Chapter

Transforming Fiscal Governance

Tania Ajam and Janine Aron

in South African Economic Policy under Democracy

Published in print March 2009 | ISBN: 9780199551460
Published online May 2009 | e-ISBN: 9780191720376 | DOI: http://dx.doi.org/10.1093/acprof:oso/9780199551460.003.0004
Transforming Fiscal Governance

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This chapter reviews the policies and outcomes of South Africa's fiscal reform since 1994, and explores the main challenges it has raised. Section 2 discusses the improved governance of fiscal policy with its base in constitutional provisions. Section 3 summarizes the key fiscal reforms since 1994. Section 4 examines the performance of national fiscal policy by means of the trends of the main budget indicators, measures of the cyclically adjusted fiscal stance, a comparison of budget projections and actual outcomes, the management and sustainability of debt, and, finally, the contribution of fiscal policy to South Africa's improved macroeconomic stability. Section 5 explores the implications of the vertical fiscal imbalance created by a combination of highly centralized revenue raising powers and increased decentralization of expenditure responsibility to sub-national governments. Section 6 concludes.

Keywords: South Africa; fiscal reform; fiscal policy; constitutional provisions; budget projections; debt; vertical fiscal inbalance

Chapter.  10506 words.  Illustrated.

Subjects: Public Economics

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