Cash-strapped Limpopo expects surplus

2012-01-29 22:41

Johannesburg - Limpopo Premier Cassel Mathale believes his cash-strapped province will have a surplus on its R40bn budget by the end of the current financial year.

Speaking to journalists after opening his party's two-day lekgotla in Polokwane on Sunday, Mathale said the province was not bankrupt and was still able to pay civil servants and service providers from its allocation.

This was despite Finance Minister Pravin Gordhan's pronouncement earlier this month that the province was facing a potential R2bn deficit, due to the violation of the Public Finance Management Act and gross violation of procurement policies.

“We have not exhausted our budget. The issue of us being technically bankrupt is as [a] consequence of the overdraft that has been there," said Mathale.

"When you have an overdraft, it does not mean that you are bankrupt, you just have... an arrangement with your bankers.

“We are not bankrupt, we still have our allocation ....there are possibilities that we may not spend all our money." 

Bigger overdraft

Limpopo's head of treasury Nerulal Ramdharie recently requested an increase of the provincial government overdraft from R757m to R1.7bn, which was rejected by Gordhan.

This had saved millions of tax payers' money, Mathale said.

The province's finance, education, health and social development, public works, and education departments were placed under the national government's control last year. The remaining departments were operating under guidelines provided by national government.

Limpopo's financial woes were due to unauthorised expenditure, which grew from R1.5bn in 2009 to R2.7bn in 2011, Gordhan said earlier this month. A forensic investigation into the shortfall was currently underway.


Mathale in his opening address appealed to ANC members in the provincial government not to be "defocused" by the fact that five departments had been placed under national administration.

"This must not defocus from the commitment we have made to the people on the mandate they have given us to deliver to their needs," he said.

He said the province had an obligation to turn the current state of affairs around, "no matter how much we may not like this reality or view it as unwarranted".

Mathale called on party members to work hard to ensure the Limpopo government got back control of the five departments, and do so quickly.

It was the "responsibility of the caucus to transform constituency offices into one-stop centres that offer assistance to our people".

Officials who neglected their constituency work and obligations were "betraying the movement and our people."


Mathale called for the "overdue" reconfiguration of parastatals so they could play a more active role within job creation and economic diversification.

However, jobs could not be created without input from the private sector.

Mathale told the meeting that the eurozone debt crisis had hampered the province's job creation plan, with growth sustained, but at a slower rate.

The two-day long lekgotla ends on Monday.

Read more on:    cassel mathale  |  pravin gordhan  |  polokwane  |  local government  |  economy  |  politics  |  government spending

Join the conversation! encourages commentary submitted via MyNews24. Contributions of 200 words or more will be considered for publication.

We reserve editorial discretion to decide what will be published.
Read our comments policy for guidelines on contributions.
NEXT ON NEWS24X publishes all comments posted on articles provided that they adhere to our Comments Policy. Should you wish to report a comment for editorial review, please do so by clicking the 'Report Comment' button to the right of each comment.

Comment on this story
Comments have been closed for this article.

Inside News24

INFOGRAPHIC: New thinking required for retirement

Everything we believe about retirement is fast becoming outdated.


Book flights

Compare, Book, Fly

Traffic Alerts
There are new stories on the homepage. Click here to see them.


Create Profile

Creating your profile will enable you to submit photos and stories to get published on News24.

Please provide a username for your profile page:

This username must be unique, cannot be edited and will be used in the URL to your profile page across the entire network.


Location Settings

News24 allows you to edit the display of certain components based on a location. If you wish to personalise the page based on your preferences, please select a location for each component and click "Submit" in order for the changes to take affect.

Facebook Sign-In

Hi News addict,

Join the News24 Community to be involved in breaking the news.

Log in with Facebook to comment and personalise news, weather and listings.