5 November 2007
Mid-Term Provincial Budget Report
Summary:
* The second quarter provincial budget statement of receipts and payments,
published by the National Treasury in terms of Section 32 of the Public Finance
Management Act, 1999 (PFMA) on 30 October 2007, covers spending for the first
six months of the 2007/08 financial year, which ended 30 September 2007. It is
available on the treasury website at http://www.treasury.gov.za.
* The information is based on the Section 40(4) PFMA reports signed by each
head of provincial department to their provincial treasury, and submitted to
the National Treasury by 22 October 2007. Queries on spending or budget numbers
should therefore, in the first instance, be referred to the relevant head
official of the provincial department, and in the second instance to the head
official of the provincial treasury. Queries on conditional grants may also be
referred to the relevant head official of the administering national
department.
Key highlights include the following:
* In aggregate, provinces have spent 46,0 percent or R96,9 billion of their
budgets of R210,5 billion for the period ended 30 September 2007. This
represents a spending increase year-on-year of 17,1 percent or R14,2 billion
higher than for the same period last year when provinces had spent R82,7
billion.
* Education expenditure totalled R42,5 billion or 47,9 percent of the R88,7
billion combined education budgets and remains the largest item on provincial
budgets (42,2 percent). The spending pattern reflects a 15,4 percent or R5,7
billion increase over the same period last year.
* Health expenditure totalled R2,4 billion or 47,9 percent of the R59,3
billion combined health budgets and is the second largest item (after
education) on provincial budgets (28,2 percent). The spending pattern reflects
a 13,7 percent or R3,4 billion increase compared with the same period in
2006/07.
* Social welfare services (social development) spending for the first six
months of the 2007/08 financial year is recorded at 40,9 percent or R2,7
billion of the R6,5 billion social welfare services budgets.
* Total personnel expenditure, in aggregate, is at 48,2 percent or R56,9
billion of the R118,1 billion personnel budgets. These figures include the
announced improvements in conditions of service (ICS) effected from 1 July
2007.
* In aggregate, provinces spent 39,8 percent or R7,1 billion of their R17,9
billion combined capital budgets. This is a significant improvement of 26,8
percent over the previous financial year, exceeding the R5,6 billion spent over
the same period in 2006/07 by R1,5 billion. This reflects an ongoing
improvement in capital spending capacity.
* Provincial education departments spent 38,0 percent or R1,5 billion of
their R3,8 billion education capital budgets. Again, this is significantly
higher with spending growing by 28,7 percent or R326,1 million when compared to
the same period of the previous financial year.
* Health provincial departments also significantly improved on capital
spending. They have spent 42,1 percent or R2,3 billion against their R5,5
billion health capital budgets, which is 20,9 percent or R400,5 million more
than the same period for 2006/07.
The greatest share of provincial capital is on the budgets of public works,
roads and transport departments at 38,7 percent. The sector spent 42,5 percent
or R2,9 billion against its combined capital budget of R6,9 billion. This
represents a massive increase of 47,1 percent or R944,4 million compared to the
same period last year.
* These suggest that the initiatives that have been put in place to enhance
infrastructure delivery are paying off.
* The government contribution for Gautrain totals R4,5 billion for the
2007/08 financial year. Of the R4,5 billion, R1,5 billion is funded through the
provincial equitable share (Gauteng Provincial Government) and R3,0 billion in
the form of a conditional grant (funded by National Government). Expenditure
incurred for Gautrain recorded against the equitable share portion is at R368,2
million as at 30 September 2007 and R997,5 million against the Gautrain Rapid
Rail Link conditional grant.
* Provincial own revenue collected thus far is at 57,1 percent or R4,4
billion of the total own revenue budget of R7,7 billion. National government
has transferred R89,1 billion of the equitable share and R14,8 billion in
conditional grants to provinces, during the first six months of 2007/08.
* A more detail analysis of the expenditure outcome as at 30 September 2007
is set out in Annexure A (available on http://www.treasury.gov.za).
Enquiries:
Lungisa Fuzile
Tel: 012 315 5158
E-mail: Lungisa.Fuzile@treasury.gov.za
Issued by: National Treasury
5 November 2007
Source: National Treasury (http://www.treasury.gov.za)
