Your editorial (“Cut budget fat to fund civil service salary hike”, The Herald, September 2) refers:
Your comments with regard to a climate of austerity are spot-on, but it is important to understand the depth of the financial crises facing this province. In a question for oral reply on 25 August the MEC for Finance, Mcebisi Jonas, stated that there is a R3 billion budgetary shortfall that is projected for health and education in the current financial year if nothing was done.
The projected shortfall of R3 billion relates to cost of employment pressures in the area of occupation specific dispensation and conditions of improvement of service for public servants.
On to this one must still add the cost of the strike in terms of increased salary pressures. When one considers that the R2 billion that has to be top-sliced from future provincial budgets to pay for last years’ debt (2009/2010), the magnitude of the financial crisis impacting on the province is horrific.
In addition to a real belt tightening exercise that your editorial alludes to, the following steps need to be taken:
1. The vacancy for the HOD of the Provincial treasury needs to be filled urgently. It has been vacant since December last year and was re-advertised last week.
2. Provincial Treasury needs to provide tough leadership so that sound financial management is restored. We need a Treasury with political and administrative clout.
3. National Treasury must clarify to what extent they will assist the Eastern Cape.
4. A real belt-tightening exercise is needed so only core business is focussed on.
5. There needs to be reform of the tender process as it is estimated that more than 20% of our capital and goods and services budget (R13 billion) is lost through poor administration, over-pricing, poor workmanship and outright corruption.
6. The oversight work of Scopa and the Portfolio Committee of Finance needs to be beefed up. The problem is political and not simply administrative.
If one considers that almost 70 % of the provincial budget (excluding conditional grants) goes to pay salaries, there is not all that amount of fat that can simply be trimmed from the budget. There needs to be a drastic overhaul of how the province’s finances are managed if we are to continue to provide the services that people so desperately need.
Bobby Stevenson, MPL
DA Legislature Leader