Trade union federation and key ANC alliance partner Cosatu has slammed the medium term budget policy statement and its proposed allocation of revenue for making little mention of rampant corruption and wasteful expenditure at provincial government and municipal level.
Cosatu and the SA Local Government Association (Salga), which represents municipalities, appeared before parliament’s select committee on appropriations on Tuesday to discuss the medium term budget policy statement (MTBPS) presented by finance minister Enoch Godongwana earlier in November.
“A culture of simply handing over billions of rand to provinces and municipalities with little accountability and few consequences for criminal wrongdoing cannot continue,” Cosatu’s parliamentary co-ordinator, Matthew Parks, said of the number of poor audit opinions, especially at municipal level.
Audits of municipalities show governance is regressing in in most of SA’s 257 municipalities with fruitless, wasteful, and unauthorised expenditure remaining a serious problem.
“Cosatu is disappointed that the DORA [division of revenue amendment] bill and the MTBPS are silent on the litany of damning finds by the auditor-general on the rampant corruption and wasteful expenditure in our provincial government and more especially in countless municipalities,” Parks said.
He said Cosatu hopes the main budget, which is due to be presented in February deal with corruption and wasteful expenditure and decisively “tackle the dysfunctionality that has come to mark so many municipalities.”
“Voters have spoken clearly to the ANC and the government: ‘get your house in order before it’s too late’,” Parks said, referring to the ANC’s poor showing at the recent local government elections.
Over the 2022 medium term expenditure framework period, transfers to provinces and municipalities will grow below inflation. This could compromise service delivery — including the provision of basic services such as water and sanitation — especially in poor areas.
Provinces are responsible for basic education and health services, roads, housing, social development, and agriculture, while municipalities provide basic services such as water, sanitation, electricity distribution, roads and community services.
Over the next three years, government proposes to allocate 48.4% of available non-interest expenditure to national departments, 42% to provinces and 9.6% to local government.
Allocations to provinces will drop over the medium term. In the 2021/2022 financial year, provinces were allocated R661bn. This will decrease to R658bn in 2022/2023 and to R647bn in 2023/2024, before increasing to R676bn in 2024/2025 financial year.
Allocations to local government will increase slightly over the medium term — R146bn in 2022/2023; R148bn in 2023/2024; and R158bn in 2024/2025.
Salga councillor Bongani Baloyi said organised local government acknowledged the tough economic outlook and limited fiscal space that has been worsened by Covid-19 pandemic.
“The proposed increase in the allocation to local government over the next three years will gradually bring to reality the promise contained in the White Paper on Local Government of an equitable share of nationally raised revenue. Consequently, organised local government supports the proposal,” Baloyi said.
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