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 World's 'biggest welfare state'

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PosOnderwerp: World's 'biggest welfare state'   Thu Feb 18, 2010 6:25 pm

World's 'biggest welfare state'
2010/02/18 11:16:00 AM

Johannesburg - South Africa is the biggest welfare state in the world, economist Mike Schüssler said on Thursday.
"Look at South Africa's dependency ratio - it's three people to one taxpayer and it's unsustainable," he told a post-Budget speech breakfast hosted by Absa and the SA Institute of Tax Practitioners in Johannesburg.
He said Minister of Finance Pravin Gordhan's Budget was conservative - "and financial markets like conservative budgets".
Schüssler welcomed Gordhan's stance on not widening the inflation target.
In his Budget speech, the minister made it clear he had rejected calls from the left to widen the SA Reserve Bank's (Sarb) inflation target of three to six percent and to broaden the Sarb's mandate to include economic growth and unemployment.
"It must be realised that the Sarb and interest rates won't be able to fix everything," Schüssler said.
Turning to the National Health Insurance (NHI) scheme, he said it was clear from Gordhan's speech that not much would happen for the next three years.
"The left don't know how to read an income statement. The NHI scheme will be very expensive," Schüssler said.
- Sapa
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