Date: 21/11/2006
Soure: Gauteng Provincial Government
Title: Mashatile: Medium Term Budget Policy Statement
Speech by Gauteng MEC for Finance and Economic Affairs MEC Paul Mashatile at the tabling of the Medium Term Budget Policy Statement (MTBPS) and the Provincial Adjustment Appropriation Bill
Comrade Speaker
Honourable Premier, Mbhazima Shilowa
Honourable Members of the Executive Council
Honourable Members of the House
Ladies and gentlemen
It is now the second year, since 1994, that we are tabling the Medium Term Budget Policy Statement to this House. To us this is a significant development as it indicates that our budgeting process has indeed come of age.
The MTBPS is an important step forward in the budgeting process. It outlines our strategic priorities and the total revenue that we will use to fund these priorities over the next three years. It gives practical meaning to our commitment to open, transparent and co-operative policy making and is therefore an important milestone in our ongoing effort to deepen the gains of our democracy.
In addition to the Medium Term Budget Policy Statement, we are also tabling the Adjustment Appropriation Bill for the 2006/07 financial year. This Bill will revise allocations made during the 2006/07 Budget Speech in February this year.
Our progress thus far
As we table these documents, we are mindful of the success and challenges we face in delivering on the pledge we made to our people in the 2004 elections. As indicated in our mid-term review; we continue to make significant progress in meeting the priorities we identified in our Five Year Strategic Plan.
We are on course towards meeting our strategic objective of enabling faster economic growth and job creation. The provincial economy has strengthened steadily since 1996. This positive trend in the growth of the provincial economy is expected to continue into the future.
Business confidence in Gauteng is on the rise. This can be seen by the increased investment the private sector is making in the provincial economy. According to the Gauteng Business Barometer, in 2005 business activity in Gauteng increased by 10,7% compared to the year 2004. Between 2000 and 2005, net capital investment grew by 17,2 %.
These developments indicate to us that we are on course towards growing the Gauteng economy at a rate of eight percent by 2014.
We are beginning to make a dent on unemployment. Job creation in our province averaged around 13% between September 2004 and 2005. Job advertisements in Gauteng newspapers increased by 38%, over the past few years. We, however, wish to caution that a lot more needs to be done to create further employment opportunities.
The launch of a comprehensive provincial Agricultural Development Strategy, which includes bio-technology and agro processing, will go a long way in addressing some of the challenges faced by the agricultural sector in our province. Most importantly, it will contribute to our overall objective of halving poverty and unemployment.
The implementation of our Broad-Based Black Economic Empowerment (BBBEE) Strategy and the support for Small, Medium and Micro Enterprises (SMMEs) we are offering through the Gauteng Enterprise Propeller, has gone a long way in expanding access to economic opportunities and bridging the divide between the first and the second economy.
Our comprehensive urban renewal programme to upgrade social and economic infrastructure in 20 priority townships across Gauteng is one of the key interventions that will take us closer to the objective of fighting poverty and building safe, secure and sustainable communities.
In line with our vision to position Gauteng as a Globally Competitive City Region (GCR), local government is also engaged in a number of infrastructure projects aimed at fighting poverty and building safe, secure and sustainable communities. The launch of the Gauteng Safety Strategy will also contribute towards this objective.
In pursuance of the objective of building healthy, skilled and productive people, we continue to implement our retention strategy for health professionals. We also launched the Human Resources Development Strategy and intensified our learnership and internship programmes.
Furthermore, a comprehensive treatment and care programme, including antiretroviral treatment is now implemented in 34 health facilities. Since inception in 2004 this programme has benefited more than 41 000 clients who were put on antiretroviral treatment.
As part of our quest to deepen democracy and promote constitutional rights, we continue to pay attention to the emancipation of women, the youth and people with disabilities.
Through our programme of Izimbizo, we continue to interact with our people and offer them an opportunity to influence government policies and programmes.
The deployment of skilled professionals such as engineers and accountants to municipalities is underway. The provincial Treasury is also working with municipalities to assist them in strengthening financial management capacity.
The results of these interventions are starting to bear fruit and place us firmly on track towards our objective of building an effective and caring government.
The ongoing programme of rolling out Information and Communications Technology (ICT) infrastructure across the province will also improve access to government services and contribute to the creation of an efficient government.
