The Eastern Cape budget is looking nearly half a billion rand leaner after Finance Minister Nhlanhla Nene yesterday slashed provincial budgets by almost R2-billion as he moved to tighten the nation’s belt.
The Eastern Cape, which receives the third largest portion of the provincial equitable share, had its budget for 2014-15 docked from the R52-billion announced in February to R51.7-billion in Nene’s maiden Medium Term Budget Policy Statement (MTBPS).
In a statement that detailed a worsening economic outlook, Nene announced massive cuts, saying “fiscal consolidation can no longer be postponed”.
The cuts, however, weren’t as bad as he made out when he mistakenly announced that provincial budgets would be cut to R469, instead of R469-billion, amid laughter in the house. “That would be a major cut,” he joked.
In addition to tough economic times, there was also more than R700-million worth of unplanned expenses, including a R32.6-million Ebola fund, R67-million for Nelson Mandela's funeral and R65-million for the reorganisation and restructuring of departments after the elections.
Among his “package” to lower expenditure by R10-billion this year and R15-billion next year was withdrawing funding for posts vacant for a long time.
Announcing the provincial cuts, he said “efficiency improvements will be prioristised in the core areas of service delivery – basic education, health, roads and social development”.
And with provinces’ wage bills accounting for 61% of all spending, personnel expenditure would require special attention, he said.
In a media briefing earlier, Nene said finance MECs had all been involved in the budget process and were aware they would have to “take the pain in order to make some fiscal space”.
“We hope provinces will take up this challenge. Finance MECs will table their own initiatives soon.”
And while Nene’s cuts are stern he was adamant they would not affect the poor and unemployed.
He did not mention any specific Eastern Cape projects which would receive funding in his speech, but the MTBPS outlines an amount of R899-million for eradicating the bucket toilet system, which has long plagued the Eastern Cape and other provinces, including Gauteng and the Northern Cape.
This funding, originally allocated to the Department of Human Settlements, has been shifted to Water and Sanitation.
Last month, Water Affairs Minister Nomvula Mokonyane said the R899-million would only allow them to eradicate 30000 toilets.
In the Arts and Culture vote, the Eastern Cape was named – with Limpopo and the Northern Cape – as being slow to appoint service providers.
None of the department’s targeted 45 national library upgrades had yet taken place this year.
Money saved from vacant posts in the Department of Human Settlements has made its way to the Eastern Cape in the form of about R5-million for the Nelson Mandela Metropolitan University.
Nene tightens the nation's belt
The Eastern Cape, which receives the third largest portion of the provincial equitable share, had its budget for 2014-15 docked from the R52-billion announced in February to R51.7-billion in Nene’s maiden Medium Term Budget Policy Statement (MTBPS).
In a statement that detailed a worsening economic outlook, Nene announced massive cuts, saying “fiscal consolidation can no longer be postponed”.
The cuts, however, weren’t as bad as he made out when he mistakenly announced that provincial budgets would be cut to R469, instead of R469-billion, amid laughter in the house. “That would be a major cut,” he joked.
In addition to tough economic times, there was also more than R700-million worth of unplanned expenses, including a R32.6-million Ebola fund, R67-million for Nelson Mandela's funeral and R65-million for the reorganisation and restructuring of departments after the elections.
Among his “package” to lower expenditure by R10-billion this year and R15-billion next year was withdrawing funding for posts vacant for a long time.
Announcing the provincial cuts, he said “efficiency improvements will be prioristised in the core areas of service delivery – basic education, health, roads and social development”.
And with provinces’ wage bills accounting for 61% of all spending, personnel expenditure would require special attention, he said.
In a media briefing earlier, Nene said finance MECs had all been involved in the budget process and were aware they would have to “take the pain in order to make some fiscal space”.
“We hope provinces will take up this challenge. Finance MECs will table their own initiatives soon.”
And while Nene’s cuts are stern he was adamant they would not affect the poor and unemployed.
He did not mention any specific Eastern Cape projects which would receive funding in his speech, but the MTBPS outlines an amount of R899-million for eradicating the bucket toilet system, which has long plagued the Eastern Cape and other provinces, including Gauteng and the Northern Cape.
This funding, originally allocated to the Department of Human Settlements, has been shifted to Water and Sanitation.
Last month, Water Affairs Minister Nomvula Mokonyane said the R899-million would only allow them to eradicate 30000 toilets.
In the Arts and Culture vote, the Eastern Cape was named – with Limpopo and the Northern Cape – as being slow to appoint service providers.
None of the department’s targeted 45 national library upgrades had yet taken place this year.
Money saved from vacant posts in the Department of Human Settlements has made its way to the Eastern Cape in the form of about R5-million for the Nelson Mandela Metropolitan University.
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