Union (CWU) notes the presentation of the 2019 Budget Speech (yesterday) by the Minister of Finance, Tito Mboweni. As expected, the speech was disappointing and lacked vision as well as a sense of interest on worker’s issues. The speech lacked inspiration and continued to erode the confidence from the masses of our people except for a few privileged rich white families as well as the recently added black elite families, as they continue to suck all of South Africa’s wealth subjecting the poor to the worst economic conditions. We were promised a New Dawn, where the triple challenges of Unemployment, Poverty and Inequality should have been addressed in ushering radical economic transformation. It appears that we are heading in the opposite direction.

The Budget Speech served as an opportunity for the Minister to reassure the working people and poorest of the poor to continue voting for the ANC in the upcoming National Elections. Instead, workers were smeared with insults as their gains were attacked through threats of retrenchment, budget cut, converted and decorated privatisation of State Owned Entities (SOE’s). These are some of the pure reflections of the long grandstanding, liberal and conservative austerity measures. 

It is advisable to accelerate inclusive economic growth and job creation. The relaxation of VISA for foreign investors is welcomed. We want to caution the Minister that Foreign Direct Investment is what we need. However; they should be guarded against being used as a tool to stifle our country into external political affairs as well as potential State Capture. We urge the government to further encourage domestic investments.

On Tax Revenue and raising SARS capacity, we welcome the introduction of Units that seek to focus on illicit activities like illegal cigarette smuggling and corruption. This is one of the very few things that stands out in the Speech. We still oppose VAT increase, we urge a review into the VAT increase as it impacts on workers and the unemployed negatively. The Minister continued to attack the working class by announcing shrinking tax-free threshold for personal income, instead of introducing a “wealth tax.”

The speech failed to inspire hope as there seemed to be no clear-path in outlining of how hard-earned monies of South Africans collected by SARS would be spent. The Minister announced intentions to build a new National Museum, National Theatre, et al. This is inconsiderate as there are deep impacts of apartheid legacy in our society. The majority of South Africans can hardly afford to watch a show at a theatre. Our people, in particular, those who are trapped in poverty lines, have no extra-mural activity apparatuses in their neighbourhoods. As such, these state-of-art facilities shall continue to serve children of the privileged few. Instead, the government needs to go to the rural areas like Tzaneen, Mzimkhulu, Ntabankulu, Maluti and others to introduce alternative art forms, provide facilities and training in order to develop world-class artists and performers from all over South Africa; from all walks of life. We need to continue in supporting the existing theatres and other such entities. 

The clandestine continuation of, “willing buyer, willing seller,” policy in terms of Land Redistribution, is contrary to ANC’s 54th National Conference resolutions, reflecting on how the parliamentarians deployed by the ANC continues to undermine the party’s own position. The ANC was and remains resolute on expropriation of land without compensation.

Reconfiguration of State-Owned Entities

We reiterate that the call to review the State Owned Entities (Eskom, Telkom, SAA, DENEL et al) is ill-informed. The Minister argues that it is time we move from expenditure to investment, without reinvestment to societal development. This is an indication that the Government intends to privatise these strategic entities that continue to serve South Africa at affordable fees/rates, and employ as many workers as part of the developmental state’s agenda. Only a day before this Budget Speech, our fears were confirmed by the announcement that South African Airway and DENEL will join the “unbundling” bandwagon.

It continues to boggle the minds of many as to why other key stakeholders like labour were not consulted when the decision to unconditionally unbundle ESKOM was taken. This is an indication that there is absolute exclusion and non-consideration of workers and their representatives’ inputs in these critical processes and decisions. We oppose unbundling because we oppose privatisation!!!!

CWU welcomes the resolution by the national government to raise the proposed rapid administrative takeover of Provincial Governments that are not performing. This will not only assist in preventing deepening public maladministration. This also imposes pressure on potentially relaxed provincial administrators to pull up their socks and prevent the rapid takeover. It is also commendable that Chief Reorganisation Officers (CRO) shall be considered for Provincial and Local Governments that are not performing and need intervention. The introduction of CRO in the SOE’s is equally welcomed since the enemy of the growth and self-sustaining entities is corruption, maladministration and irregular expenditure and therefore close monitoring is commendable. 

We further welcome the initiative of a program that will focus on maintaining and sustaining the existing infrastructure. The negligence of our infrastructure turns to be costly not only financially but also puts at risk the lives of those using such facilities. The Bank of Lisbon building saga that led to three workers losing their lives is one of the many examples. In the South African Post Office, workers are forced to work in unbearable conditions that cause a health hazard. This has led to Post Office abandoning some of its own buildings and opt to go renting expensive spaces in the malls and other facilities. 


With the unemployment rate at around 27% (over 9.3 million people), the Speech did not provide solutions, vision, courage, nor desire to attempt in providing solutions for poor households and it has potential to deepen social injustice. Instead of tangible and practical instruments and mechanisms to curb the triple challenges faced by South Africans of poverty, inequality and unemployment as well as providing security for the employed; the Speech reflected a hallmark of job losses, deepening unemployment and poverty. The privatisation of State Owned Entities (Eskom, SAA and Denel of late) sugarcoated as unbundling, shall serve nothing but lead to job bloodbaths and further enriching the already wealthy few. We feel no sense of urgency, no vision of State-building, Nation-building and encouragement towards social prosperity as advocated by ANC-led Government.

We are of the view that Minister Titus Mboweni’s answering to the name Tito was a huge mistake as he leads a different life to that of the original bearer of the name-General Tito, leader of Soviet Slovakia. General Tito considered the masses and workers in general first before profit. He understood the need to uplift social challenges before expecting all forms of prosperity as rushing would further divide society on economic statuses of each section in the society. Instead, the Minister has never been Pro-Worker but Pro-Capital. He has been a part of the government for a large part of our new dispensation as either Minister of Labour, Governor of Reserve Bank as well as Minister of Finance in this tenure. He has been in the forefront of what the South African Communist Party coined as the 1996 Class Project. In his speech, there are alarming warning signs of the re-emergence of the 1996 class project that advocates for neoliberalism. 

We believe that the budget speech failed alliance partners, in particular, COSATU for their relentless opposition to the relaxation of Exchange Controls for 12 years prior to the 2008 Financial recession. He claimed victory, ignoring efforts by alliance partners. He chose not to acknowledge that he once supported the relaxation of exchange rates. We just recently heard Minister defending private ownership of the Reserve Bank; one of the only four Privately owned in the world. He is today, speaking in favour of privatisation of State Owned Entities against the call from COSATU to prevent more job losses. The comment on “Data must fall,” was just pulling wool on our eyes. There is absolutely no direct plan on how to deliver on this question. We had thought that the Minister will use the allocation of the spectrum to force the captains of the industry, in particular, the multinational companies (MTN and Vodacom) to drop tariffs on data, impose a moratorium on retrenchments and create jobs. We expected the treasury to consider tax rebates for Telkom in order to roll out fibre in the townships and in turn; will create jobs, boost the SME’s and improve our communication infrastructure. This would immediately deal with the jobs losses at BCX which is part and parcel of Telkom.

Overall, Communication Workers Union is disappointed yet not surprised by the Speech as we expected such from the Minister who is hell-bent on pleasing the owners of means of control over the Working Class, as well as the poor of the poorest South Africans.

Issued by the office of the General Secretary CWU

CWU General Secretary 
Aubrey Tshabalala
Cell: 061 481 1080