Licensing fee hike fixed by CPI, not for alleged budget shortfall

2012-04-10 00:00

THE hike in KwaZulu-Natal’s licensing fees was not because of any budget shortfall as the province’s finances were now in the black, according to the provincial treasury.

Fees raised through traffic fines and licensing fees were added to the province’s revenue and would be allocated to various government programmes, said Treasury spokesperson Ntokozo Maphisa.

Recent reports in the media, including The Witness, said the pro­vince had planned to top up its budget shortfall by increasing licensing fees.

However, Maphisa said KZN’s finances were healthy and there was no shortfall.

He added that licence and other fees levied by the province were determined annually by using the Consumer Price Index published by the Reserve Bank.

Maphisa said KZN had managed to collect R2,33 billion in the last financial year.

That was added to the R63,8 billion received from national treasury, as well as conditional grants for infrastructure projects totalling R14,43 billion.

Maphisa said that on any given month, KZN had a positive bank balance, ranging from R3 billion to R5 billion.

As announced in the provincial budget, there was also R1 billion available as a contingency reserve.

“We are in a good financial position because we also earn interest on our positive bank balance. We then take that interest earned and put it together with the province’s own revenue,” he said.

This was not always the case, as the province had worked hard to turn the corner after three consecutive years of over-expenditure.

“Mid-way through the 2009/10 financial year, the picture was bleak. Projections indicated that the pro­vince was heading for an over-expenditure of some R5,6 billion if we did not take drastic action,” Maphisa said.

Twenty one cost-cutting measures were introduced to improve the situation and still remain in place.

Among the measures were that only MECs and heads of department should travel business class on flights, the class of hired vehicles should be lowered, catering for meetings stopped, while unnecessary overnight accommodation had to stop.

“The cost-cutting measures will remain in place for the foreseeable future and are really elements of good governance rather than a once-off attempt to contain costs,” he said.


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