The government plans to close programmes it has identified as low priority or low performing from next year as part of widespread spending cuts aimed at enhancing fiscal discipline amid declining revenue and stagnant growth.
The government also plans to introduce additional requirements for infrastructure programmes and projects that are planned, procured, contracted and implemented in provinces and municipalities, and to begin a process of verifying “ghost workers” on the government’s payroll.
These decisions, outlined in finance minister Enoch Godongwana’s budget on Wednesday, follow the withdrawal of the one percentage point increase in VAT over the next two years, requiring the government to cut spending in areas where it can.
“New reforms will target infrastructure planning and implementation across provinces and municipalities,” said Godongwana in his budget speech.
The exercise will target public employment and active labour market programmes identified in a 2024 review by the National Treasury, which found that “while the portfolio is comprehensive, the effectiveness and efficiency of individual programmes is mixed”.
“The budget process will be redesigned to close low-priority or underperforming programmes and achieve greater efficiency in procurement, ICT and infrastructure management,” the Treasury said in budget documents released on Wednesday.
The decision by the Treasury follows various decade-long spending reviews conducted by government departments, which identified savings of R37.5bn that can be achieved from changes to operating models and improvements in oversight.
“In some cases, programmes no longer achieve their intended objectives and should be closed,” the Treasury said.
The Treasury says the previous process to identify ghost workers was unsuccessful as it relied on “inefficient census methodology”.
“A data-driven approach to detecting payroll irregularities will replace the more costly method of using censuses. This initiative will cross-reference administrative data sets to identify ghost workers and other anomalies across government departments,” Godongwana said.
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