Honourable Speaker,
Honourable Premier,
Honourable Members,
Our esteemed Traditional Leaders, and
All distinguished guests here today and all citizens of the Eastern
Cape,
Good morning!
Honorable Speaker, my first task as the head of finance portfolio is to present to the House Treasury’s budget policy statement which happens to be at the beginning of our new five-year term of government. Like the rest of the country, our province has heeded the call to work towards the implementation of the National Development Plan whilst addressing key provincial priorities.
Over the past five years, the department worked tirelessly to change the provincial fiscal position from a deficit to a budget surplus. Going forward, the province has committed itself to investing its fiscal resources in social and economic infrastructure with the aim of stimulating provincial economic activity, growth, development and creating jobs.
With this huge provincial task at hand, Provincial Treasury has a key role to play in ensuring that fiscal resources are allocated efficiently and sustainably over the medium term, whilst enhancing financial management to ensure that there is value for money. The current national fiscal framework necessitates the introduction and implementation of cost containment measures that will see the province move from consumption expenditure to investment spending. In addition, the province has to proactively implement own-revenue enhancing strategies as well as invest in identified strategic sectors in an effort to diversify the current economic landscape.
Honorable Speaker, Provincial Treasury will focus on the following policy priorities in the 2014/15 financial year:
1. Intensify provincial investments in both economic and social infrastructure to stimulate economic activity and create jobs.
In order to ensure that the investments in both social and economic infrastructure yield positive returns, Treasury needs to ensure that the most appropriate institutions receive these allocations. It is for this reason that Treasury is in the process of establishing a provincial infrastructure delivery arm that will be sufficiently capacitated to focus only on infrastructure delivery. This will require the pooling of already existing provincial capacity as well as resources in order to accelerate infrastructure delivery and address historic infrastructure backlogs.
2. Providing technical support and hands-on monitoring of infrastructure planning, design, implementation and expenditure.
Provincial treasuries are mandated to assess infrastructure plans that will be submitted to National Treasury for funding considerations. Given this, Eastern Cape Provincial Treasury will facilitate and oversee the integrated provincial infrastructure plan. Past experience has taught us that better planning and coordination is vital for actual and timeous delivery of infrastructure.
Treasury (jointly with the National Treasury) will introduce a full life-cycle costing in an effort to address the historic non-funding of maintenance. The purpose is to ensure that maintenance is catered for in all provincial infrastructure investment plans which is important for the longevity of these assets.
Current infrastructure expenditure in the province leaves room for improvement. It is Treasury’s intention to continue with the implementation of the Interdepartmental Accounting Model (IDA) which allows Department of Roads and Public Works (DRPW) to pay service providers on behalf of the departments of Health and Education timeously, and claims back thereafter.
Furthermore, Treasury will provide hands-on support on the drafting of credible plans for both the departments of Education and Health in order to ensure that they pass national assessment criterion for infrastructure funding in line with the IDMS.
Full speech [PDF]
