KZN to give back over R6bn to national government for Covid-19 relief funds

The KwaZulu-Natal government will repurpose its budget and return R6.21bn to the national government for the 2020/21 financial year as part of its equitable contribution to the “extraordinary coronavirus budget” of R500bn injected into the economy. 

President Cyril Ramaphosa announced a R500bn relief package to combat the pandemic, allocate money for municipalities for provision of services, issue grants to relieve the plight of the poorest, fund job creation, provide tax relief for distressed businesses, provide assistance for spaza shops and small businesses, and to be used as a loan guarantee scheme for qualifying businesses.

Of the R500bn, R130bn will be funded from within existing government financial resources.  

"The national departments will contribute R100bn, while all nine provinces will contribute R30bn. This means that from the existing baselines, KZN has had to reprioritise its budget to fund the required programmes to respond to the Covid-19 pandemic. Using the provincial equitable share formula, KwaZulu-Natal’s contribution to the R30bn is R6.21bn for the 2020/21 financial year," said premier Sihle Zikalalala.

Zikalala delivered the 2020/2021 budget policy speech on Tuesday. He announced that the provincial government will be identifying these funds and returning them to the national government towards the response package announced by Ramaphosa.

Zikalala said the pandemic had wreaked havoc on the budgets of departments, and the province has had to embark on unprecedented and unforeseen interventions to repurpose money.

He said the prioritisation process has taken "due care to exclude the departments of health and education, and to a limited extent the department of social development" as these three lead the government response to Covid-19.

"We are expecting  the annual performance plans prepared in line with the tabled budgets will be revised to align to the reprioritised budget. A special adjustments budget will be tabled by the minister of finance in due course and we will also follow suit as the province of KwaZulu-Natal," said Zikalala.

The province's R800.2m budget consists of R136.1m allocated for administration; R226.5m for policy and governance; and R437.5m for institutional development.