Pietermaritzburg: 8 December 2011
When these adjustments are passed in this
House, the province will have paid off a multi-billion rand
overdraft which began to accumulate four years ago. It is quite
an achievement that this exercise has taken a year and a half
instead of three years as was the initial plan. This has to be
duly acknowledged and I take this opportunity on behalf of the
Official Opposition to do so. Well done, MEC!
However, we also need to acknowledge that
eliminating the overdraft ahead of schedule has come at a cost.
Last year, our province underspent heavily, especially on
infrastructure and as a result of failure to fill funded
critical posts. Both of these items are key to service delivery,
particularly in service delivery departments such as Health or
Human Settlements. My emphasis is on funded critical posts
because we believe, together with the Hon. MEC for Finance, that
while all critical posts should and must be filled, the freeze
on the filling of non-critical posts should remain in place.
When we talk about civil service positions in
this House, we only draw the distinction between critical and
non-critical posts with regards to vacancies. We are not even
asking how many of the existing 180,000 odd civil service
positions in our province are truly critical to service delivery
and how we can improve on the productivity of these public
I raise this point because their collective
payroll is the single largest line item of expenditure in our
budget and, more than that, year after year higher than budgeted
for wage increases, together with the implementation of various
OSDs, represent unfunded mandates. This puts an enormous strain
on the provincial budget and it constantly detracts from our
service delivery objectives.
By making this point, I am not calling into
question the employment status of the existing members of the
civil service. I am only making a case for the continued
implementation of the moratorium on the filling of non-critical
vacancies. And, at the same time, I am calling for measurable
tools to improve productivity across the civil service, measures
that go beyond the current performance agreements – which, in
any case, are at present being ignored by more than half of our
Even as our provincial economy continues to
shed jobs, the only significant growth in job creation is in the
public sector. Our growing public sector wage bill continues to
reflect government’s position as the largest job creator in our
economy. As this is happening, our national Minister of Finance
tells us frankly that our public sector wage bill has already
extended beyond what our country can afford.
We in the Official Opposition see no problem
in offering appropriate compensation to public servants who add
value to service delivery in our hospitals, schools, police
stations and elsewhere where frontline services are delivered,
but we are totally opposed to the taxpayers’ money being wasted
on grossly overpaid deployed cadres in a bloated bureaucracy
that adds little value to the upliftment of our people.
The growing public sector wage bill together
with the downgraded forecast for growth in the provincial
economy means more spending pressures in government against less
tax revenue. This is bound to put additional pressure on all
government agencies, including our provincial administration, to
consolidate their finances.
As a result of financial strain, many
requested rollovers have not been approved and such prudence
must be welcomed. This leaves departments with an even more
urgent need to find efficiency savings in order to fund their
equitable share commitments from the previous financial year.
Yesterday, I expressed our concern about the inconsistent
implementation of cost-cutting measures across government
departments and I would like to reiterate this concern today.
Some departments conti........ that are subject to
cost-cutting measures, such as communications, venues and
facilities, property payments. These departments, and I will
specifically refer to Education, are at the same time facing
spending pressures against Compensation of Employees which could
be at least in part absorbed if the cost-cutting measures were
This also means that government, first of all,
has to be able to spend what it has. Underspending has to be
tackled head-on, with more focus on management of all
infrastructure projects funded from the equitable share and all
special projects funded by conditional grants, for some of which
these adjustments, once again, provide rollovers. Here we urge
the relevant MECs to focus more vigorously on future spending of
the National Schools Nutrition Programme, and the Comprehensive
HIV/Aids Grant. And we urge Provincial Treasury to see to it
that they do.
We are happy to see that the province has
exceeded its targets for collection of own revenue. However,
some areas of concern remain, especially under-collection of
patient fees by the Department of Health, which is a going
concern and also a warning sign as the government strives to
improve management of public healthcare ahead of the
implementation of the National Health Insurance in the next
financial year and beyond.
We would also like to see a fully operational
Liquor Entity able to meet projections for the collection of
revenue from liquor licences. We are aware of the delay in the
promulgation of this legislation and the delays that ensued in
the collection of revenue from liquor licences. We have also
received assurances that a new KZN Gaming and Betting Board will
be operational within weeks and that it will further improve
collection of revenue from this source.
The good news is that we now appear to be
compensated in full for all unfunded mandates stemming from
higher than anticipated wage agreements and various OSDs as long
as we can budget for them appropriately.
We also hope that the province will receive
funding on time for the full implementation of the upcoming
unfunded mandates in COGTA, namely salaries for izinduna,
Traditional Council secretaries and ward committee members as
soon as these changes are signed into law.
We appreciate investments by municipal
transfers towards the development of Prince Mangosuthu Buthelezi
Airport in Ulundi and Richards Bay Airport following a similar
investment into Pietermaritzburg airport. We see this as a good
example of good intergovernmental relations, but we are
wondering why it has taken this government so long to discover
the economic potential of the wider regions these airports
We appreciate the additional funding allocated
in these adjustments to COGTA towards all traditional council
elections. These elections were scheduled to take place in
December but have been postponed until next year due to flawed
planning. Will this delay have financial implications beyond the
Yesterday I raised some concerns about the
contract between Department of Health and the National Health
Laboratory Services. This is essentially an underfunded mandate
and if the contract cannot be renegotiated, we should be
approaching National Treasury directly for the funding of future
shortfalls as a result of the uncompetitive prices charged by
We welcome continued investment by Provincial
Treasury into programmes that promote efficiency within
government. The two recent initiatives I would like to single
out are: the Infrastructure Crack Team and the hotline where
service providers contracted to government can follow up unpaid
invoices. We will appreciate regular briefings on these
On the related subject of Treasury’s
programmes in the fight against fraud and corruption we feel
that these efforts are constrained by an absence of specific
targets. The Special Investigating Unit estimates that the South
African government loses roughly R30-billion a year to financial
leakage. This in effect mean.............tate coffers to corrupt government
officials every year.
Although efforts on the part of Provincial
Treasury and the Office of the Premier with its dedicated
Integrity Unit in enforcing regulations and closing down
loopholes are impressive, it is disappointing that the
provincial government has not set clear targets for reducing the
volumes of public money lost through corruption every year.
We propose that such targets be put in place
so that the process of combating fraud and corruption can be
measured against tangible objectives. It is a fact that
objectives that cannot be measured, cannot be managed.
Having said that, I conclude by pledging the
IFP’s support for the 2011 Adjustments Estimate Bill.
I thank you.
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