Reserve Bank warns ANC over spending risks

An ANC spokesperson says government is working to balance cost containment measures while ensuring social assistance does not suffer.South Africa is strapped for cash and the Reserve Bank has a stern warning for the ruling African National Congress: You can't spend your way out of trouble.

Tax revenues fall short of spending and debt issuance to make up the gap has boosted yields. The National Treasury wants austerity measures but faces opposition from others worried about public unrest ahead of next year's election, in which the ANC risks losing its majority."Government spends more than it earns from taxes. We spend as a nation more than we produce.

Likening investor appetite to eating a slice of bread, he said they'll want a spread"whether it's butter, jam or whatever" and it will get pricey if the fiscal picture darkens.

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