“Our optimism was understandably premised on the expected improvement in business confidence due to the positive policy changes announced by President Cyril Ramaphosa,” he said.
“However, our economic growth has remained subdued for most of the post 2008 period partly due to insufficient growth in global demand.
“More recently the negative domestic supply shocks such as drought and electricity supply, perceptions of policy uncertainty and the slow pace in implementing much needed economic reforms have emerged as key binding constraints potentially limiting fixed investment in agriculture, mining and manufacturing,” he said.
He said the province only received R60m for roads affected by disaster from the national fiscus for this year’s financial adjustments.
“As a result, provincial treasuries are expected to carefully cash-manage their revenue funds and to manage the commitments of the province to ensure a sustainable in-year financial position.”
He said R115m had been allocated to the department of public works to ensure property rates and taxes were paid to municipalities.
“This is to ensure that as government we pay for services rendered, accordingly, communities and businesses should do likewise.”
He said that economic growth had severely constrained the government’s fiscal resources.
“This calls for us to put fiscal consolidation at the core of the provincial government’s medium-term budget strategy and prudent fiscal management practices.”
“Key fiscal consolidation measures will be directed at cost containment measures on noncore items, managing wage bill and medico legal and enhancing own revenue generation,” he said.
“Despite the budget pressures and sluggish economic growth, we remain committed to fiscal sustainability, measures to manage and reduce budget pressures and constantly implement expenditure ceilings and enhance the provincial own revenue.”
He said the department was concerned about the continued feedback from the Auditor-General on irregular expenditure.
“I must hasten to add that department of education remains a concern for the province on this front, and this is where we need to focus our energies going forward.
New litigation unit to tackle EC government malpractice claims
Image: Werner Hills
A litigation unit will be set up in premier Oscar Mabuyane’s office to manage medical negligence cases.
Acting finance MEC Nonkqubela Pieters said while delivering the medium term budget policy statement on Thursday that R3.2m had been set aside the establish the unit.
Finance MEC Mlungisi Mvoko has been booked off sick.
The Eastern Cape department of health spent R630m on medical malpractice claims during the 2018/19 financial year.
The countless medical malpractice claims have had major affect on the department’s budget for years.
Pieters said while it was needed to develop the economy, investments also had to be made in people.
“We have, therefore, committed R77m to the department of health for the National Health Insurance (NHI) and HR Capitation grant to hire health professionals to protect health outcomes of the province.”
It was impossible to continue with “business as usual” in the current economic conditions.
“But service improvement initiatives, both qualitatively and quantitatively, cannot be compromised.”
“Our point of departure for this adjustment is that the fiscal resources of our country are depleted, national debt has exceeded R3trn and the economy is not growing enough to create new jobs, thus leading to a constrained tax base.”
When he tabled the tabled the 2019/20 Medium Term Expenditure Framework in March, Mvoko said he was optimistic that the global economic outlook would improve.
“Our optimism was understandably premised on the expected improvement in business confidence due to the positive policy changes announced by President Cyril Ramaphosa,” he said.
“However, our economic growth has remained subdued for most of the post 2008 period partly due to insufficient growth in global demand.
“More recently the negative domestic supply shocks such as drought and electricity supply, perceptions of policy uncertainty and the slow pace in implementing much needed economic reforms have emerged as key binding constraints potentially limiting fixed investment in agriculture, mining and manufacturing,” he said.
He said the province only received R60m for roads affected by disaster from the national fiscus for this year’s financial adjustments.
“As a result, provincial treasuries are expected to carefully cash-manage their revenue funds and to manage the commitments of the province to ensure a sustainable in-year financial position.”
He said R115m had been allocated to the department of public works to ensure property rates and taxes were paid to municipalities.
“This is to ensure that as government we pay for services rendered, accordingly, communities and businesses should do likewise.”
He said that economic growth had severely constrained the government’s fiscal resources.
“This calls for us to put fiscal consolidation at the core of the provincial government’s medium-term budget strategy and prudent fiscal management practices.”
“Key fiscal consolidation measures will be directed at cost containment measures on noncore items, managing wage bill and medico legal and enhancing own revenue generation,” he said.
“Despite the budget pressures and sluggish economic growth, we remain committed to fiscal sustainability, measures to manage and reduce budget pressures and constantly implement expenditure ceilings and enhance the provincial own revenue.”
He said the department was concerned about the continued feedback from the Auditor-General on irregular expenditure.
“I must hasten to add that department of education remains a concern for the province on this front, and this is where we need to focus our energies going forward.
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