CORRIDORS OF POWER

Twenty-five years into our democracy.

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The media room is packed to the rafters with journalists and photographers at the Gauteng Provincial Legislature in Rissik Street, Johannesburg. Twenty-five years into our democracy, we stand at a moment in history, where our decisions could lead South Africa further into the abyss, or, perhaps, a brighter future.

Ten percent of property sales are now attributed to immigration. Many of these homeowners are from Gauteng. Much is at stake. The challenge is to stimulate growth that exceeds population growth, create jobs, attract investment and provide a firm backbone of services such as energy, healthcare, infrastructure, transport and education. Improved economic performance and stability will require good governance. There must be an end to the wasteful and irregular expenditure that has plagued Government, year after year.

MEC of Finance and e-Government, Nomantu Nkomo-Ralehoko, is presenting Gauteng’s 2019 Medium-Term Budget Policy Statement to the Gauteng Provincial Legislature. She accepts an impromptu request to be photographed before proceedings get underway. As responsive to the camera as a model, the MEC scolds the photographer for suggesting he will make her famous.

Nkomo-Ralehoko cautions that Standard & Poor’s Global Ratings, a barometer of the country’s financial wellbeing, has revised South Africa’s outlook to negative. “The question as to why growth has been so elusive is an important one and academics, researchers and economists have referred to structural problems of the economy, policy consistency and certainty, as well as reliability of energy and water supply.

“Finance Minister, Tito Mboweni, went on to announce a downward revision to South Africa’s economic growth rate,” states the MEC. “The economy is now forecast to grow at 0.5 percent compared to the 1.5 percent projected at the beginning of the year [2019] due to the uncertainty of power supply, service delivery protest and tight fiscal policy, among other key constraints to economic growth. Our national debt is increasing at an unsustainable rate.”

Playing Catch Up

Gauteng contributes 35.1 percent of South Africa’s Gross Domestic Product. Yet, the province’s economic growth is lagging behind population growth. Nkomo-Ralehoko reminds us that this creates “a disproportionate burden on the social and economic infrastructure and the provision of basic services, and critically on the capacity of the economy to absorb higher numbers of our people into gainful economic opportunities.”

“Growth for Gauteng province is projected to slowly rise to 1.8 percent in 2022, which is expected to be above the national average of 1.7 percent for the same period,” she adds, as a post bad news sweetener. Continuing in a similar vein, the MEC announces that the investment appetite continued to grow with President Cyril Ramaphosa’s 2019 Investment Conference attracting R363 billion investment commitments, with an additional R8 billion worth of investment commitments, pending regulatory or board approvals.

Ease of business is a priority for investors. InvestSA Gauteng, a division of the Department of Trade and Industry is working towards establishing Gauteng as the preferred location for investment. “Over the past five years, InvestSA Gauteng facilitated investments worth about R10 billion in the Gauteng City region. A total of R6.9 billion of these investments were foreign direct investments and the balance were domestic direct investments.”

Addressing youth unemployment is critical. The Gauteng Provincial Legislature is supporting this issue with internships, and linking the youth and people with disabilities to government programmes. Nkomo-Ralehoko wants to see a change from young people standing idle on street corners and using drugs; to becoming gainfully employed.

Competing Priorities

With over 20 years in Government, the MEC’s skills will be tested. Provincial priorities are diverse, amidst a shrinking budget. There have been tough calls – necessitating ‘adjusted appropriation’ within departments.

The key objectives for the Gauteng Provincial Treasury in 2019/2020 are varied. Gauteng Premier, David Makhura, announced five priorities within a “Growing Gauteng Together Plan” (GGT). These priorities include economy, jobs and infrastructure; education, skills revolution and health; integrated human settlements and land release; safety, social cohesion and food security; as well as building a capable, ethical and developmental state.

Nkomo-Ralehoko urges constraint and return on investment. “Tough decisions must be made in the light of ever-increasing needs and extremely limited resources, reorienting from administrative and consumption expenditure to service delivery items and productive assets. A key deliverable of the Gauteng Provincial Treasury is containing the provincial wage bill to a maximum of 60 percent of the total budget of the province.”

Gauteng must create an enabling environment for economic growth and employment —while supporting programmes for poverty alleviation such as food banks and feeding programmes, and school and homestead gardens; which are all vital for food security.

2019/2020 Gauteng Budget

Some budget allocations seem at odds with expectation, others, adequate. The Department of Health gets the lion’s share with R51.5 billion, which includes R20.2 million additional funding for infrastructure. With staffing stretched, R132.7 million has been allocated for posts and contracting health professions. The Premier wants the Gauteng Health Department to focus on primary health care.

Funds were reprioritised for priority hospitals, identified by the Premier in his 2019 State of the Province address and the MEC for Health in his 2019/2020 Budget Vote speech. Premier David Makhura asked the national department to fund four of the province’s central hospitals; Charlotte Maxeke, Steve Biko, Baragwanath and George Mukhari. He explained the hospitals were underfunded for their role.

Correspondingly, the provincial budget allocation for central hospitals increased by R649 million, with R38 million from national conditional grants. Important allocations include:

R17 billion for district health services
R18.9 billion for central hospital services
R9.4 billion for provincial hospital services (including general, TB and psychiatric hospitals; dental training colleges and other specialised hospitals)
R1.5 billion for emergency medical services
R1.2 billion for health sciences and training
The Gauteng Education Department has a 2019/2020 budget of R49.6 billion. R888 million of the provincial education budget has been allocated to Early Childhood Development. The early phase of a learner’s development has proven to significantly influence scholastic achievement. One hopes that this allocation is increased in future budgets.

The Education Department’s mission is to ‘provide functional and modern schools that enable quality teaching and learning to protect and promote the right of every learner to quality, equitable and relevant education’. Inadequately qualified teachers, poor performance, school violence, vandalism and inadequate infrastructure need urgent attention.

The provincial budget for the Department of Roads and Transport is R7.8 billion. There is a welcome boost to the budget: R91.4 million for maintenance and repairs of existing roads in the province. The Gautrain Rapid Rail Link has attracted R2.1 billion.

The Department of Human Settlements’ budget of R6.3 billion, includes R5.2 billion for housing development. In the past financial year (2018/2019), the Department announced the introduction of a Rapid Land Release Programme and Upgrading Support Programme for upgrading informal settlements. R1.6 billion is available in the current financial year.

The Department of Social Development budget for Gauteng is R5.4 billion. Children and families’ allocation is R2.3 billion, a 5 percent increase from 2018/19. There has been an increase in court referrals for children to be placed in children’s homes. R415 million will be directed to prevention and rehabilitation regarding substance abuse.

One wonders at the rationale behind the provincial Department of Agriculture and Rural Development only receiving R992 million. Farmer support and development receives R195 million, with R76 million directed towards research and technology services, and R111 million for veterinary services. On a more positive note, the Graduate Programme has been upscaled from 170 to 400 graduates, who will be placed on farms to gain experience. The Youth Jobs in Waste project, to the tune of R7 million, creates 135 additional work opportunities.

With R969.3 million, the Department of Sports, Arts, Culture and Recreation receives slightly less than Agriculture.

The Department of Economic Development receives R1.6 billion. The Department receives an additional R33.4 million for the Gauteng Gambling Board business automation project “to enhance revenue maximisation”.

The Province relies on infrastructure. R3.42 billion is directed to the Department of Infrastructure and Development. This Department achieved noteworthy savings of R6 million in the current financial year after an analysis of its telecommunications bill, attributed to new policies.

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