Gauteng budget aimed at stimulating growth

Tuesday, March 6, 2018

Gauteng Finance MEC Barbara Creecy on Tuesday presented the 2018/19 provincial budget, which details how available resources will be used to fund key priorities, while kindling economic development.

MEC Creecy said the Gauteng Provincial Government budget is R121 billion. This year alone, the province will add R9 billion to departmental baselines, which is a huge increase under the current difficult global economic circumstances. The province also aims to collect R6 billion in own revenue.

The province receives R114.9 billion in the form of transfers from national government in 2018/19. The equitable share is R93.4 billion and conditional grants equal R21.5 billion.

Tabling the budget at the Legislature, MEC Creecy said the budget is in line with the new dawn identified by both President Cyril Ramaphosa and Premier David Makhura.

“Our new dawn is based on the reality of recovery in the global and domestic economy. At an international level, there are improvements in investment, trade, commodity prices and business and consumer confidence,” the MEC said.

World growth is expected to reach nearly 4% this year, while growth in emerging markets will reach nearly 5% with healthy trends expected in China, Brazil and India.

At home, the national economy is projected to grow only by 1.5% this year. Inflation has stabilized, the stock market has risen, the Rand has strengthened and there is a welcome recovery in investor sentiment and business confidence.

However, MEC Creecy said despite the improvements, municipal finances also face rising debt levels due to high levels of unemployment and increased demand for free basic services without commensurate increases in revenue.

With the current high levels of migration to Gauteng‚ health and education would still face spending pressures.

Budget breakdown

Detailing the R121 billion, MEC Creecy announced that in the coming 2018 Medium Term Expenditure Framework (MTEF), R31.8 billion will be set aside for infrastructure. This allocation will be invested in different development corridors over the next three years.

In pursuit of the goal of making Gauteng a Global City Region, the province has reconfigured its space and economy along five development corridors, each with its own unique comparative and competitive advantages.

The corridors are configured as follows: Northern Development Corridor is anchored on the economy of the City of Tshwane, while the Southern Development Corridor is anchored in Sedibeng. The Central Development Corridor is anchored on the City of Johannesburg, the Western Development Corridor in the West Rand and the Eastern Development Corridor in Ekurhuleni.

MEC Creecy said in the upcoming term, R3.9 billion will be set aside for the Southern Corridor, R3.5 billion for the Western Corridor, R4 billion for the Eastern Corridor, R6.1 billion for the Central Corridor and R5.1 billion for the Northern Corridor.

The Department of Human Settlements will receive just over half this budget, an amount of R16.2 billion. This will include the renovation and upgrading of community residential units, commonly known as hostels.

“Over the MTEF, we are setting aside R666.5 million towards this program. In the current financial year, we will be spending R279 million for upgrading and renovating 17 hostels. We have also allocated the department R43.7 million to settle debts owed to municipalities in provincially owned hostels,” MEC Creecy said.

Big plans for transport, business development

The Department of Roads and Transport will receive R6.4 billion in infrastructure money over the medium term.

The most significant project to start in the design phase this year is PWV 15, the first brand new Gauteng Highway to be built since the 1970s. The 35km-long PWV15 road will support the proposed development of an aerotropolis at OR Tambo International Airport and the Tambo-Springs freight and logistics hub.

The Department of Economic Development, which continues drive economic recovery, reindustrialisation and transformation, has been allocated R1.5 billion in 2018/19 financial year.

This will be used for the expansion of the Automotive Supplier Park, upgrading of township hubs/industrial parks, small business development at the Gauteng Enterprise Propeller as well as Tshwane Innovation Hub, which implements programmes such as Start-up Support for township companies.

To support the ongoing provincial modernisation drive and continue to connect all government institutions to the broadband network, MEC Creecy said the Department of e-Government is allocated R1 billion over the next three years.

The Agriculture and Rural Development budget grows from R957 million in 2018/19 to over R1 billion in outer year of the MTEF. An amount of R421 million is set aside for Agriculture and Rural Development.

This money will be used to finance key projects in agro-processing and Agri Parks (which get R68 million); R92.3 million for farmer support and development programmes, including fencing, boreholes, piggeries, broilers, layers, fertilisers, pesticides, implements and seeds; R21.8 million for the roll-out of the Community Vets Programme to support small and emerging producers and R30.2 million for community, backyard and school food gardens.

Sizeable share for education, youth  and health

The Department of Education will get R45.2 billion, with key allocations for Early Childhood Development (ECD) sites and special schools, hot meals at school for learners and transport for learners who live more than five kilometres from the nearest school.

The continued rollout of the e-Learning strategy, textbooks, stationery, school furniture, teacher development and support initiatives will also be high on the priority list.

The province’s youth will also benefit from the allocation of over R500 million for youth development initiatives such as R117. 4 million for Tshepo One Million; R17.8 million to the Expanded Public Works Programme to create 3 000 work opportunities and R76.8 million for the National Youth Service programme, which includes Zivuseni.

In addition to this, about R261 million will be used to provide 3 000 bursaries, learnerships and scholarships to universities and TVET colleges; R186million for government internships; R50.9 million for the Accelerated Youth Placement Programme, hosted by the Department of Economic Development and R43.7 million for the Welfare to Work Programme, which will help a further 34 774 women, including single mothers, move from dependence on child care grants to sustainable self-supporting economic activity.

The provincial Department of Health received the biggest slice of the provincial budget with R46.4 billion‚ about 38% of the total budget for the 2018/19 financial year.

Gauteng Premier David Makhura has set up a special task team to help turn the Health Department’s finances around.

Social development, community safety

An amount of R4.9 billion has been allocated to the Department of Social Development, which will help many households that are dependent on support from poverty alleviation programmes such community based care facilities, services to people with disabilities and food parcels for the poorest households.

An amount of R245.9 million over the 2018 MTEF is set aside for the expansion of the Isibindi programme and the prevention of violence against women.

The Department of Sports, Arts, Culture and Recreation -- which leads the campaign to promote nation building and social cohesion -- has been allocated R942 million.

The Department of Community Safety receives R49 million this year to improve community-centred policing, which includes Community Policing Forums (CPFs). A further R65.6 million is allocated over three years to fight crimes against women and children and R121.9 million to reduce road fatalities through targeted law enforcement operations.

MEC Creecy allocated R528 million to pay municipal bills at no-fee public schools. She said the Grant Committee will continue to be an interface between departments and municipalities in fast-tracking payments and resolving disputes over municipal debts.

An amount of R23 million is allocated over the MTEF to the Office of the Premier to continue strengthening the fight against corruption through the Integrity Management Programme.

The Provincial Treasury receives an additional R23.6 million over the 2018 MTEF to fund probity audits to improve transparency in government procurement processes through the open tender process.

A further R29 million is allocated over the 2018 MTEF to provide for in-house and independent forensic investigations. –

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