Honourable Speaker, what I have just described is a true reflection of what the ruling party in government, based on the African National Congress's (ANC's) election manifesto, continues to deliver to the people of Gauteng. It is these facts that are beyond contention, which indicate to us that a better Gauteng is in the making.
We are on track towards delivering on the promises we made to our people back in 2004. However a lot more still needs to be done.
To sustain our momentum there is an urgent need to further strengthen intergovernmental planning, co-ordination and implementation. This is the essence of the GCR.
Joint planning and implementation will ensure that we maximise the impact of our collective interventions aimed at delivering on our mandate. We must also form strategic partnerships with the private sector towards the achievement of our collective objectives. We must also pay attention to strengthening the capacity and organisation of the state.
Medium Term Budget Policy Statement
When we presented the 2006/07 Medium Term Expenditure Framework (MTEF) Budget, we tabled a deficit budget with expenditure exceeding revenue of R783,8 million in the 2006/07 financial year. After the adjusted budget the deficit has decreased to R610,5 million.
In the 2007/08 financial year, the deficit will be reduced further to R32,2 million and will be financed from reserves in the Provincial Revenue Fund. We wish to reiterate that our fiscal position remains stable and continues to be governed by sound principles of fiscal management.
Expenditure for the 2006/07 financial year is adjusted from R34,4 billion to R35,2 billion, increasing to R36,0 billion and to R38,5 billion in the two outer years of the MTEF. It is anticipated that from the current financial year expenditure will increase by R4 billion over the MTEF.
Total expenditure includes more than R17 billion allocated for special projects over the MTEF. These projects, which include Gautrain and the implementation of the provincial Growth and Development Strategy, are aimed at stimulating the growth of the provincial economy in order to ensure that we reach our target of eight percent growth by 2014.
Capital expenditure over the MTEF will rise to more than R35 billion. Collectively with local government we have committed ourselves to investing more than R50 billion over the next five years for infrastructure development across Gauteng.
We believe this massive investment in infrastructure will further stimulate economic growth, reduce unemployment, create new nodes of economic activity and contribute to our overall objective of changing the lives of our people for the better.
While we pay attention to funding infrastructure investment we will not lose sight of the equally important need to adequately fund social services. We wish to reiterate that social services such as health, education, community safety and social development will remain adequately funded over the MTEF.
This we will do in order to enhance social cohesion and to respond to the realisation that sustainable and vibrant communities require jobs but also they require safe neighbourhoods, quality schools and clinics as well as recreational facilities.
Easing the burden on the fiscus
Comrade Speaker, the solid performance of the economy and the sound management of public finances have provided us with the capacity and resources to increase service delivery.
Sound economic policy choices made in the early 1990s are making it possible for additional allocations to be made available for our key priorities.
However there are challenges that continue to put a strain on the fiscus. In-migration into Gauteng has resulted in a huge increase in population. According to the mid-year estimates, there are currently 9,4 million people living in Gauteng. This puts serious pressure on available resources. Changes in provincial boundaries that have seen areas such as Winterveldt, Ekangala and Mabopane being incorporated into Gauteng also present new challenges for the fiscus.
To address existing and new pressures on the fiscus, there is a need to constantly look at ways of optimising provincial revenue and easing the burden on the fiscus. In this regard, a feasibility study which proposes a provincial tax has been completed and will be presented to the Executive Council for deliberations shortly.
Other mechanisms of optimising provincial revenue which are currently being explored include the tolling of existing and future freeways. This will allow us to raise private sector funding for the maintenance and construction of high order roads. Funds from the fiscus will then be channelled towards secondary and primary roads, particularly in our townships. Blue IQ Holdings is in the process of being restructured to allow it to raise funding against its balance sheet. Equally, the Gauteng Enterprise Propeller will be corporatised and restructured to allow it to use seed funding from the fiscus to gear-in private sector funding to assist SMMEs and BBBEE companies.
A process to set up a Private Equity Fund jointly with the Metro municipalities is also underway. The Gauteng Partnership Fund is currently attracting private sector funding into the social housing market. These initiatives will be strengthened into the future.
Private sector funding, including the use of Public, Private Partnerships (PPP) for infrastructure investment will be strengthened into the future. A process led by Blue IQ for the roll out of ICT infrastructure in partnership with private sector, is also under investigation.
