Presidency gets R12.6bn for job creation in Mboweni's mini-budget
Treasury is adopting zero-budgeting process where departments have to justify each programme they want to spend on
The National Treasury has called for “high-level policy discussions” on the size of government departments and public entities, financial support to students in the higher- education sector, housing delivery programmes and subsidies for urban transport modes.
It also wants urgent talks on containing the public sector wage bill.
The Treasury has since June this year conducted more than 30 reviews of government spending with a view to increasing the efficiency of the state. Preliminary findings show that:
- many policies are designed and adopted without considering their total costs and affordability;
- multiple institutions share overlapping responsibilities, or mandates, leading to a duplication of work; and
- in several high-spending procurement areas, including information technology and communications technology, the government is overpaying for goods and services.
“Spending on government programmes has exceeded annual revenues for more than a decade. The persistent gap between spending and government revenue requires difficult decisions about the structure, effectiveness and affordability of certain programmes,” it said.
The Treasury is adopting a zero-budgeting processes where government departments have to justify from scratch each programme they spend on to determine if it provides value for money or should be scrapped.
Learning and culture continue to receive the highest allocations of the government’s consolidated spending of R2.1-trillion in the 2020/21 adjusted budget. The sector receives just R400bn, which will go towards improving basic education, post-school education and training, arts, as well sports and recreation.
Economic development and community development received the biggest increase in allocations at 4.6% and 4.3% respectively to make up for increased spending in upgrading infrastructure and expanding access to basic services such as water.
Other in-year adjustments include an additional R36bn towards Covid relief interventions announced in 2020, while Eskom gets R23bn it is due as part of R350bn in government guarantees. SAA gets R17bn to pay its debts and implement a business rescue plan, and the Independent Communications Authority of SA (Icasa) gets R84.7m to begin licensing high-demand spectrum.
Meanwhile, the presidency has scored R12.6bn to address youth unemployment. Of that, R9.9bn goes towards the employment of 344,000 unemployed youths who passed matric, as school assistants about the country, R1.9bn to create work opportunities in line departments, R1bn to retain self-employed food producers in the agricultural sector, R630m for provinces to create jobs through road-maintenance projects, and R393m towards the recruitment of community health-care workers and nurses.
The department of social development has been allocated R6.8bn to extend the special Covid-19 relief of distress grant.
Finance minister Tito Mboweni tabled his medium-term budget policy statement (MTBPS) on October 28 2020. Many called this particular one a 'balancing act' in light of SA's having to rebuild its economy due to the Covid-19 pandemic. Government spending and debt, SAA rescue plan and the State Capture Commission of Inquiry were just some of the topics covered in his address
LISTEN | Dissecting Mboweni's MTBPS with Investec's Annabel Bishop