By Simon Nare
Gauteng finance and economic development MEC Lebogang Maile has unveiled a five-year budget approach that he believes will facilitate provincial delivery based on the medium-term development plan.
Tabling the provincial budget at the legislature on Tuesday, Maile warned against wasteful expenditure and highlighted how accruals remained a significant threat to Gauteng’s fiscal sustainability and affected spending power.
“With a shrinking equitable share and slow economic growth, Gauteng provincial government departments must internalise these fiscal constraints and align spending with the 2024-2029 Medium-Term Development Plan.
“Failure to act decisively – through expenditure oversight, keeping the overall wage bill under control and exploring alternative funding models – will risk deepening the liquidity crisis, threatening service delivery, and exposing the province to significant governance and fiscal risks,” he said.
The MEC said the five-year plan would be anchored on maintaining fiscal discipline and credibility, impactful service delivery and responding to high-level provincial risks such as safety, economic growth, climate change and debt management
He said Gauteng was the wealthiest province in the country and the region, and this wealth must translate into improved quality of life for its residents.
He added that research by the Gauteng City Region Observatory revealed that a quarter of households in the province still lived in abject poverty. Furthermore, research by various higher learning institutions indicated that a significant number of people experienced food insecurity.
“This illustrates the poverty dynamic in a wealthy region. It is for this reason that in our assessment of the service delivery and poverty alleviation strategies, we are focused not only on analysing the underlying flows, that is, who enters and leaves poverty, rather than just focusing on the stock, which is the number of people living in poverty at a specific time,” he said.
Maile said the global economic environment was characterised by uneven growth prospects for different regions, rising debt levels and geopolitical tensions, including protectionist policies and populism.
He said that according to the International Monetary Fund, advanced economies grew by an estimated 1.7% in 2024, unchanged from 2023. Projections were that growth will improve marginally to 1.9%.
South Africa continued to experience weak economic performance due to structural challenges and logistical constraints. National Treasury projects that the economy will grow by 1.75% in 2025 and 2026 respectively.
Gauteng remains the biggest contributor to the South African economy with the province currently contributing 35% to the National Gross Domestic Product.
“The provincial economy continues to grow above national levels. Our economy grew by 1.3% in 2024. It is expected to rise to 1.8 percent in 2025 before reaching 2% in 2026.
“We are convinced that to deal decisively with the monopoly structure of the economy, we must promote the development of small businesses, particularly township enterprises and cooperatives.
“Over the past five financial years, the Gauteng provincial government has invested a total of R15.1 billion in township-based enterprises owned by Blacks, women, youth, people with disabilities and military veterans through our preferential procurement spend,” he said.
Maile said over the past five years, the provincial government’s own revenue amounted to R36.8 billion, which on average was R7.2 billion per year. He added that in the current financial year, up to the end of February, the province has raised R7.3 billion, which is slightly above the average.
Revenue collection was expected to increase from R8.3 billion in the 2025/26 financial year to R8.7 billion in 2026/27 and reach R9.1 billion in the 2027/28 financial year.
The MEC tabled the provincial budget of R527.2 billion over the medium term.
Maile said it was worrying that infrastructure projects were lagging, which had led to high unemployment.
“Our comprehensive research indicates that not all Gauteng infrastructure projects are economically feasible. Some are not fit-for-purpose while others are sustainable in the longer term in terms of operations and maintenance costs,” he said.
The MEC said the provincial government increase would increasingly focus on infrastructure projects that were not only sustainable, but also directly contributed to an increase in its revenue stream and to economic growth and development.
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