THE Gauteng Provincial Government’s budget has increased by R7-billion increase to R149.5-billion, Gauteng Finance and E-government MEC Nomantu Nkomo-Ralehoko announced on December 9.
Presenting Gauteng’s 2021 Medium-Term Budget Policy Statement and the Adjustments Budget, she noted that this budget had been formulated against the backdrop of severe resource constraints and fiscal consolidation measures that were necessary in the short to medium term, and which are expected to end in the 2024/25 financial year.
The 2021 Adjustments Budget continued the focus on four priority areas, namely defeating the Covid-19 pandemic, re-igniting the Gauteng economy, recalibrating social policy and improving governance, she added.
The infrastructure budget has been adjusted to R11.1-billion. Of this, R10.6-billion is allocated to the departments of Human Settlements, Health, Education and Roads and Transport, while the remaining R506.7-million is allocated to the departments of Economic Development, Social Development, Agriculture and Rural Development, Sport, Arts, Culture and Recreation and Infrastructure Development.
“These departments must improve the impact of investment on service delivery and social gains. In March, we highlighted the need to place more focus on making infrastructure affordable and enhance value for money, thus ensuring effective, efficient and economical use of public funds related to infrastructure investments. We still have a long journey to walk before we will see the results and the intended impact,” Nkomo-Ralehoko said.
The Gauteng government remains committed to public infrastructure delivery. The National Development Plan 2030 provides a clear road map on how to eliminate poverty and reduce inequality, and infrastructure remains a key pillar to achieve these goals.
“The Gauteng Provincial Treasury recognises that infrastructure delivery is dynamic and that, as a collective, we must solve complex problems before the impact of our investment shall be visible. Gauteng remains committed to continue with reform initiatives to address the institutional blockages and weaknesses within the infrastructure value chain,” she added.
“Our specific focus will be on the implementation of standardised cost guidelines, ensuring that credible business cases are prepared before funds are allocated and working with all stakeholders within the infrastructure space to ensure that we can respond to the challenges which face us,” explained Nkomo-Ralehoko.
The infrastructure cost guideline establishes prescribed standardised approaches for projects procured by the Gauteng Provincial Government. The key objective is to make infrastructure more affordable and obtain value for money. This is in response to costs which are currently too high, poor output results and low investment impact in terms of service delivery and social gains.
“Infrastructure cost guidelines will promote good governance and prudent financial management. Thus, it is an integral additional part of the evidence-based budget reforms introduced by Gauteng Provincial Treasury in the 2016/17 financial year,” she added.
The limited fiscal leeway available to the Gauteng Provincial Government requires that it does more with the resources available and actively seek alternative sources of funding for Gauteng government projects and priorities, either through partnerships with the private sector, State-owned enterprises, other spheres of government or through bilateral and multilateral development partners as a way of leveraging resources outside of the fiscus to achieve the objectives of the Gauteng administration, said Nkomo-Ralehoko.
“The Gauteng Provincial Treasury has formulated a document for review that clarifies the process of seeing and receiving official development assistance, namely donor funding and also outlines the various sources, such as bilateral and multilateral, and mechanisms for accessing such funding, across infrastructure and non-infrastructure priorities.”
“This will enhance the work that the Gauteng Infrastructure Financing Agency (GIFA) is doing in exploring mechanisms for accelerating the delivery of infrastructure as a means to achieving the ideals of the Growing Gauteng Together 2030 plan,” she said.
As part of the Gauteng Covid-19 Response, R555.4-million was allocated towards the Health Human Resource Response to the Covid-19 human resources Response.
The province allocated R1.2-billion for the Presidential Youth Employment Initiative Funding, including R1.1-billion for the Basic Education Youth Employment Initiative, R74.6-million for health staff and assistant nurses and R43.7-million for social development workers.
Meanwhile, the Gauteng Provincial Treasury is consistently looking at various ways to enhance its revenue collection to supplement funding of provincial priorities. The updated estimated revenue of R3.7-billion, over and above baseline, is projected over the 2021 medium-term expenditure framework, said Nkomo-Ralehoko.
“Our forecast is that Gauteng’s real GDP for 2021 will increase by 4.7%, recovering to R1.1-trillion, and will only surpass the pre-pandemic levels in 2023,” she emphasised.
To reignite the Gauteng economy, R114.4-million was allocated for technical adjustments from underspending infrastructure projects towards the Tshwane Automotive Special Economic Zone Infrastructure Expansion, which is expected to not only boost manufacturing, but also provide much-needed jobs and stimulate the economy.
Further, R86-million is a reallocation from surrendered surplus funds towards Gauteng Enterprise Propeller programme on contract financing to support small, medium-sized and microenterprises.
Additionally, R366-million from internal reprioritisation of underspent infrastructure funding has been reallocated towards the Gautrain Management Agency Patronage Guarantee shortfall, which will be clawed back from Roads and Transport in the 2022/23 and 2023/24 budget baseline.
Further, in terms of conditional grant funding, R13.3-million was allocated towards the statutory human resources component of the Human Resources and Training Grant for the January 2022 additional intake of Medical Interns and Community Service cohort.
Conditional grant funding of R7.1-million was allocated towards the Mental Health Services Component of the human immunodeficiency virus, tuberculosis, malaria and Community Outreach Conditional Grant, and R25.6-million was allocated to the subsidy component of the Early Childhood Development Conditional Grant.
