Mashatile, Budget Vote 2006/07, at the Gauteng Provincial Legislature
22 June 2006
Comrade Speaker and Deputy Speaker,
Honourable Premier,
Colleagues in the Executive Council,
Honourable Members of this House,
Heads of our Agencies,
Ladies and gentlemen:
Introduction
The Soweto Uprisings of 16 June 1976, whose 30th anniversary we celebrated
about a week ago and the subsequent militant action by youth across our country
marked an intensification of the role of youth in the national liberation
struggle. Youth brought new hope to the oppressed that one day the cause of
national liberation would triumph. They ensured that liberation was achieved in
our lifetime.
Equally the historic women's march to the Union Buildings at which women
across the length and breadth of our country boldly declared that they will not
rest until total liberation for the people of South Africa has been attained,
was an important milestone in the struggle to liberate our country.
To those who dared to confront the might of an oppressive regime for us to
be liberated, we owe a great debt of gratitude. In honour of their bravery and
sacrifices we must deepen the gains of our democracy and continue building a
better country.
As we mark the 30th anniversary of 16 June and the 50th anniversary of the
women's march to the Union Buildings, we must strengthen our effort aimed at
expanding access to economic opportunities for our youth and women.
Collectively we have a responsibility to continue creating opportunities for
women and young people to participate meaningfully in the economic mainstream.
They too must benefit from the progress we are making in growing and developing
our economy.
Economic environment
Comrade Speaker, given Gauteng's position as an economic engine of our
country and a significant economic player in the southern African region and
the continent it is necessary for us to keep an eye on developments at a macro
economic level as well as in the global economy.
In this regard we are encouraged by the strength of our national economy
which has been growing consistently over the past six years. In the first
quarter of 2006, the economy steamed ahead registering a Gross Domestic Product
(GDP) growth rate of 4,2 percent. The current strength of our economy points to
the success of the macro economic interventions made by the African National
Congress (ANC) government shortly after our liberation in 1994.
Though impressive the growth of our economy remains unbalanced fuelled
largely by rampant consumer spending that is unmatched by domestic production.
This has led the now existing current account deficit. Pockets of poverty, the
skills gap and income inequalities still persist and remain areas of concern.
We also note that the current volatility in international financial markets can
have an impact on us an emerging market.
Despite this, Speaker, we remain confident that our country's favourable
macroeconomic, fiscal and monetary mix will sustain the resilience of our
economy.
At a provincial level we draw comfort from the knowledge that provincial
economic growth continues to be healthy and that our province has the highest
per capita income in our country.
Equally impressive is the emergence in our province of new centres of
economic activity in areas such as Soweto and some parts of the Johannesburg
Central Business District. This trend has led to growth in the tourism, retail,
transport and telecommunication sectors in these areas. More importantly it has
led to employment creation, wealth and income generation.
These areas have broken with their past, characterised by being on the
fringes of the economic mainstream.
The emergence of new centres of economic activity in our province can be
attributed to the massive infrastructure investment that has gone into these
areas. This proves once more that investment in infrastructure can and does
stimulate economic activity. We expect this trend to gather momentum as we
invest in the improvement of infrastructure in more townships as part of the
twenty priority townships programme.
As we make progress in promoting the shared growth of our economy, we are
mindful of the challenges that lie ahead. We are concerned about the persistent
levels of inequality, skills shortage and the high levels of poverty and
unemployment in our province.
These challenges place on our shoulders the enormous responsibility to work
even harder to deepen and spread our economic gains. This we must do in order
to sustain the spirit of optimism that characterises the âAge of Hopeâ that
Gauteng like the rest of our country has entered into.
Review of the 2005/06 financial year
Comrade Speaker, allow me now to highlight some of the programmes we have
undertaken in the past financial year as part of our overall commitment to
accelerating the shared growth of our economy, job creation, fighting poverty,
developing skilled and productive people, building an effective and caring
government, deepening democracy and entrenching the constitutional rights of
our people.
One of our ongoing tasks is to facilitate the implementation of the
provincial Growth and Development Strategy (GDS). We are delighted to report
that implementation of the GDS took off in the 2005/06 financial year with the
launch of the Gauteng Enterprise Propeller and the establishment of the GDS
fund capitalised to the tune of R1,3 billion over the next three years.
During the 2005/06 financial year, a total of R134,4 million was allocated
to various departments to fund GDS commitments. These include the agro
processing project of the Department of Agriculture, Conservation and
Environment as well as the Gauteng Provincial Governments' Contact Centre.
We also drafted a provincial Broad Based Black Economic Empowerment (BBBEE)
strategy which after extensive consultations with stakeholders was launched in
April this year. This strategy will enhance our efforts to broaden
participation in the mainstream economy thus promoting the shared growth.
We began consultations with stakeholders with a view to develop a policy
framework to support cooperatives in Gauteng. We expect to complete this
process by the end of the current financial year.