Comrade Speaker, we are undertaking all these initiatives in order to ease the burden on the fiscus so that we can channel more funding to our other priorities. Over the MTEF we will accelerate the implementation of our programmes.
Our focus will be on ensuring that we achieve maximum impact in addressing the challenges facing the poor and marginalised in our province. Over the next three years we will pay attention to the following:
* implementation of the Global City Region Perspective
* implementation of the Growth and Development strategies
* the Integrated 2010 Strategy * implementation of the 20 priority townships initiative
* integrated infrastructure strategy
* the Gauteng Safety Strategy
* implementation of the Social Development Strategy
* implementation of the Human Resource Development Strategy
* strengthening the capacity and organisation of the state
* integrated Youth and Women development strategies.
We wish to reiterate that these strategies are now in place. The challenge going forward is to accelerate their implementation. The Gauteng Treasury will await business plans for these Strategies so that they can be resourced.
Provincial adjustment appropriation bill of 2006
Honourable members, having outlined our priorities over the MTEF, I will now present the Provincial Adjustment Appropriation Bill of 2006. This Bill will revise the Appropriation Act of 2006 that was approved by the House in February this year.
The Appropriation Act of 2006 approved total expenditure amounting to R34,4 billion and estimated revenue of R33,8 billion. The adjusted budget we are tabling today provides for an upward revision of revenue to R33,9 billion. Expenditure is also revised upwards from R34,4 billion to R35,2 billion.
The increase in expenditure takes into account additional conditional grants from national government amounting to R110,7 million, rollovers of R236,6 million, unforeseeable and unavoidable expenditure allocations of R143,5 million and other adjustments of R332,4 million. I will now move to allocations for individual departments.
Department of Health
The Department of Health receives an additional R255 million raising its allocation from R10,4 billion to R10,6 billion in the 2006/07 financial year. The additional resources will be used for hospital revitalisation and forensic pathology services. An additional amount of R17,5 million has been allocated for the comprehensive HIV and AIDS programme.
Furthermore, we are allocating an amount of R21 million to this department for the replacement of old computers in hospitals. An additional amount of R11 million is set aside for the transformation of and the Public, Private Partnership for the Chris Hani Baragwanath Hospital.
An amount of R2 million is made available to accommodate higher salaries and related expenditure being paid to provincial staff. An additional R20 million is set aside for the prevention and treatment of extreme drug resistant (XDR) Tuberculosis.
We are also allocating an additional amount of R28 million to the department of Health to cover the shortfalls in the budgets of Dr Charles Hurwitz, Tsepong and East Rand hospitals which have arisen due to provincialisation.
An amount of R106,8 million will be suspended from the Department of Health to various departments for the HIV and AIDS project, which will be co-ordinated by the Department of Health.
Comrade Speaker, we remain committed to the development of healthy and sustainable communities in our province.
Department of Education
The Budget for the Department of Education increases from R12,2 billion to R12,4 billion. We have approved an additional amount of R129,4 million to fund incentives for educators.
The department will suspend R7,2 million to the Gauteng Shared Services Centre for the employee assistance programme. It is estimated that about 43 000 employees of the department benefit from this service.
We have made these allocations in order to boost efforts aimed at promoting skills development as a key intervention to drive economic growth and job creation.
Department of Social Development
The Department of Social Development receives an additional allocation of R52,8 million raising its budget from R981 million to R1 billion. We have approved a roll over of R4,7 million for this department to fund commitments which existed at the end of the financial year for the ongoing integrated social services programme.
An amount of R21,6 million is suspended from this department's capital budget to the Department of Public Transport, Roads and Works for the maintenance, upgrading and rehabilitation of buildings which include upgrading facilities at Walter Sisulu and Tutela Places of Safety and the planning for new prototype secure facilities.
Comrade Speaker, our commitment to ensuring social cohesion remains unquestionable.
Department of Housing
The total Budget for this department increases from R2,0 billion to R2,1 billion. An amount of R81,8 million was approved for ongoing projects in Alexandra as part of the Alexandra Renewal Project. Additional rollovers of over R2,6 million were also approved for this department.
Department of Local Government
An additional allocation of R45,8 million has been set aside for the Department of Local Government increasing its total budget from R160,3 million to R206,1 million. The bulk of this funding will be used to support municipalities.
