MEC hints on budget

2014-03-06 00:00

KWAZULU-NATAL MEC for Finance Ina Cronjé hinted at the possible focus areas of her upcoming provincial budget speech next week at the Morar Incorporated annual post-budget breakfast.

Cronjé was speaking on the potential impact of the national budget on KZN over the weekend.

“The National Development Plan and the Provincial Development Plan are totally aligned,” Cronjé said. “As a country we’ve adopted the NDP and it would be very strange to adopt it as official policy and the official plan for the country, and then allocate our resources contrary to that plan.

“You cannot fund nice-to-have and optional extras where you have a limited fiscal resource,” she said.

She said the provincial budget had to pass the test of whether it facilitates and encourages job creation, human resource development, human and community development, environmental sustainability, strategic infrastructure, good governance and policy, and spatial equity.

As part of human resource development, Cronjé encouraged business to support the youth with on-the-job training.

“There’s a lot business can do to give youth a chance,” she said, and added that the youth wage subsidy has already been shown success in this regard.

“The uptake has been significant. Young people who were not employed previously are now employed and gaining that very important experience.”

She also acknowledged the “very, very fundamental” importance of strategic infrastructure and admitted that without that we will not be “the successful, developmental state that we want to be”.

The MEC said that government, national and provincial, remains committed to counter-cyclical fiscal policy. Spending on infrastructure, she said, was the best grower of the economy and provider of jobs.

“When times are tough, the tough go spending, but not just spending on anything, spending on infrastructure … to correct the economy.”

Cronjé also highlighted the fact that the province was committed to cost containment measures and urged citizens to live within their means.

For the 2014/15 budget year, provinces combined get nearly R363 billion, she said.

The equitable share that KZN gets — calculated on a specific formula that takes demographics and other factors into account — amounts to R78,1 billion.

The bulk of the money the province gets comes from that equitable share.

That is then topped up with conditional grants and the province’s own revenue.

Because National Treasury has put a ceiling on the amount of money that will be available for budget, so that debt can be paid off, KZN has, Cronjé said, “put a whole team in place to increase our own revenue collection … because every cent [of that] that we get, goes straight into the provincial coffers and can be allocated”.

She said the province was aiming to maximise its own revenue — which it earned through gambling, road traffic offences, patient health fees at government hospitals and the like — to top up the funds available to it.

“We are projecting to considerably over-collect from our initial projections,” she said.

But while the province intended to maximise its revenue, Cronjé asked whether we were getting value for money. “I think it should be of concern to all of us.

“We cannot cut on service delivery. We must cut on wastage, and programmes and projects that really add no value,” the MEC said.

Other speakers at the breakfast function included national Deputy Minister of Finance Nhlanhla Musa Nene, District Mayor Yusuf Bhamjee, and motivational speaker Ingrid Roberts, who was representing women in business; as well as members of Morar Incorporated.

Cronjé will deliver the 2014/15 provincial budget speech on March 11 in Pietermaritzburg.

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