Budget: Health, education prioritised

2011-02-23 13:13

Finance Minister Pravin Gordhan today unveiled a R979-billion

budget in which once again education and health received massive


For the fiscal year 2011/12, which begins in April, Gordhan

allocated education R189.5 billion, an increase of 9.7% more than last year.

Health received R112.6 billion, an allocation that is 9.8% more

than the previous year. The allocation to health is equivalent to 21% of

non-interest spending by government and will be used to enhance and expand

services provided training colleges.

Another big non-interest expenditure in Gordhan’s budget is the

public service salary bill of R314 billion, which makes up just under 40% on

non-interest spending.

Five years ago, the state’s wage bill was R156 billion, meaning it

has doubled to date. Gordhan allocated R147 billion for social grants to support

poor households and pensioners.

In his Budget Speech, Gordhan revealed that government spending

will reach R1.2 trillion in 2013.

He also said that government debt has rise from R526 billion at the

end of 2008/09 to over R1.3 trillion in 2013/14.

The increase in state debt will

push debt service costs to R77 billion next year, rising to R104 billion in


“To ensure that our spending on schools, hospitals and roads is not

crowded out by an ever-rising interest burden, government debt needs to be

managed sustainably.

“We don’t want an unmanageable increase in expenditure, nor do we

want the severe austerity measures some western countries have had to adopt,”

said Gordhan.

He also announced that government will maintain the over

R800-billion expenditure to modernise South Africa’s infrastructure.

Gordhan said the state had about R889 billion in the kitty for the

year and that R77 billion of the amount will go towards paying interest on state

debt while national government departments will be given 47% of the of

government’s total revenue.

Gordhan hinted in the budget speech that the much-awaited youth

employment fund was on its way. The fund will be capitalised to the tune of R5 billion.

“We must take measures to ensure that our young people can look

forward to decent work in productive, competitive enterprises,” Gordhan


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