Department of Public Transport, Roads and Works
The total budget for this department increases from R6,22 billion to R6,25 billion. Included in the allocation for this department is an amount of R163 million for improving provincial infrastructure.
Office of the Premier
An amount of R2,5 million has been allocated to the Government Communication and Information Services programme within the Office of the Premier. These funds will be used for the publication of the Midterm Review Report which reflects progress and challenges with regard to the implementation of our five year strategic priorities. The total Budget for the Office of the Premier is adjusted to R117,1 million.
The Provincial Legislature
The total budget for the provincial Legislature increases from R129 million to R146,2 million. Rollovers to the amount of R959 000 were approved for the purchase of office furniture and equipment as well as the finalisation of the Legislature's information management system project.
An additional amount of R11,1 million was approved for the Legislature to fund pressures on overseas travel expenses and visits associated with activities of the CommonWealth Parliamentary Association.
An additional R4,6 million has been approved to limit funding pressures on the 2006/07 budget of the Legislature.
The Department of Agriculture, Conservation and Environment
This department receives and additional allocation of R335 000 from national transfers to augment the Land Care Programme Grant. The total budget for this department increases from R241,8 million to R243,2 million. An amount of R3 million is suspended from this department to the Department of Public Transport, Roads and Works for construction works at the Suikerbosrand Nature Reserve and the maintenance of natural reserves.
A further R850 000 is suspended to the Department of Education for the Bontle ke Botho prize money.
The Department of Community Safety
The total budget for the Department of Community Safety increases from R220,1 million to R222,3 million. An amount of R31 million has been allocated to this Department for Road Safety projects.
The Department of Sports, Arts, Culture and Recreation
The total budget for this department increases from R221,2 million to R263,2 million. A roll over amount of R17 million has been approved for this department. This includes a capital amount of R14 million approved for upgrading the Rand Stadium.
An additional amount of R21 million was made available to this department to host soccer's major international exhibition, Soccerex. The hosting of this event will contribute towards the growth of the provincial economy and will enhance Gauteng's position as a Home of Champions and a home of Competitive Sport.
The Gauteng Shared Services Centre
The total budget for this Department increases from R751,3 million to R776,8 million. Included in the increased allocation for this department is an amount of R9,7 million allocated for the Vodacom Call Centre training project.
The Gauteng Treasury
The total budget for the Provincial Treasury declines from R70,4 million to R61,1 million. The decline is as a result of the fact that Treasury has suspended R5,2 million to various departments for strengthening the capacity of the Offices of Chief Financial Officers.
Treasury also surrendered an amount of R4 million to the Department of Health for the appointment of a transaction adviser to speed up the implementation of the Chris Hani Baragwanath PPP project.
The Department of Economic Development
The total budget for the Department of Economic Development increases from R572 million to R665 million. The additional allocation will cover among others a R10,5 million allocation to the Gauteng Gambling Board, which will be refunded to the North West Province. This follows the completion of the demarcation process that has seen Morula Sun now becoming part of Gauteng. Also included in the allocation for this department is an amount of R68 million for the Automotive Supplier Park and R10 million for the Blue Umbrella project.
Organisational and personnel implications
An amount of R70,5 million has been allocated to various departments to fund the Government Employees Medical Scheme. Treasury will monitor the use of these funds to ensure that they are not diverted into other areas.
Comrade Speaker, we have allocated the additional resources at our disposal in a manner that will ensure that we deliver on the promise we made to our people in 2004.
Our immediate task is to ensure that these funds are spent and that we accelerate the implementation of our programmes. We must continue to be intolerant to both over and under-expenditure.
Furthermore, we must continue to strengthen our capacity to deliver on our programmes.
I wish to take this opportunity to thank the Premier and my colleagues in the Executive Council for their political support and insights. A word of gratitude also goes to Heads of Department and administrative staff from my and other departments, for their technical support and advice in developing the Adjustment Bill and the Medium Term Budget Policy Statement.
I now table the following documents for consideration by this House:
* the Provincial Adjustment Appropriation Bill of 2006
* the Explanatory Memorandum to the Bill
* the Medium Term Budget Policy Statement of 2006
* a copy of my speech.
Ke a leboga.
