Cape Town - Cabinet has decided to review the spending of departments, against the backdrop of decreased revenue collection and the bleak economic outlook.
Tabling his department's Budget Vote in Parliament on Wednesday, Finance Minister Pravin Gordhan said South Africa's revenue collection had weakened and spending pressures were increasing as a result of the global meltdown.
He said following a briefing to Cabinet this morning on the fiscal outlook, his Cabinet colleagues were determined to work collectively to review spending plans, to reprioritise the budget, to reduce wastage and inefficiency and to get greater value for each rand spent.
South Africa's economy contracted by an annualised 6.4 signalling a recession while Statistics South Africa (Stats SA) last week announced that 179 000 jobs were lost in the formal sector in the first quarter of the year.
"Our revenue collection has deteriorated in the first three months of this fiscal year. At the moment, we are about R19 billion below our benchmark target for revenue. If the present trend continues, we could be as much as R50 to R60 billion below our target by the end of the year," the minister said.
For this reason, the minister said that government had to spend differently, adding that savings was not only about reducing budgets.
"It is also about combating corruption, wastage and leakage in government. In particular, corruption in our procurement system is of grave concern to us," said Mr Gordhan.
He said work was underway to establish a Supply Chain Management Compliance Monitoring Unit within the National Treasury to root out corruption, adding that public servants must play a role in identifying corruption.
"We call on all honest public servants and the South African public to join us in identifying and rooting out corruption," the minister said.
He said government would increase its spending on public employment programmes, among other things as well as job creation, fighting crime, improving the quality of health.
"We are committed to increasing spending on public employment programmes to ensure that resources are not a constraint to reaching our targets for public works programmes," he said.
The department would also this year provide adequate resources for the country's anti retroviral programmes and to improve the capacity of the country's health system.
"We have also committed ourselves to finding more money for the occupation-specific dispensation for doctors," the minister added.
He added that since government has chosen to prioritise and increase its spending on these key areas, it would have to find savings in other parts of the overall budget.
