Pat Sidley
SOUTH AFRICANS will not be able to see the full effects=20 of the first budget of the government of national unity=20 until the nine provinces present their budgets to their=20 provincial legislatures within the next few weeks.
The budget presented in parliament this week reflected=20 the amounts allocated for various national government=20 departments as well as amounts for the nine new=20
Provincial allocations will display the amounts in each=20 province that will be spent in crucial areas such as=20 health and education — and will also show the re- allocations and redistributions of resources required=20 by the reconstruction and development programme.
In the future, each province will receive a budget=20 allocation from the central government which will then=20 be split up among the provincial departments by each=20 provincial legislature. This process of allocations=20 within the provinces is subject to the normal=20 democratic processes of votes.
However, this year, because the proper allocation=20 process is not yet in place, the amounts provinces will=20 receive for each of their departments has already been=20 determined by the central government. But the=20 democratic actions of voting in each province on the=20 budget will go ahead anyway — something of a necessary=20
The Fiscal and Finance Committee has been set up by the=20 government to devise the exact ways in which the=20 central government and provinces will decide how money=20 is to be allocated between them. Committee member=20 Marius van Blerck explained that because the committee=20 has not yet finished its work, the central government=20 was forced this year to “treat the provinces like=20 government departments” and simply allocate amounts to=20
But even doing this isn’t exactly an easy way out.=20 According to the Department of Finance’s budget review=20 (presented on Wednesday with the budget), this=20 financial year’s projections “were compiled without=20 detailed budget figures from all the provinces”.=20 Certain other information wasn’t available which would=20 have been needed for “budget classification”.=20
Gauteng Minister of Education Mary Metcalfe told the=20 Weekly Mail and Guardian that the central government=20 did not have the legal power to impose allocations on=20 provincial government departments. Before the budget=20 was released, she had some idea of what her department=20 was going to get, subject to an announcement by Gauteng=20 economics minister, Jabu Moleketi, and a public debate.=20 But she would go through with the steps of decision- making this time around.
In future years, when the fiscal and finance committee=20 is up and running permanently, a way will be found in=20 which the provinces will be able to set out their=20 detailed assessments of their needs and will then have=20 the framework in which the central government and=20 provinces will be able to haggle for their share of the=20 cake. This will not happen before the 1996/97 budget=20
Van Blerck says that as in most federal systems around=20 the world, there will always be some tension between=20 provinces and the central government and between the=20 provinces themselves in allocating resources.
There ought to be clear reporting, however, in the way=20 it is all done.
The “messiness” of this budget has struck several=20 economists as lacking clarity, with several amounts=20 allocated from sources that don’t match neatly with the=20 departments to which they are being allocated.
Procedural problems and untidiness in transferring=20 funds from the central to provincial parliaments were=20 not the only bones of contention regarding the new=20
According to Old Mutual economist Terence Moll, foreign=20 investors want to know more about the economy than just=20 about the budget deficit and overspending. They wanted=20 to be briefed, he said, about what the RDP was doing so=20 as to gain some sense of the likelihood of future=20 political stability.
This was not in this year’s budget in nearly enough=20 detail, said Moll, and one could get no clear idea of=20 how the RDP had been spent and how successful it was.=20 There was also not enough indication of how it would be=20 spent in the future.