Issued by: Department of Finance and Economic Affairs, Gauteng Provincial Government
21 November 2006
Soure: Gauteng Provincial Government
Title: Mashatile: Medium Term Budget Policy Statement
Speech by Gauteng MEC for Finance and Economic Affairs MEC Paul Mashatile at the tabling of the Medium Term Budget Policy Statement (MTBPS) and the Provincial Adjustment Appropriation Bill
Comrade Speaker
Honourable Premier, Mbhazima Shilowa
Honourable Members of the Executive Council
Honourable Members of the House
Ladies and gentlemen
It is now the second year, since 1994, that we are tabling the Medium Term Budget Policy Statement to this House. To us this is a significant development as it indicates that our budgeting process has indeed come of age.
The MTBPS is an important step forward in the budgeting process. It outlines our strategic priorities and the total revenue that we will use to fund these priorities over the next three years. It gives practical meaning to our commitment to open, transparent and co-operative policy making and is therefore an important milestone in our ongoing effort to deepen the gains of our democracy.
In addition to the Medium Term Budget Policy Statement, we are also tabling the Adjustment Appropriation Bill for the 2006/07 financial year. This Bill will revise allocations made during the 2006/07 Budget Speech in February this year.
Our progress thus far
As we table these documents, we are mindful of the success and challenges we face in delivering on the pledge we made to our people in the 2004 elections. As indicated in our mid-term review; we continue to make significant progress in meeting the priorities we identified in our Five Year Strategic Plan.
We are on course towards meeting our strategic objective of enabling faster economic growth and job creation. The provincial economy has strengthened steadily since 1996. This positive trend in the growth of the provincial economy is expected to continue into the future.
Business confidence in Gauteng is on the rise. This can be seen by the increased investment the private sector is making in the provincial economy. According to the Gauteng Business Barometer, in 2005 business activity in Gauteng increased by 10,7% compared to the year 2004. Between 2000 and 2005, net capital investment grew by 17,2 %.
These developments indicate to us that we are on course towards growing the Gauteng economy at a rate of eight percent by 2014.
We are beginning to make a dent on unemployment. Job creation in our province averaged around 13% between September 2004 and 2005. Job advertisements in Gauteng newspapers increased by 38%, over the past few years. We, however, wish to caution that a lot more needs to be done to create further employment opportunities.
The launch of a comprehensive provincial Agricultural Development Strategy, which includes bio-technology and agro processing, will go a long way in addressing some of the challenges faced by the agricultural sector in our province. Most importantly, it will contribute to our overall objective of halving poverty and unemployment.
The implementation of our Broad-Based Black Economic Empowerment (BBBEE) Strategy and the support for Small, Medium and Micro Enterprises (SMMEs) we are offering through the Gauteng Enterprise Propeller, has gone a long way in expanding access to economic opportunities and bridging the divide between the first and the second economy.
Our comprehensive urban renewal programme to upgrade social and economic infrastructure in 20 priority townships across Gauteng is one of the key interventions that will take us closer to the objective of fighting poverty and building safe, secure and sustainable communities.
In line with our vision to position Gauteng as a Globally Competitive City Region (GCR), local government is also engaged in a number of infrastructure projects aimed at fighting poverty and building safe, secure and sustainable communities. The launch of the Gauteng Safety Strategy will also contribute towards this objective.
In pursuance of the objective of building healthy, skilled and productive people, we continue to implement our retention strategy for health professionals. We also launched the Human Resources Development Strategy and intensified our learnership and internship programmes.
Furthermore, a comprehensive treatment and care programme, including antiretroviral treatment is now implemented in 34 health facilities. Since inception in 2004 this programme has benefited more than 41 000 clients who were put on antiretroviral treatment.
As part of our quest to deepen democracy and promote constitutional rights, we continue to pay attention to the emancipation of women, the youth and people with disabilities.
Through our programme of Izimbizo, we continue to interact with our people and offer them an opportunity to influence government policies and programmes.
The deployment of skilled professionals such as engineers and accountants to municipalities is underway. The provincial Treasury is also working with municipalities to assist them in strengthening financial management capacity.
The results of these interventions are starting to bear fruit and place us firmly on track towards our objective of building an effective and caring government.
The ongoing programme of rolling out Information and Communications Technology (ICT) infrastructure across the province will also improve access to government services and contribute to the creation of an efficient government.
