Trevor Manuel is arguably the best finance minister in SA's history, and the longest-serving (13 successive budgets) after Klasie Havenga (1924-1939, 1948-1954). Some of Manuel's 17 predecessors served just one or two years; many were undistinguished; and none achieved the kind of influence that he has steadily accumulated since succeeding Chris Liebenberg in 1996. There has certainly never been a triumvirate in our history to match Manuel, Reserve Bank governor Tito Mboweni and SA Revenue Service commissioner Pravin Gordhan.
Judging by repeated, albeit subtle, signals from both the ruling party and himself, this was probably Manuel's last budget - though in politics one can never be sure.
In his 2009 budget address, Manuel provided some of the direction and leadership that caretaker president Kgalema Motlanthe was unable to offer in last week's rather sad state-of-the-nation address. Manuel offered an overdue antidote to the hysteria that has been generated by the global financial crisis. Leaning heavily on his established strengths - cool analysis, accessible language, reference to underlying values and relentless logic - he was able both to reassure and warn.
He made it clear that the prudent, conservative economic policies and regulatory regime of the past decade have protected SA from the worst fallout, and that it would be reckless to ditch them. "Reducing the budget deficit was neither easy nor popular," Manuel said. "But it was the right thing to do." If there are those who disagree, they dare not say so publicly. Even those on the left of the ruling alliance were forced to admit that SA has to operate within a global context, and nobody has managed to refute treasury's arguments.
It seems hard to imagine now, but Manuel's critics were once to be found on all points of the political spectrum. When he referred to "amorphous markets", soon after his appointment, he was mocked; free-market ideologues used to howl for the total abolition of exchange controls.
Perhaps amorphous was the wrong word, but Manuel has certainly been vindicated by the growing consensus that markets need better regulation. And it was because our banks were not allowed to invest abroad in dodgy subprime securities that we escaped the worst.
Manuel learnt fast in the job, and just as quickly he developed the self-confidence to chart a course that depended on values, global best practice and technical factors, rather than internal ANC politics. He was lucky that he could consolidate his position with the unequivocal backing of the president, when Thabo Mbeki was still politically untouchable. And Manuel had the true leader's gift of surrounding himself with people who knew a lot more than he did.
The paradox of the 2009 budget is that it may have taken a global crisis to save the Mbeki/Manuel fiscal and monetary legacy. The new ANC leadership were looking forward to splashing out with the surplus that they so resented; now they contemplate a growing deficit. They are fearful, and look at Manuel with new respect. The spending priorities - education, health, poverty relief - remain and are aligned with party policy, but the room for manoeuvre has suddenly disappeared.
The core theme of this budget is actually not the allocation of money, but how it will be spent. If you looked just beyond Manuel's cultivated manner, you saw his outrage. It was as if he was saying to the rest of government: "We have done our job. We have collected the money and managed it carefully, and allocated it where it is needed. But you have wasted it, stolen it, failed to spend it."
He spoke of "insufficient control" of travel, advertising, PR and consultants, and of the need for stricter oversight of pay at parastatals. He launched a thinly veiled attack on how his fellow ministers run their shops; of the R1,6bn that taxpayers must now add to previous bailouts for SAA, Manuel noted sarcastically that "I am sure the House will agree with my hope that this will not be a recurring allocation". Demanding better value for taxpayer money, Manuel called on the new administration to do a comprehensive expenditure review to ensure that "as we spend more, we also spend better".
Everyone has been wondering whether Manuel's successor, whoever it is, will have the personality, the intelligence and skill, the sheer political clout to prosecute the policies that are right for the country. And if the ANC retains power in the April general election, will its allies in the SACP and Cosatu be able to question the barriers to competitiveness, and resist the urge to insist on over borrowing? There will obviously be a new dynamic in the relationship between treasury and the presidency, and we cannot tell how it will turn out.
So there are many imponderables, and one is reminded of the story of the old man who said: "I have worried about a great many things in my life, and most of them never happened." Whatever the composition of the new leadership, we have to assume that they agree with Manuel on the need for improved delivery.
Manuel has been a good finance minister - and the 2009 budget confirms this - because he walked the tightrope of competing interests while doing what he knew was right. But his greatest service is that he has reminded government that it is not policy and ideology that count, but action.
There is a sense that for several years to come, whoever is finance minister, all the budgets are still likely to be Manuel's, such will be the force of his legacy. But that will not matter if government does not clean itself up and start delivering.
Ranking the Analysts 2009
