S. Africa Allots $315 Million for Blacks; Budget ‘Insensitive,’ Critics Say

The South African government announced Monday that it will spend about $315 million in the next year on rural development, job creation, new urban housing and other special programs for blacks in an effort to curb the country’s continuing civil strife.

In his annual budget speech, Finance Minister Barend du Plessis told Parliament in Cape Town that the government wants to give people, particularly the nation’s 25 million black majority, “a chance to get going and keep going” and through economic growth to help solve the country’s present crisis.

But as a down payment on President Pieter W. Botha’s promises of sweeping political, economic and social reforms, Du Plessis’ $18.8 billion budget, an increase of about 14% over the past year, was described by the government’s critics as a major disappointment, a failure to commit substantial resources to restoring stability to the country.

‘Insensitive’ Budget

“It’s a rich man’s budget,” said Clive Weil, managing director of a large supermarket chain. “This is a budget for those who have jobs and who are earning salaries. . . . I believe it is insensitive to the needs of the majority of our population, insensitive to the people who are really battling to make ends meet, particularly to those people who are unemployed and have no job prospects.”

Harry Schwarz, spokesman on economic policy for the opposition Progressive Federal Party, a liberal white organization, commented, “One sees nothing in this budget that shows imagination and realism to deal with the major threats to stability in the country and with the serious economic problems that threaten our ever-increasing population and its legitimate expectations.”

Du Plessis defended the modest increases in programs for “black upliftment,” as the government calls them, as all that the country can afford after two years of severe recession, with a maximum economic growth of 3% projected for the coming year.

“Sound principles of finance are a prerequisite for the long-term success of the upgrading project,” he told Parliament. He said that spending more would increase inflation, now running at 21% annually, more than twice the rate of a year ago, and add to the economic burden of blacks.

Rural Development

About half of the $315-million budget for upliftment will be spent as part of a $500-million, three-year rural development program that Botha announced in January. Most of the rest will go for new black housing and other much-needed improvements in the country’s urban black ghettos and in the process create tens of thousands of construction jobs, Du Plessis said.

The government plans to increase spending on black education by 28%, but the total outlay of about $355 million is only about 11% of the total education budget of $3.1 billion, the biggest segment in the budget.

Similarly, the $156 million budget for urban black housing, where there is an acknowledged need for 222,000 new homes, is less than half the total state housing budget, which allocates more to construction in white, Colored (mixed-race) and Indian areas.

Pensions paid to black retirees under the new budget will be increased by $9 a month to $49, but that is still only half what the state pays to whites.

Subsidy Phase-Out

Meanwhile, the government will begin phasing out its $100 million a year bread subsidy, which largely benefits urban blacks, by reducing its outlay by $25 million next year.

“This is a white man’s budget,” John Simpson, an economist at the University of Cape Town, said. “Blacks do not get the same benefits, either individually or as a community. Whatever blacks may get is preceded by even greater allocations on whites. . . . That is hardly new, but the government should not pretend there have been sweeping changes.”

To encourage modest economic growth and provide relief for the hard-hit white middle class, Du Plessis said the government will reduce income taxes by eliminating a special 7% surcharge and reducing net taxes a further 5%.

Despite the continuing civil unrest, defense expenditures, about $2.8 billion, will remain at about 14% of the budget, Du Plessis told Parliament, and the police budget will be 3% of the total.

Three blacks, meanwhile, were reported killed in further civil unrest around the country. A black man was shot to death by a white farmer who opened fire with a pistol on a group he said had surrounded his car near Tzaneen in northern Transvaal province and begun to stone it.

The bullet-riddled body of a black policeman was found in his home in Mamelodi, outside Pretoria, where police and black youths fought a running battle most of Sunday. Residents said the policeman had probably been killed as a government collaborator.

Another man was killed near Knysna, a resort town on the country’s southern coast, when police fired shotguns at a mob stoning their vehicle, police headquarters in Pretoria said.