Honourable Speaker, what I have just described is a true reflection of what the ruling party in government, based on the African National Congress's (ANC's) election manifesto, continues to deliver to the people of Gauteng. It is these facts that are beyond contention, which indicate to us that a better Gauteng is in the making.
We are on track towards delivering on the promises we made to our people back in 2004. However a lot more still needs to be done.
To sustain our momentum there is an urgent need to further strengthen intergovernmental planning, co-ordination and implementation. This is the essence of the GCR.
Joint planning and implementation will ensure that we maximise the impact of our collective interventions aimed at delivering on our mandate. We must also form strategic partnerships with the private sector towards the achievement of our collective objectives. We must also pay attention to strengthening the capacity and organisation of the state.
Medium Term Budget Policy Statement
When we presented the 2006/07 Medium Term Expenditure Framework (MTEF) Budget, we tabled a deficit budget with expenditure exceeding revenue of R783,8 million in the 2006/07 financial year. After the adjusted budget the deficit has decreased to R610,5 million.
In the 2007/08 financial year, the deficit will be reduced further to R32,2 million and will be financed from reserves in the Provincial Revenue Fund. We wish to reiterate that our fiscal position remains stable and continues to be governed by sound principles of fiscal management.
Expenditure for the 2006/07 financial year is adjusted from R34,4 billion to R35,2 billion, increasing to R36,0 billion and to R38,5 billion in the two outer years of the MTEF. It is anticipated that from the current financial year expenditure will increase by R4 billion over the MTEF.
Total expenditure includes more than R17 billion allocated for special projects over the MTEF. These projects, which include Gautrain and the implementation of the provincial Growth and Development Strategy, are aimed at stimulating the growth of the provincial economy in order to ensure that we reach our target of eight percent growth by 2014.
Capital expenditure over the MTEF will rise to more than R35 billion. Collectively with local government we have committed ourselves to investing more than R50 billion over the next five years for infrastructure development across Gauteng.
We believe this massive investment in infrastructure will further stimulate economic growth, reduce unemployment, create new nodes of economic activity and contribute to our overall objective of changing the lives of our people for the better.
While we pay attention to funding infrastructure investment we will not lose sight of the equally important need to adequately fund social services. We wish to reiterate that social services such as health, education, community safety and social development will remain adequately funded over the MTEF.
This we will do in order to enhance social cohesion and to respond to the realisation that sustainable and vibrant communities require jobs but also they require safe neighbourhoods, quality schools and clinics as well as recreational facilities.
Easing the burden on the fiscus
Comrade Speaker, the solid performance of the economy and the sound management of public finances have provided us with the capacity and resources to increase service delivery.
Sound economic policy choices made in the early 1990s are making it possible for additional allocations to be made available for our key priorities.
However there are challenges that continue to put a strain on the fiscus. In-migration into Gauteng has resulted in a huge increase in population. According to the mid-year estimates, there are currently 9,4 million people living in Gauteng. This puts serious pressure on available resources. Changes in provincial boundaries that have seen areas such as Winterveldt, Ekangala and Mabopane being incorporated into Gauteng also present new challenges for the fiscus.
To address existing and new pressures on the fiscus, there is a need to constantly look at ways of optimising provincial revenue and easing the burden on the fiscus. In this regard, a feasibility study which proposes a provincial tax has been completed and will be presented to the Executive Council for deliberations shortly.
Other mechanisms of optimising provincial revenue which are currently being explored include the tolling of existing and future freeways. This will allow us to raise private sector funding for the maintenance and construction of high order roads. Funds from the fiscus will then be channelled towards secondary and primary roads, particularly in our townships. Blue IQ Holdings is in the process of being restructured to allow it to raise funding against its balance sheet. Equally, the Gauteng Enterprise Propeller will be corporatised and restructured to allow it to use seed funding from the fiscus to gear-in private sector funding to assist SMMEs and BBBEE companies.
A process to set up a Private Equity Fund jointly with the Metro municipalities is also underway. The Gauteng Partnership Fund is currently attracting private sector funding into the social housing market. These initiatives will be strengthened into the future.
Private sector funding, including the use of Public, Private Partnerships (PPP) for infrastructure investment will be strengthened into the future. A process led by Blue IQ for the roll out of ICT infrastructure in partnership with private sector, is also under investigation.
