by Adv Boitumelo Babuseng, MPL – DA Provincial Spokesperson for Finance, Economic Development & Tourism
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Date: 07 March 2018
The Democratic Alliance welcomes that the MEC for Finance, Economic Development & Tourism admitted that the finances of the provincial government are in a ‘precarious’ position and deteriorating . But this admission was only made to the Portfolio Committee on Finance, Economic Development & Tourism in the briefing following the tabling of the provincial budget today.
Indeed, the briefing revealed so many worrying factors that the entire budget speech delivered by the MEC is nothing more than a sham meant to mislead the people of this province. It is a speech which lacks all credibility delivered by a member who is not fit and proper to lead the provincial fiscus.
When the Democratic Alliance tabled our alternative budget on Monday, we said that the province had plunged over the fiscal cliff. The briefing to the Portfolio Committee confirms that statement and vindicates the DA’s position. Facts which the MEC conveniently ignored, includes:
• The province is projecting to close the 2017/19 financial year with a deficit of more than R529 million;
• The provincial bank overdraft stands at R395 million and the provincial government must apply to extend the amount in order to make provision for its skyrocketing debts;
• Unauthorised expenditure stands at R883 million, which is a very sharp increase from the unauthorized expenditure of R671 million recorded at the end of 2016/17.
These factors indicate that the financial position of the province is truly deteriorating and that we will have to continue to use 2018’s money to settle 2017’s debts. Indeed, the current rate of overspending in the provincial government so far exceeds the available resources that it will take more than five years to settle all current debts!
Yet there is nothing in the budget speech by the MEC which shows how the province will deal with these concrete, fiscal realities. A budget is truly about how the funding will translate into services and the real budget shows that there simply is no money to meet all the needs of our people.
The MEC also failed to address announcements made by the premier in her State of the Province Address that cost containment measures would be implemented. We can see from the budget that spending on non-essential goods and services like catering will increase, while spending on essential items like medical supplies and medicine will continue to decrease. This is not a budget which cuts the fat, but seeks to protect the benefits enjoyed by the patronage network that the ANC is built on and politically-connected elite.
The pronouncements made by the MEC on how irregular expenditure will be dealt with is really nothing new and is, in fact, already provided for in national and provincial policies. The problem is not that there are no guidelines in place, but that the guidelines in place are not being implemented. And since the MEC is regarded as the custodian of the provincial purse in terms of the Public Finance Management Act, the buck stops with him.
The MEC stated today that the budget is not about numbers. Indeed, the numbers show that the needs of the people will not be met – either in this financial year or the next.
Adv Boitumelo Babuseng, MPL
DA Provincial Spokesperson for Finance, Economic Development & Tourism
082 302 2117 / 079 874 6179
071 251 5558