In keeping with previous years, a smiling, and cash-in-pocket Finance Minister Trevor Manuel presented an expansionary budget to South African President Thabo Mbeki and members of Parliament in Cape Town on Wednesday.
South Africa is now effectively raising as much income tax revenue from companies as from individuals. This is really rare - possibly unique - within developed or semi-industrialized emerging market nations.
Seven years of economic growth and a decade of sound fiscal policies lead to Minister Manuel announcing massive increases in spending and the proposed introduction of a state pension fund by 2010.
There was also an announcement of the proposed relaxation of exchange controls governing the rand market and outward investment by local firms.
And the2007 Budget, well there was some tax relief for individuals; secondary tax on companies was been amended and the so called sin taxes signified the annual increase in cigarettes and alcohol.
As expected the state will be spending a large amount of money R13.3bn ($1.87bn) over the next three years on the 2010 Soccer World Cup, bringing the total contribution from national government to R17.4bn ($2.44). R8.4bn ($1.18bn) - for stadiums and R9bn ($1.27) for transport infrastructure.
To deal with crime, the Safety and Security budget is set to increase to R43, 6-billion ($6.14 bn) by 2010. According to the 2007 estimates of national expenditure, by that year there will be 190 000 police officers patrolling South Africa's streets.
“Long term sustainable solutions lie in addressing the causes of crime and the conditions that give rise to the alienation of some of our communities”, Manuel said.
Spending on dedicated HIV/AIDS programes by national and provincial government departments will exceed R5-billion within the next two years, according to Wednesday's 2007 Budget.
But it was his underlying message and warning – Human life has equal worth, which overshadowed all the numbers. It reminded everyone that this is what the 2007 Budget was about - to ensure that the better life would truly be shared by all.
South Africa has been enjoying a great economic growth phase, with rising living standards. Much of the credit for that lies with the sound economic and financial base laid down by Trevor Manuel and Reserve Bank Governor Tito Mboweni, not forgetting the leadership role of President Thabo Mbeki.