Comrade Speaker, we are undertaking all these initiatives in order to ease the burden on the fiscus so that we can channel more funding to our other priorities. Over the MTEF we will accelerate the implementation of our programmes.
Our focus will be on ensuring that we achieve maximum impact in addressing the challenges facing the poor and marginalised in our province. Over the next three years we will pay attention to the following:
* implementation of the Global City Region Perspective
* implementation of the Growth and Development strategies
* the Integrated 2010 Strategy * implementation of the 20 priority townships initiative
* integrated infrastructure strategy
* the Gauteng Safety Strategy
* implementation of the Social Development Strategy
* implementation of the Human Resource Development Strategy
* strengthening the capacity and organisation of the state
* integrated Youth and Women development strategies.
We wish to reiterate that these strategies are now in place. The challenge going forward is to accelerate their implementation. The Gauteng Treasury will await business plans for these Strategies so that they can be resourced.
Provincial adjustment appropriation bill of 2006
Honourable members, having outlined our priorities over the MTEF, I will now present the Provincial Adjustment Appropriation Bill of 2006. This Bill will revise the Appropriation Act of 2006 that was approved by the House in February this year.
The Appropriation Act of 2006 approved total expenditure amounting to R34,4 billion and estimated revenue of R33,8 billion. The adjusted budget we are tabling today provides for an upward revision of revenue to R33,9 billion. Expenditure is also revised upwards from R34,4 billion to R35,2 billion.
The increase in expenditure takes into account additional conditional grants from national government amounting to R110,7 million, rollovers of R236,6 million, unforeseeable and unavoidable expenditure allocations of R143,5 million and other adjustments of R332,4 million. I will now move to allocations for individual departments.
Department of Health
The Department of Health receives an additional R255 million raising its allocation from R10,4 billion to R10,6 billion in the 2006/07 financial year. The additional resources will be used for hospital revitalisation and forensic pathology services. An additional amount of R17,5 million has been allocated for the comprehensive HIV and AIDS programme.
Furthermore, we are allocating an amount of R21 million to this department for the replacement of old computers in hospitals. An additional amount of R11 million is set aside for the transformation of and the Public, Private Partnership for the Chris Hani Baragwanath Hospital.
An amount of R2 million is made available to accommodate higher salaries and related expenditure being paid to provincial staff. An additional R20 million is set aside for the prevention and treatment of extreme drug resistant (XDR) Tuberculosis.
We are also allocating an additional amount of R28 million to the department of Health to cover the shortfalls in the budgets of Dr Charles Hurwitz, Tsepong and East Rand hospitals which have arisen due to provincialisation.
An amount of R106,8 million will be suspended from the Department of Health to various departments for the HIV and AIDS project, which will be co-ordinated by the Department of Health.
Comrade Speaker, we remain committed to the development of healthy and sustainable communities in our province.
Department of Education
The Budget for the Department of Education increases from R12,2 billion to R12,4 billion. We have approved an additional amount of R129,4 million to fund incentives for educators.
The department will suspend R7,2 million to the Gauteng Shared Services Centre for the employee assistance programme. It is estimated that about 43 000 employees of the department benefit from this service.
We have made these allocations in order to boost efforts aimed at promoting skills development as a key intervention to drive economic growth and job creation.
Department of Social Development
The Department of Social Development receives an additional allocation of R52,8 million raising its budget from R981 million to R1 billion. We have approved a roll over of R4,7 million for this department to fund commitments which existed at the end of the financial year for the ongoing integrated social services programme.
An amount of R21,6 million is suspended from this department's capital budget to the Department of Public Transport, Roads and Works for the maintenance, upgrading and rehabilitation of buildings which include upgrading facilities at Walter Sisulu and Tutela Places of Safety and the planning for new prototype secure facilities.
Comrade Speaker, our commitment to ensuring social cohesion remains unquestionable.
Department of Housing
The total Budget for this department increases from R2,0 billion to R2,1 billion. An amount of R81,8 million was approved for ongoing projects in Alexandra as part of the Alexandra Renewal Project. Additional rollovers of over R2,6 million were also approved for this department.
Department of Local Government
An additional allocation of R45,8 million has been set aside for the Department of Local Government increasing its total budget from R160,3 million to R206,1 million. The bulk of this funding will be used to support municipalities.
