SA municipal union welcomes new ministers, wants VAT increase scrapped

Newly appointed South African Finance Minister Nhlanhla Nene should ensure that the increase in value added tax (VAT) announced in the 2018 Budget last week is not implemented, the South African Municipal Workers Union (SAMWU) said on Tuesday.

Nene, fired as Finance Minister by former President Jacob Zuma in 2015, was returned to the post in a cabinet reshuffle announced by Zuma's successor Cyril Ramaphosa on Monday night.

"We welcome the reappointment and return of Finance Minister Nhlanhla Nene, first on the agenda for Minister Nene should be ensuring that the VAT increase from 14% to 15% is not implemented," SAMWU general secretary Simon Mathe said.

"The working poor just do not have the extra money and as such are unable to catch up with the forever rising cost of living. We also join calls for the expansion of zero rated VAT items, this expansion should include the daily needs of South Africans."

Mathe said Ramaphosa needed a strong team to help him restore the confidence of South Africans in their government, which he said had "evaporated in the last few years".

He urged Nene to work together with new Cooperative Governance and Traditional Affairs Minister Zweli Mkhize to ensure that the needs of municipalities were prioritised.

"Municipalities should receive a fairer equitable share that would enable them to deliver quality services to South Africans. Government expenditure should be aligned with the needs of South Africans which are mostly at local level," Mathe added.

Nene should resist the temptation of pre-empting the outcomes of salary and wage negotiations, he said.

Mkhize was inheriting a dysfunctional department and should urgently put in place a team which would attend to the challenges facing municipalities including management issues, failure to pay workers’ salaries on time, corruption and maladministration, Mathe added.

Mkhize and Nene were expected to be sworn in as members of parliament later on Tuesday, together with David Mabuza who is set to become Deputy President, and Reginah Mhaule who has been appointed Deputy Minister of International Relations and Cooperation.