Furthermore, we developed a Provincial Spatial Development Perspective
(PSDP) with a view to foster a common understanding of the spatial location of
development potential and poverty in the province. This perspective will also
assist us to align investment and development planning in the district and
metropolitan municipalities.
We also strengthened our ability to monitor, evaluate and support
departmental agencies. All our agencies completed a review of their strategies
and have aligned them to provincial priorities.
We continue to improve turnaround times for the processing of liquor
licenses and our consumer protection and awareness programmes have reached new
heights.
Comrade Speaker, the total budget for the Department of Economic Development
for the current financial year is R572 million. Allow me now to elaborate on
how it will be allocated among the various units of the Department.
Governance
Liquor licensing
Over the past few months, developments relating to the issuing of shebeen
permits and in particular the quantities of liquor that these establishments
are required to sell have been the subject of much media attention.
We welcome the decision of the Constitutional Court on this matter and we
will implement it without delay. In addition, we wish to reiterate that we
regard shebeens as an import sector within the liquor industry.
Historically shebeens have provided a source of employment and income to
many households. Even today many of our people rely on income generated from
shebeens to put food on their tables.
Our interventions in the liquor industry are aimed at creating an enabling
environment for expanded participation in this industry and to ensure that its
economic benefits are shared. Our interventions are also aimed at protecting
the interests of the broader public and to prevent incidences such as the
selling of liquor to minors.
We have no intention of stifling the development and growth of shebeens. On
the contrary, we wish to see those who operate in this sector grow their
businesses into sustainable entities. We expect them to take advantage of the
many economic benefits provided by the liquor and related industries such as
tourism.
It is against this background that we are currently reviewing the provincial
Liquor Act. We expect to complete this process by October this year.
Our liquor licensing unit will also pay attention to raising awareness about
the benefits of responsible trading in liquor.
Consumer affairs and business regulation
The consumer affairs and business regulation unit will continue its work of
promoting fair business practice and the protection of consumer rights. This we
will do as part of our contribution to deepening our democracy and entrenching
the constitutional rights of our people since it is our belief that consumer
rights are human rights.
We take pride in the work done by the Gauteng Consumer Court. It resolved
well over 80 percent of cases referred to it and has significantly reduced the
work load of other courts in our province. We will this year reduce the
response time for complaints referred to the office of the Consumer
Protector.
The design of consumer education learner support material to grade 10
learners will also receive attention.
Comrade Speaker, the total budget for the governance unit which includes
agency support, monitoring and evaluation is R269,4 million.
Economic and development planning
As directed by the Premier during the State of the Province address we will
this year accelerate the implementation of the GDS. This will contribute to the
achievement of the overall objectives of the Accelerated and Shared Growth
Initiative for South Africa (AsgiSA).
We will identify projects that will contribute to our objective of
stimulating sectors identified by the GDS as critical to the growth of the
provincial economy. We will also pay attention to the monitoring and evaluation
of progress made in the implementation of the GDS.
In October this year we will convene a GDS forum. This forum will bring
together all stakeholders in the Gauteng economy to take stock on the
implementation of the GDS. We hope to emerge from this forum with a joint
programme of action to consolidate the gains we have made in the implementation
of the GDS and to further accelerate its implementation.
We will also support municipalities in the implementation of uniform land
use management systems. In doing so, we will focus on the development of
appropriate policy positions in respect of zoning schemes. The processing of
land development applications will also be fast tracked.
We will continue to identify further interventions aimed at accelerating the
shared growth of the provincial economy and addressing the challenges of the
second economy in our province.
Comrade Speaker, the economic and development planning unit receives R45,7
million.
The Gauteng Tourism Authority (GTA)
As we have said before, tourism has become our "new gold." Its contribution
to the GDP now surpasses that of the gold mining industry. It is a sunrise
industry that holds numerous benefits for our country and our province.
Tourism is uniquely positioned to create opportunities for the participation
of small, medium and micro enterprises (SMMEs) and can contribute massively to
the development of local economies.
We believe that the GTA is positioned properly to maximise the benefits of
tourism to our province. Partly through the work of GTA numbers of
international visitors who come to our province show a positive increase.
The challenge going forward is to increase these numbers and ensure that
tourists who come to Gauteng not only land and do business here but that they
spend more time experiencing Gauteng's unique tourism offerings.
We also rely on the GTA to accelerate transformation in the tourism industry
and to ensure expanded participation.
GTA receives a total of R33,5 million. The agency's strategic plan is
currently under review and once approved, its Medium Term Expenditure Framework
(MTEF) budget will also be reviewed.
The Gauteng film office
The Gauteng film office will implement a Public, Private Partnership (PPP)
to establish a Broad Based Black Economic Empowerment (BBBEE) Film and TV Fund.
Our private sector partner in this project has committed itself to investing
R250 million in the local film industry.
We will this year develop a policy framework for the implementation of the
film city concept. In addition, we will continue to build the capacity of the
Gauteng film office to implement its mandate. This will include amending
legislation governing the Gauteng film office, a process we will complete in
November this year.