Department of Public Transport, Roads and Works
The total budget for this department increases from R6,22 billion to R6,25 billion. Included in the allocation for this department is an amount of R163 million for improving provincial infrastructure.
Office of the Premier
An amount of R2,5 million has been allocated to the Government Communication and Information Services programme within the Office of the Premier. These funds will be used for the publication of the Midterm Review Report which reflects progress and challenges with regard to the implementation of our five year strategic priorities. The total Budget for the Office of the Premier is adjusted to R117,1 million.
The Provincial Legislature
The total budget for the provincial Legislature increases from R129 million to R146,2 million. Rollovers to the amount of R959 000 were approved for the purchase of office furniture and equipment as well as the finalisation of the Legislature's information management system project.
An additional amount of R11,1 million was approved for the Legislature to fund pressures on overseas travel expenses and visits associated with activities of the CommonWealth Parliamentary Association.
An additional R4,6 million has been approved to limit funding pressures on the 2006/07 budget of the Legislature.
The Department of Agriculture, Conservation and Environment
This department receives and additional allocation of R335 000 from national transfers to augment the Land Care Programme Grant. The total budget for this department increases from R241,8 million to R243,2 million. An amount of R3 million is suspended from this department to the Department of Public Transport, Roads and Works for construction works at the Suikerbosrand Nature Reserve and the maintenance of natural reserves.
A further R850 000 is suspended to the Department of Education for the Bontle ke Botho prize money.
The Department of Community Safety
The total budget for the Department of Community Safety increases from R220,1 million to R222,3 million. An amount of R31 million has been allocated to this Department for Road Safety projects.
The Department of Sports, Arts, Culture and Recreation
The total budget for this department increases from R221,2 million to R263,2 million. A roll over amount of R17 million has been approved for this department. This includes a capital amount of R14 million approved for upgrading the Rand Stadium.
An additional amount of R21 million was made available to this department to host soccer's major international exhibition, Soccerex. The hosting of this event will contribute towards the growth of the provincial economy and will enhance Gauteng's position as a Home of Champions and a home of Competitive Sport.
The Gauteng Shared Services Centre
The total budget for this Department increases from R751,3 million to R776,8 million. Included in the increased allocation for this department is an amount of R9,7 million allocated for the Vodacom Call Centre training project.
The Gauteng Treasury
The total budget for the Provincial Treasury declines from R70,4 million to R61,1 million. The decline is as a result of the fact that Treasury has suspended R5,2 million to various departments for strengthening the capacity of the Offices of Chief Financial Officers.
Treasury also surrendered an amount of R4 million to the Department of Health for the appointment of a transaction adviser to speed up the implementation of the Chris Hani Baragwanath PPP project.
The Department of Economic Development
The total budget for the Department of Economic Development increases from R572 million to R665 million. The additional allocation will cover among others a R10,5 million allocation to the Gauteng Gambling Board, which will be refunded to the North West Province. This follows the completion of the demarcation process that has seen Morula Sun now becoming part of Gauteng. Also included in the allocation for this department is an amount of R68 million for the Automotive Supplier Park and R10 million for the Blue Umbrella project.
Organisational and personnel implications
An amount of R70,5 million has been allocated to various departments to fund the Government Employees Medical Scheme. Treasury will monitor the use of these funds to ensure that they are not diverted into other areas.
Comrade Speaker, we have allocated the additional resources at our disposal in a manner that will ensure that we deliver on the promise we made to our people in 2004.
Our immediate task is to ensure that these funds are spent and that we accelerate the implementation of our programmes. We must continue to be intolerant to both over and under-expenditure.
Furthermore, we must continue to strengthen our capacity to deliver on our programmes.
I wish to take this opportunity to thank the Premier and my colleagues in the Executive Council for their political support and insights. A word of gratitude also goes to Heads of Department and administrative staff from my and other departments, for their technical support and advice in developing the Adjustment Bill and the Medium Term Budget Policy Statement.
I now table the following documents for consideration by this House:
* the Provincial Adjustment Appropriation Bill of 2006
* the Explanatory Memorandum to the Bill
* the Medium Term Budget Policy Statement of 2006
* a copy of my speech.
Ke a leboga.
Issued by: Department of Finance and Economic Affairs, Gauteng Provincial Government
21 November 2006
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