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In a briefing by National Treasury officials to the Select Committee on Appropriations yesterday it was confirmed that once the budget adjustments proposed by National Treasury have been approved by Parliament, South Africa will have no contingency reserve.

This reserve is normally held for unexpected or emergency expenditure. The Minister of Finance, Pravin Gordhan, has however allocated the budgeted reserve to pay for increased budget expenditure  primarily on public servants salaries.

In the original budget for 2012/2013, a contingency reserve of R 5.8 billion was provided  to fund potential unexpected and unavoidable expenditure such as floods, droughts and other disasters.

In a move to negate the impact of an R11.5 billion increase in government spending, most notably an additional R5.5 billion being spent on public service salaries, the Minister of Finance has now allocated the contingency reserve for the entire year.

The financial year is far from over. The summer season of storms has only just begun, and yet we now have no contingency funding for any disasters that may arise.
Once again the ANC government has put its COSATU aligned interests ahead of the interests of the country.

The public service unions were given an increase way above what was budgeted for, with scant concern for where the money would come from.

Even the R450 million upgrade of the Mthatha airport has been put ahead of maintaining the contingency reserve. Another R 118.3 million has also been allocated to the problematic Denel SAAB Aerostructures project debacle that seems set to continue to 2021. R379 million has been allocated to provincial and municipal governments for the African Cup of Nations tournament.

The DA will write to the Minister of Finance to express its concern about the risk that now exists for the country. The allocation of the contingency reserve has left us vulnerable and ill-equipped to respond to possible disasters and other unforeseen expenditure demands.