Comrade Speaker, the Gauteng film office receives R3,5 million. Additional
funding over the MTEF will be considered in line with the film office's new
strategic plan
The Gauteng Enterprise Propeller (GEP)
The establishment of GEP marked the beginning of a new dawn for the growth
and development of SMMEs and cooperatives in Gauteng. GEP remains at the centre
of our efforts to grow the economy, create jobs and expand participation in the
economic mainstream.
Since its establishment in April 2005 GEP has assisted over 1 000 SMMEs
through its business development support programmes. This has led to the
creation and retention of 400 jobs. In partnership with the National
Productivity Institute (NPI) and Business Skills South Africa, GEP is providing
business training to unemployed graduates across Gauteng.
During this year GEP will roll out two funds whose purpose is to provide
financial assistance to SMMEs and cooperatives in Gauteng. It will also
establish satellite offices in previously disadvantaged areas of Soweto,
Alexandra, Soshanguve and Themba.
Comrade Speaker, GEP receives R80 million for the current financial
year.
The Gauteng Gambling Board
The Gauteng Gambling Board will continue to be a significant collector of
revenue for the provincial government. We expect the board to collect revenue
in excess of R365 million for the provincial government in the current
financial year.
The board will also intensify its work of promoting responsible gambling.
Corporative governance within the board will also be strengthened. Furthermore
the board will enhance the implementation of BBBEE within the gambling
industry.
The Gauteng Economic Development Agency (GEDA)
In line with its new and expanded mandate, GEDA will pay attention to the
facilitation of foreign and local investment into our province. We have set for
ourselves a target of attracting investment to the value of R1,6 billion during
the current financial year.
GEDA will also focus on building multilateral and sisterhood agreements with
special emphasis on South to South relations and the African continent. The
agency will actively support local economic development initiatives and enhance
BBBEE in all export and investment promotion activities. It will also pay
attention to the promotion of the call centre industry in Gauteng.
GEDA receives a total budget of R32,5 million. Its MTEF budget will be
reviewed in line with its new strategic plan
Blue IQ
By investing in strategic economic infrastructure, Blue IQ has contributed
to the creation of a conducive environment for accelerated and shared growth of
the provincial economy.
Thus far we have invested over R2 billion in improving economic
infrastructures in our province. This has had the desired effect of "crowding
in" private investment in targeted sectors of our economy, establishing new
nodes of economic activity and contributed to our urban renewal programme.
Phase one of the implementation of Blue IQ projects which started in 2001
has been completed. The task going forward is to attract further private sector
investments into these projects.
Comrade Speaker, inspired by the success of Blue IQ initiatives, there may
be a need to consider further high impact projects that will ensure that we
register new gains in our ongoing effort to grow the economy. These projects
must be designed such that they contribute to the creation of a conducive
environment for accelerated growth of the provincial economy.
For the current financial year, Blue IQ, receives R79,2 million. Further
funding to allow Blue IQ to continue its work of improving the economic
infrastructure of our province will be made available from the GDS fund.
Special projects
Dinokeng and Cradle of Humankind World Heritage Site
These projects have an important role to play in promoting tourism in our
province. Visitor numbers to Maropeng at the Cradle of Humankind show a
positive increase. In addition, the number of tourism developments around the
Cradle of Humankind and Dinokeng is on the rise. This has contributed to
economic growth and job creation in areas near these developments.
The development of the Dinokeng Game Reserve will go a long way towards
promoting conservation based tourism in our province. We expect that the game
reserve will be opened for business in December this year.
Comrade Speaker, the Cradle of Humankind and Dinokeng receive R46,3 million
R93,5 million respectively.
The Gauteng Provincial Government (GPG) precinct
One of the goals of the GPG precinct is to improve service delivery to our
people. This will be done through providing a rewarding working environment for
public servants, improving contact between provincial departments and
facilitating easy interaction between the provincial government and the people
of Gauteng.
The precinct will also contribute to the rejuvenation of the inner city of
Johannesburg and will lead to job creation and promote investment. It will
further assist in changing prevailing negative investor perceptions of the
property market in the Johannesburg central business district (CBD).
Comrade Speaker, we have allocated an amount of R70,7 million for the GPG
precinct.
Conclusion
In conclusion, I wish to assure this House that the Department of Economic
Development is ready to make its contribution towards building a better Gauteng
and sustaining the mood of optimism among many of our people. We will continue
to honour the sacrifices of those who fought for us to be a free nation. We
will ensure that the ideals they fought for are realised.
Let me take this opportunity to thank the Premier for his firm and decisive
leadership in ensuring that we deliver on our objectives, my colleagues in the
Executive Council (ExCo) for their collective wisdom and support, the
honourable members of the Department of Economic Affairs Standing Committee led
by comrade Mondli Gungubele, Ms Bongi Kunene our HOD, heads of our agencies and
senior management within the Department.
Let us all work together towards accelerating the shared growth of our
economy for a better Gauteng.
Thank you!
Issued by: Department of Finance and Economic Affairs, Gauteng Provincial
Government
22 June 2006
