Cape Town – The National Treasury has proposed increasing its spending over the next three years on initiatives that will boost job creation, education and skills development.
Finance Minister Nhlanhla Nene announced this when he tabled the National Treasury’s Medium Term Budget Policy Statement (MTBPS) in Parliament on Wednesday.
The mini budget, as it is also known, detailed government’s spending priorities over the next three years, including the proposed division of revenue to provinces.
The Minister proposed expenditure growth of 7.6% a year over the next three years, reaching R1.55 trillion by 2017/18.
“Over the past decade we have increased public spending of the main budget from 26% to 31% of the Gross Domestic Product (GDP). Much of this increase has gone to programmes that contribute to the social wage, including schools, roads, hospitals, housing and municipal services.
“Our medium term objective is to ensure that public spending promotes growth and creates an environment for greater private sector investment,” he said.
Minister Nene said government plans to spend budget on, among other things:
- reinforcing support for export competiveness and job creation. This includes over R18 billion for manufacturing incentives, the establishment of special economic zones and the employment tax incentive;
- supporting cities to improve living conditions, modernise transport and communications infrastructure, expand the urban economy and promote trade and investment. Government will also work with development finance institutions to increase investment in the urban landscape and expand the municipal debt market; and
- expanding the skills base, with R800 billion to be disbursed on education and skills over the next three years. Post-school education and training has received the fastest-growing share of the budget over the past three years, and will continue to expand.
“Alongside these priorities, there will be real growth in spending on local development and social infrastructure. As in the past, the largest allocations will go to education, health and social protection,” he said.
The Minister said one-third of this year’s budget will go to the compensation of employees.
“Over the period ahead, we have budgeted for nominal wage-bill growth in line with consumer price inflation.
“In the present economic circumstances, it is especially important that we maintain a careful balance between personnel spending and other resources required for public service delivery,” he said. – SAnews.gov.za
