MAJOR new developments at Coega set to create thousands of jobs were confirmed in Finance Minister Pravin Gordhan’s first Budget yesterday.

The Trade and Industry Department said “an agreement had been reached on the development of a crude oil refinery” in the Coega Industrial Development Zone that would create an estimated 17500 direct and indirect jobs.

The planned Mthombo refinery will be the largest facility of its kind in Africa.

It will cost R66-billion and save South Africa about R18,5- billion a year in imports.

And, the memorandum to the department’s budget tabled in Parliament yesterday said Coega had also “initiated the process of securing an agreement to construct a combined-cycle gas turbine power generator”.

The memorandum says it is projected the Coega Development Corporation will attract investment of R25,5-billion over the next three financial years, creating 1400 jobs.

Presenting his Budget yesterday, Gordhan provided a basket of good and bad for the man-in-the-street.

There was some tax relief mainly aimed at the lower-income groups that would cost the fiscus R6,5-billion, and increases for welfare recipients. But against that the petrol levy was raised by 25,5 cents a litre that will inevitably drive up the price of food.

Gordhan has also introduced a tax based on the amount of carbon vehicles emit per kilometre.

In addition, the minister announced:

An end to SITE (Standard Tax on Employees);

Cigarettes will cost R1,24 more per packet;

Alcohol is up by between 6,5c (a bottle of beer) to R2,22 (a bottle of spirits);

An increase in old age pensions of R70 a month to R1080; and

An increase in the child support grant of R10 – slightly below inflation.

Spelling out the challenges facing the country, Gordhan said one in four adults were unemployed and almost half of South Africa’s young people had not found work.

He said income inequality was among the highest in the world with 50% of the population surviving on 8% of the national income.

Closely associated with that, he said, were the social challenges of HIV/Aids – he provided a further R8,2-billion for the rollout of anti- retroviral drugs – TB and high rates of crime, “angry communities” and dysfunctional schools.

The Budget, Gordhan said, outlined several aspects of a “new growth path” including a concerted effort to reduce joblessness among young people, support for labour-intensive industries and sustaining high level of public and private investment and raising savings levels.

In addition, he said, the aim would be to keep inflation low, raise productivity and competitiveness and improve the “performance and effectiveness of the state”.

Gordhan also signalled the intention of the government to intervene in provinces failing to deliver, saying a mechanism would have to be found to ensure “the constitutional entitlement of citizens to education and health services”.

And he also indicated that the high salaries of officials in state-owned enterprises were a target.

“Too often the culture in the public service and state-owned enterprises is to ratchet up salaries, spend on frills, travel in luxury and spend more on marketing the agency than in fixing the service,” he said.

He said a comprehensive evaluation was being conducted of several key spending areas with a view to “eliminating ineffective programmes and generally improving value for money”.

Some agencies, he added, could be rationalised “to see if we can deliver the same service at a lower cost”.