Durban - No more bottled water at meetings; no more catering at meetings; team-building exercises and year-end functions are banned. These are some of the unprecedented austerity measures which were revealed by KZN Finance MEC Ina Cronjé in her budget speech in Pietermaritzburg on Tuesday.
She also announced a rationalisation of overseas trips by government employees in her long list of measures to curb wasteful provincial government expenditure. The move accompanies KwaZulu-Natal’s facing a reduction of its equitable share of the national Budget owing to KZN’s now having a smaller proportion of the population.
The results of the 2011 Census, which showed that Gauteng had overtaken KZN as the province with the largest population, are now being used to calculate a new equitable share of the national Budget.
KZN gets R88 billion for 2013, which is still the largest stake of the equitable share. However, its reduced share of the population will see its equitable share of the national pie cut by R5.68bn over the next three years.
“The 2013/2014 medium-term expenditure framework budget is certainly one of the most difficult ones the province has had to contend with,” Cronjé said.
The cuts, as a result of the Census data, actually totalled R6.77bn, but “buffer funding” would be received from the National Treasury to cushion the impact of the changes.
Cronjé said there was no doubt that the baseline cuts brought about by the 2011 Census data were “significant”. She warned that buffer funding provided to the province would fall away after 2015/16 as part of the medium-term expenditure framework budget, which meant KZN needed to plan now and provide long-term solutions to mitigate the reduction in funds.
“Departments were urged… not to cut any service delivery spending areas as far as possible, especially infrastructure budgets. The directive given was to focus on efficiency savings, with an expanded set of cost-cutting measures implemented in all departments and public entities,” she said.
Cronjé said the measures were “a pillar of good governance”. The government would closely monitor the adherence to these cost-cutting measures, and transgressing departments would be called upon to answer.
“It is the basic way of how we should run the government, and we are cutting the wasteful expenditure because it does not help our people. The message is clear that we have to do more with less,” she said.
The head of the KZN Treasury, Simiso Magagula, said: “Some departments… have tried to suggest that these measures would affect service delivery. But some government officials earn more from subsistence and travelling allowances than from their salaries.”
He said the province was not going to overspend in the current financial year because of these cost-cutting measures.
“Just to indicate to you, as of February this year, the province had R5bn in its account,” said Magagula.
The province had suffered a “double whammy” because over and above the allocation reduction, the National Treasury had also decided to impose a 1 percent reduction of allocation to all government agencies.
This reduction, brought about by the decline in revenue collection by the National Treasury, put further pressures on KZN finances.
The Mercury