Thursday, 11 November 2021

Cape Town: Service delivery will be the focus of the budget over the next three years, says Finance Minister Enoch Godongwana.

During this period, consolidated government spending is expected to increase from R2.1 trillion to R2.24 trillion over three years.

“Put differently, government will spend more than R6.4 trillion over the next three years,” said Godongwana in his first Medium Term Budget Policy Statement (MTBPS).

He said the country’s unemployment challenge remains a key concern.

“South Africa continues to grapple with long-run unemployment and in the current conditions; unemployment is lagging the economic recovery. Government recognises that we need more private sector jobs, driven by a strong and growing investment climate,” said the Minister.

At the same time, the state must play a role in mitigating the impact of the crisis.

“Accordingly, the 2022 Budget will allocate almost R74 billion towards public employment programmes over the MTEF [Medium Term Expenditure Framework],” said the Minister.

In addition, further opportunities will be explored for supporting employment through other means.

Government will also maintain its commitment to supporting fee-free higher education. In this regard, funding for fee-free higher education and training has been increased. In 2020/21 government spent R44.7 billion on this function. This has been increased to R56.8 billion in the current year.

Over the 2022 MTEF, funding for higher education will total R158.8 billion.

He said this year’s MTBPS is also about continuing the country’s response to COVID-19 and its resultant economic and social impacts, “by providing additional short-term support where needed”.

“This year, we are increasing non-interest spending by R59.4 billion.”

The revised 2021/22 fiscal framework includes R3 billion in the contingency reserve for additional vaccine purchases and R11 billion as a provisional allocation to the  South African Special Risk Insurance Association (SASRIA) for risk coverage in the wake of the unrest in July.

Aside from allocations in the Special Appropriation Bill he tabled in August, most of the adjustments – R20.5 billion – are to cater for the higher-than-budgeted public sector wage agreement.