Trevor Manuel: SA finance minister since 1996

Outlining his 2004/05 budget, Mr Manuel announced a 20 billion rand (�1.6bn) public works programme designed to create a million jobs over five years.

He also allocated an extra 2.1bn rand to fund the roll-out of anti-Aids drugs over the next three years.

The new spending plans come two months ahead of a general election pencilled in for 14 April.

Mr Manuel said he expected South Africa's budget deficit for 2004/05 to come in at 3.1% of gross domestic product, down from an earlier forecast of 3.2%, but up from a projected 2.6% this year.

Big spender

He said that while the government was determined to keep borrowing under control, it had not set a specific deficit ceiling.

"What we are saying is we need a fair balance," he told reporters.

Pretoria has raised government spending over the past three years in an effort to revitalise the economy and curb unemployment, estimated at 30%.

The extra government spending, which reverses an austerity drive that lasted for most of the 1990s, has lifted South Africa's budget deficit from just 1.2% in 2002/03.

The government is also prioritising measures to tackle HIV-Aids, which affects about 5 million of the country's 45 million inhabitants.

A survey earlier this year showed that the disease had dented profits at one third of South African businesses through reduced productivity, increased absenteeism, and the loss of skilled staff.

The extra 2.1bn rand in anti-Aids expenditure announced on Wednesday brings total projected spending on efforts to control the disease to more than 12 billion rand over the next three years.

Taxpayer joy

Mr Manuel also announced a surprise 4 billion rand in tax cuts, to be achieved by raising the income tax threshold for lower-paid workers.

The move comes on top of about 13 billion rand in tax cuts during the current financial year.

South Africa has trimmed taxes most years since the end of apartheid rule in order to alleviate poverty, but analysts had expected no change this time.