(Bloomberg) -- South Africa’s Finance Minister Enoch Godongwana outlined the nation’s fiscal parameters as the newly formed coalition government gathered for the first time in a closed-door meeting to map out priority areas from economic reform to investment.
President Cyril Ramaphosa convened the first Cabinet Lekgotla meeting of the government of national unity (GNU) following his party’s May 29 electoral defeat. His executive, which now includes 11 opposition parties, has been meeting in the capital, Pretoria, to formulate policy priorities which he will outline during the opening of parliament on Thursday.
Godongwana on Saturday made a presentation in which he outlined the fiscal parameters the cabinet will have to consider as it looks to tackle the nation’s multiple crises, including poor state governance, power shortages and logistics snarl-ups that have hobbled economic growth.
The expansion of the social security net is likely to be one of a number of critical areas that the executive will wrestle with over the next two days, along with the future of state-owned companies, funding to procure nuclear power and the implementation of a controversial national health insurance plan.
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“The GNU is up and alive and working. We are working very hard here,” Ramaphosa said on the sidelines of the meeting. “People are contributing, everyone is talking, so it is a great start to the GNU.”
The president’s opening-of-parliament address will come hours after South African Reserve Bank Governor Lesetja Kganyago is set to announce the monetary policy committee’s interest decision, expected to to be a 25 basis-point cut amid further signs of disinflation in the US and globally.
On the eve of the election, the ANC announced a commitment to finalizing a policy on a basic income grant within two years of returning to power. The Treasury has repeatedly outlined fiscal constraints that make the grant difficult to roll out.
The ANC and its political associates will have to set aside their differences and policy preferences to agree on a common plan which Ramaphosa will present in the coming days.
Ministers from the second largest party, the Democratic Alliance, have already ruffled feathers by communicating positions yet to be signed off by the cabinet and seeking to distinguish themselves from the other parties in the pact. Minister in the Presidency, Khumbudzo Ntshavheni, warned that decisions were taken by members of cabinet and not members of parties.
“We are going to implement government priorities collectively because there is no DA or ANC minister,” she said. “There is a minister of government, and that is what is important. As we deal with issues today, that is what we are consolidating so that we can have a single view and a single program of action that is agreed by all.”
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