Budget 2023: What should SA expect from Enoch Godongwana’s budget speech?

As South Africa eagerly awaits the unveiling of the 2023 budget, all eyes are on Finance Minister Enoch Godongwana as he prepares to address the nation. The country is facing a significant crisis due to ongoing challenges at Eskom, the largest energy supplier, which provides over 80% of the country's power needs. This has put immense pressure on the government to come up with effective solutions. To shed light on the key issues and expectations surrounding the budget, CNBC Africa hosted a panel discussion with Zandile Makova, Consumer Economist at Liberty, Annabel Bishop, Chief Economist at Investec, and Hannes van den Berg, CEO of Consult by Momentum. The experts provided valuable insights into what South Africans can anticipate from the budget speech. The discussion touched upon various critical topics, including the impact of the energy crisis, government finances, consumer relief measures, and the outlook on key economic indicators. Annabel Bishop highlighted the importance of the budget in addressing both national and international concerns. The focus is on resolving the cost of living crisis and managing the country's debt burden, which is considered a significant challenge. The panel discussed the potential impact of taking Eskom's debt onto the government's balance sheet and the implications for fiscal debt and deficit ratios. Lower growth forecasts due to the energy crisis are expected to influence credit ratings and economic performance. With high inflation and rising energy and food costs, the extension of social relief grants is crucial to support low-income households and stimulate consumer spending. There is anticipation that these grants may become permanent or evolve into a basic income grant, reflecting a long-term commitment to social support. Zandile Makova emphasized the importance of consumer-focused measures in the budget. With stagnant wages and inflation outpacing salary growth, tax relief and increased support grants can provide much-needed relief to households. The discussion also delved into the possibility of introducing a solar investment tax incentive to mitigate power shortages on households and SMMEs. The feasibility of such incentives and their impact on government revenue were assessed, with considerations on the affordability and effectiveness of such measures. Hannes van den Berg highlighted the importance of promoting solar energy initiatives at a larger scale to address the energy crisis and provide sustainable solutions for both households and businesses. The potential boost to the economy from tax incentives and increased investment in renewable energy was discussed. In terms of the wider economic landscape, the panel examined the implications of the budget on equity markets and corporate earnings. Despite solid performances in sectors like mining and banking, concerns remain around inflation, interest rates, and consumer spending. The experts highlighted the need for sustainable economic growth and prudent fiscal management to navigate the current challenges. As the nation awaits the budget speech, the discussions shed light on the key themes and expectations surrounding South Africa's 2023 budget.