/ 7 March 2017

Gauteng budget cuts costs but not to vital services – and atones for Esidimeni deaths

Gauteng finance MEC Barbara Creecy.
Gauteng finance MEC Barbara Creecy.

Gauteng’s finance MEC, Barbara Creecy, said in her budget today that healing the state of public health in the province would be a priority this year.

In the face of heightened criticism over the Life Esidimeni tragedy, Creecy announced a budget allocation of R40.2-billion for the health sector. About R900-million of this would be set aside over the next three years for the provision of quality mental healthcare services in the province.

Life Esidimeni cared for the state’s psychiatric patients until health MEC Qedani Mahlangu, in a cost-cutting measure, decided last year to move them to various NGOs, most of which were not able to provide the level of care needed. As a result at least 94 patients died as a result of this decision. Mahlangu resigned and she’s been charged with culpable homicide and contravening the National Health Act and Mental Health Care Act

In his State of the Province speech last month, Gauteng Premier David Makhura promised to ensure better attention to the needs of the mentally ill in the province.

Creecy said the allocation made towards mental healthcare was part of government’s commitment to protecting the vulnerable and ensuring the implementation of the health ombud’s recommendations.

Education was Gauteng’s largest budget item with an allocation of R40.8-billion, an increase from R39.5-million in 2016. This includes the provision of more than 4 000 bursaries and scholarships to universities and technical and vocational training colleges. The province has set aside R1-billion for early childhood development centres.

Transformation of economy
Gauteng’s economy was projected to continue growing at a rate higher than that of the country. South Africa’s 2017 gross domestic product (GDP) growth is projected to be below 1% and that of Gauteng had a predicted growth of 1.8%, Creecy said. The provincial government’s focus would be on transforming Gauteng’s economy to increase participation, especially by previously disadvantaged individuals. Over the past three years R42.8-million was spent on procuring goods and services from previously disadvantaged people and R5-billion was spent on doing business with more than 2 000 township enterprises.

To increase these efforts Creecy announced that as of April 1 all projects with a value greater than R30-million would have to be 30% subcontracted to small and medium enterprises (SMME). Added to this government would offer financial support to 1 385 SMMEs

The Gauteng government set aside R44.4-billion for infrastructure spend, the lions share of which would be given to the human settlements department to fund the construction of 31 large housing projects. It’s hoped the increased spending on infrastructure would create more jobs in line with patterns exhibited between 2013 and 2016, Creecy said. During this period auditing firm KPMG reported the creation of 92 000 sustained jobs and the generation of R6-billion in government revenue.

Cutting costs
Creecy said R414-million was saved on cutting non-core costs such as transport, branding, catering and travel. These funds were redirected to other areas. Provincial government also saved R386-million in fruitless and wasteful expenditure by reducing interest paid on overdue accounts.

Creecy said the provincial government’s next focus would be to reduce the waste of allocated funds through under expenditure on planned projects.

“To ensure infrastructure budgets achieve their targets, funds have been allocated mainly to those projects that are shovel ready,” Creecy said.

This would mean money would be kept in an asset finance reserve and departments would have to bid for the money once they were ready to forge ahead with their projects.

Creecy said while the province was committed to cost-cutting measures, this would not apply to departments that delivered vital services to the public.

“”It has never been provincial government policy to save costs by cutting back on services to our citizens. In fact, every effort has been made to protect the budget of health, education and social development.”