The MEC for Finance, Economic Development and Tourism, Abraham Vosloo. File picture
THE NORTHERN Cape MEC for Finance, Economic Development and Tourism, Abraham Vosloo, said the Office of the Premier was investigating historical irregular expenditure, which the Province was struggling to contain.
Tabling the Northern Cape Adjusted Appropriation Bill 2022 this week, Vosloo believed that the Province could be debt-free by 2024, provided that no department overspends in the current financial year.
“‘For the 2023/24 to 2025/26 financial years, the total budget of the Province will amount to R62.7 billion,” said Vosloo.
He added that the budget deficit for the 2023/24 financial year would amount to R749 million.
“These reductions were imposed by Cabinet as part of a broader strategy to rein in debt and narrow the budget deficit.”
Vosloo stated that R1.2 billion was allocated to the departments of Health and Education over the next three years.
“Funded priorities at the Department of Health include the compensation of employees, medical supplies, laboratory services, antiretroviral and tuberculosis treatment, goods and services and reducing accruals.”
He indicated that funding was allocated to the Department of Education to cover shortfalls in the compensation of employees, hostel subsidies and to pay municipal accounts.
“The previous years’ reductions were particularly detrimental to the health and education sectors. It affected the functioning of the system dramatically. We are confident that these additional resources will go a long way in stabilising the compensation of employees and goods and services.”
Vosloo added that the Northern Cape’s unemployment rate had decreased to 23.7 percent during the second quarter of 2022.
“The number of employed people and discouraged work-seekers increased by 62,000 and 13,000 respectively, while unemployed people decreased by 1,000.”
Vosloo indicated that R17.5 million was allocated towards providing support to municipalities while R5.1 million was earmarked for supply chain management and revenue-related matters.
He added that a capacity building project would be rolled out at 31 municipalities to address the high rate of supply chain management non-compliance.
“Our municipalities are faced with serious financial constraints that can mainly be attributed to poor debt collection processes and records management. This is symptomatic of inaccurate data and ineffective internal controls within the municipal revenue value chain.”
Vosloo said that R10 million would be set aside by Provincial Treasury to assist local municipalities to effectively collect revenue owed to them.
“This will ultimately improve their cash flow positions and improve service delivery.”
Vosloo added that during the 2023/24 financial year, R15.4 billion would be paid to departments in the form of equitable share and R4.7 billion in the form of conditional grants.
“This leaves a surplus of R30.4 million for the debt redemption strategy of the Province.”
He stated that the adjustments would deal with the projected shortfall in the compensation of employees.
“An additional amount of R307 million is made available for the improvement of conditions of services, of which the Department of Education is allocated R127 million for the wage adjustments followed by the Department of Health with an amount of R101.6 million. The balance of R79 million is proportionally allocated to all departments and entities to provide for the wage increases.”
TOTAL BUDGET: R62.7 billion
Equitable share: R45.3 billion
Conditional grants: R14.4 billion
Social sector: R422.4 million
Education: R249.6 million compensation of employees and related pressures goods and services
Education: R86 million towards the digital curriculum that incorporates multimedia 2D and 3D animations, interactive simulations and virtual experiments
Department of Health: R152.1 million address various pressures especially in goods and services, with R9.2 million rolled over from the previous financial year for the procurement of emergency medical services vehicles
The Department of Social Development: R5.1 million for the employment of additional social workers
The Department of Agriculture, Environmental Affairs, Rural Development and Land Reform: R11.3 million for the revitalisation of provincial nature reserves and the upgrading of various infrastructure
Department of Sport, Arts and Culture: R15.9 million for the evaluation of heritage assets
Roads and Public Works: R80.4 million to deal with the growing rates and taxes debt
Review of Spatial Development Frameworks of eight municipalities: R15 million
Cooperative Governance, Human Settlements and Traditional Affairs: R42.8 million
Office of the Premier: R35.3 million
Provincial legislature: R44.7 million
Department of Transport, Safety and Liaison: R13.4 million
Provincial Treasury: R17.5 million