REUTERS

Finance Minister Pravin Gordhan. Photo: Reuters

Finance Minister Pravin Gordhan said he had taken the advice of Amanda Mzulwini to “spend money on things that matter, like improving healthcare, building more schools in the rural areas and building clinics” in his Budget.

In an address which highlighted poverty alleviation and quality of life, in addition to the economy, Gordhan plugged education, job creation and an improvement in the social security system – which provides a safety net for nearly a third of the population – as central government priorities.

“Education, health and social assistance will remain the largest categories of expenditure … Investment in people is at the centre of our growth and development strategy,” Gordhan said.

A total of R615.7 billion will go to social services – education, health, housing and social grants – making up 58 percent of government expenditure in the year ahead, up from 49 percent a decade ago.

Gordhan said the government funded largely free services at public health facilities and no fee schools for 60 percent of learners, as well as paying for housing, water and electricity in poor communities. However, he also emphasised that redistribution was not a substitute for economic growth and job creation.

Gordhan said the nearly 16 million South Africans who received social grants would benefit from expenditure of R105bn in 2012/13, increasing to R122bn in 2014/15.

“With effect from April, the monthly state old age pension and the disability and care dependency grants will rise by R60 a month to R1 200, or R1 220 for pensioners over the age of 75. Foster care grants will increase by R30 to R770 and the child support grant will increase to R280,” he said, adding that “we are mindful that these increases may need to be reassessed if inflation continues to rise.”

Education – which receives the lion’s share of the social services budget – will grow from R207bn in 2012/13 to R236bn in 2014/15.

Of that, three quarters – or R152.1bn – will be spent on Basic Education – a 4.6 percent increase from last year. Tertiary education has jumped a substantial 13.9 percent over last year, to R31.3bn in expenditure.

Vocational and continuing education training is up 5.6 percent to R14.4bn.

Showing a strong push for increased employment opportunities, Gordhan said an additional R4.8bn over the 2012 MTEF period would go to the government’s expanded public works programme, bringing its allocations to a total of R77.8bn.

* “The community work programme receives an additional R3.5bn, which gives it a total of R6.2bn, enabling the number of people employed to increase to 332 000 in 2014/15 from 90 000 in March 2011,” Gordhan said.

* “Working for Water and Working on Fire receive an additional R1.1bn (a total of R7.7bn) providing for a total of 135 000 jobs over the medium term;

* The non-state sector programme receives an additional R345m (a total of R1.1bn).

* The National Rural Youth Service Corps receives an additional R200m (a total of R900m) over the next three years;

* R300m is added to the arts and culture sector for job creation.”

In line with the focus on infrastructure highlighted in President Jacob Zuma’s State of the Nation Address, Gordhan said investment in municipal infrastructure and human settlements would increase from R120bn in 2012/13 to R139bn in 2014/15.

Turning to health, which receives R121.9bn, Gordhan said the sector had been allocated an additional R12.3bn for the next three years, with R1bn allocated to national health insurance pilot projects and increasing primary health care visits.

Gordhan said the government’s medium-term priorities in health spending included hospital infrastructure, the comprehensive HIV and Aids treatment and prevention programme and expanding health professional training.

“Progress in these areas will strengthen the public health system, paving the way for the introduction of national health insurance.”

According to the Budget Review, the national health insurance will be implemented over a 14-year period, starting this year. Preparations include an audit of more than 4 000 public sector facilities.

Gordhan said R450m had been provided to upgrade some 30 nursing colleges, while 426m would go to initial rebuilding work on five major tertiary hospitals. A further R968m had been made available for antiretroviral treatments.