Budget Speech 2014 – An advertising perspective

Posted: February 27, 2014

While the 2014 Budget is being hailed as largely conservative, a pragmatic budget was expected considering this is an election year.  That said, the Minister alluded to some tax relief which will no doubt provide households with more disposable income.  While there were no fireworks in the speech, there are some areas of the budget that bear mentioning. The increased spend on infrastructure development and education, coupled with the R9.3bn in income tax relief to the lower income earners should stimulate certain sectors of the economy in a micro sense.  Entrepreneurs, brands and the advertising and communications sector are well poised to benefit from this micro-economic benefit.  This is a very pertinent area for those in the business of advertising and communications as it presents an opportunity to leverage this windfall.

Aggressive and innovative strategies to stimulate continuous investment into advertising and communications will yield at least sustained, if not increased product sales that will ultimately benefit business and the economy in general.  Whilst some may downplay these opportunities because of the increases in indirect taxes, i.e. the so called “sin taxes” being implemented with immediate effect, rising fuel prices, the fuel and RAF levies, depreciation of the Rand and the introduction of e-Tolls in Gauteng to mention a few, it was very encouraging to hear the Minister note that GDP and Export growth are expected to grow positively over the next three years. It is this growth that will continue to stimulate the recessed economy and the very growth that will challenge those in the business of advertising and communications to achieve the ‘balance’ referred to by the Minister in his budget speech. ‘Balance’ means balancing the needs of government (read brands) with the needs of the country and its citizens (read consumers) to ensure responsible and meaningful advertising and communications initiatives to assist brands and consumers alike.

The ACA is the official, representative body for the Communications and Advertising profession in South Africa, representing agencies in the profession (who at present contribute approximately 95% of South Africa’s measured ad spend) to government, media and the public. The ACA is a voluntary body formed by and for the industry, focused on and committed to self-regulation and to defending the highest standards of ethical practice.