EASTERN CAPE R48, 223 BILLION BUDGET: THE LEAN YEARS ARE UPON US

The fat years are over and the lean years are upon us. The Eastern Cape budget announced today (subs: Wed, 3 March) is not innovative enough to meet the fiscal challenges this province is facing. The Democratic Alliance would have expected Public-Private Partnerships to be highlighted in the budget speech of the Finance MEC as a means of funding the backlogs in this province and improving service delivery.

The crunch-issue in the Eastern Cape is value for money and expenditure. One would have expected an announcement to be made in relation to invoking the stringent provisions of the Public Finance Management Act against those officials who mismanage our scarce resources.

There was also no mention of leveraging our key resources such as land and budget to deal with capital infrastructure and attracting investment.

The initial R403-million which has been identified from non-core items in the 2010/2011 budget can be drastically improved. The DA in the Western Cape has identified R2,1-billion in savings over a three year period – on a smaller budget. Given the fact that the government committed itself to an austerity campaign in November at the DA’s urging, we would have expected this amount to be higher.

The MEC correctly touched on the need for tender reform but failed to announce that a Bill could be introduced to ban provincial employees from trading with the province. This is something the DA is doing in the Western Cape.

The announcement that the budget has increased by 14,2 % is misleading, as the conditional grants of R7, 453 billion increased by 27 %, which accounts of the bulk of the increase. The real increase in direct equitable share after top-slicing R900 million of debt is at very best 7%. The wage settlement that is agreed on this year will have a critical impact on service delivery if it runs above inflation.

We welcome the fact that 82% of critical posts in Health will be filled this year and the commitment to access R2, 5 billion outside of the budget to eradicate mud-structure schools.

We are concerned that very little was said about dealing with the roads backlog in this province and if one compares the budget of Public Works, Transport and Roads with last year’s budget, there is no increase. The fact that Housing increases by 23% is welcomed.

For further information, please contact Bobby Stevenson, MPL on 082 775 3444.