ON THE face of it, the South African budget was "prudent", as one of the ratings agency called it in the face of a deteriorating macroeconomic environment with no immediate shocks.
The speech was the best any finance minister could have given after a turbulent year for South Africa and the global economy. But before we get back to the rest of our lives, we have to consider the likelihood that our tax bills will rise.
Pravin Gordhan basically told the country in the budget that in the not too distant future he will have to make adjustments to tax rates to meet everexpanding expenditure.
Here's an extract from his speech on Wednesday that delivered the warning: "If we succeed in driving growth towards 5% a year and government revenue doubles in the next 20 years, major infrastructure projects and new policy initiatives such as national health insurance (NHI) and expanded vocational education will be affordable, with limited adjustments to tax policy. But if growth continues along the present trajectory, substantial spending commitments would require significant adjustments in revenue and reductions in other areas of spending."
What this means is that if South Africa doesn't return to growth rates of 5% a year seen before the 2008 crisis – and soon – the government will have no other choice than to adjust its tax policy.
Depending on where you sit on the optimism scales, achieving such growth rates may be a couple or three years away or something quite unimaginable at this point. By 2015, the Treasury sees growth at only 3.8% – optimistic in the view of most economists.
To achieve such growth levels, Gordhan is hoping that the global economic recovery gets back on track. But there are so many issues within the major industrialised nations that it seems just too far off in the distance to entertain it.
There are many forecasts as to when Europe and specifically the common monetary union will be less volatile and able to produce sustainable growth.
There is a school of thought that it will take about seven years for the US to escape the recession brought about by the 2008 credit crisis. That means the world's biggest economy may get back to normal growth rates only next year or the year after.
But what about the eurozone, a consumer of about a quarter of our exports? It is currently in the grip of a recession because of its sovereign debt crisis.
If it starts to emerge from its slump sometime in the second half of this year, and if I were to follow the sevenyear recovery argument, we could only see growth normalise in 2017 to 2019. It's a scary and very sobering number and best describes the challenges in getting South African growth into the 5% plus region.
There could be an argument that China may be our saving grace, but as we saw last year, a slow Europe has an effect on China's appetite for our raw materials. Domestically, the economy keeps shifting from one crisis to the next. Local businesses aren't investing because of uncertainty that in truth plagues the global economy.
But we keep scoring our own goals, particularly in the mining industry, which to me anyway serves as the bellwether of South African risk.
It is stuck in a production rut, with miners, employees and government still trying to find some common ground to boost output.
Reaching the targeted growth rates that would allow the finance minister space not to tinker too much with our taxes seems almost impossible, especially bearing in mind that government expenditure keeps rising.
NHI, which is an important step to improving healthcare access, is yet another cost to be introduced.
On Thursday, the National Energy Regulator of South Africa awarded Eskom an 8% tariff increase instead of the 16% it requested to fund its capital expenditure, maintenance and running costs for the next several years.
Someone is going to have to fund the shortfall and, as the sole shareholder, the government will be at the centre.
The e-toll saga has taught the government the difficulty of funding infrastructure projects through the user-pay principle. But the country's road network still needs rehabilitation.
It is not a pretty picture. the budget was a warning of darker days to come.
Derby is Markets Editor of Business Day