UNITED DEMOCRATIC MOVEMENT

MEDIA RELEASE

LOWER BUDGET DEFICIT WELCOMED

STATEMENT ISSUED BY DR GERHARD KOORNHOF, MP
UDM SPOKESPERSON FOR FINANCE

The UDM welcomes the lower than expected budget deficit, at below 2%. We congratulate the Minister and the South African Revenue Service for their continued success in reducing the deficit. These efforts are in line with UDM policy, as expressed in our Manifesto, where we state that the budget deficit should eventually be reduced to zero.

The UDM is of the opinion that government still has a long way to go in terms of identifying and terminating wasteful and unnecessary government expenditure.

The interest on debt is one of the largest government expenditure items. By accelerating privatisation and using the proceeds (R18 billion projected for this year) to lower this interest on debt will greatly assist in freeing up more funds.

In this regard we call on government not to delay the privatisation programme by postponing certain aspects (i.e. ACSA or Telkom) or creating new conditions/barriers for privatisation, such as setting limits on the percentage of foreign ownership.

A lower budget deficit leads to opportunity costs that create the scope for increased government spending on social development and uplifting the poor.

Enquiries:

Dr Gerhard Koornhof, MP
UDM Spokesperson for Finance

Cape Town
05 April 2001