The dichotomy between South Africa’s healthier-than-expected government finances and its less-than-healthy growth outlook was the undoubted macro theme of Budget 2012.

There was no sign of the much-feared ‘fiscal slippage’, with Finance Minister Pravin Gordhan revising the country’s Budget deficit figure for 2011/12 to 4.8% of gross domestic product (GDP), from the 5.5% announced in October. The outlook was also better than expected at 4.6% for 2012/13, 4% in 2013/14 and 3% for 2014/15.

The growth forecast, by contrast, was dismal. Real GDP growth was now expected to be just 2.7% in 2012, well short of the already uninspiring 3.4% October forecast. Projections of 3.6% for 2013 and 4.2% for 2014 were also worse than the 4.1% and 4.3% respectively, estimated last year.

That balance-sheet-versus-outlook contradiction provided the backdrop for the two other major subthemes of this year’s Budget: shifting the expenditure focus decisively from consumption to investment, and actually delivering on the R845-billion infrastructure pipeline.

Both themes are related, but Gordhan did particularly well in articulating what government plans to do on the second.

First, he acknowledged the glaring weakness of delivery departments and State-owned companies to deliver projects on time and on budget.

It was not a mere mea culpa moment, however. The confession was followed up with some quite practical remedies: use your capital budgets, or lose them; improve prioritisation, planning and coordination through the Presidential Infrastructure Coordinating Commission; build planning and project management capacity through the Cities Support Programme and the Municipal Infrastructure Support Agency; and overhaul the management of the procurement system to reduce waste, improve efficiency and deal with corruption.

The announcements on procurement reform were particularly heartening. The debate was framed in the Budget Review by the admission that despite consistent growth in public spending (the R1.1-trillion Budget of 2012 is, in real terms, double the expenditure levels of ten years ago), there had not been a commensurate improvement in service delivery outcomes.

The document then went on to outline the steps being taken to strengthen efficiency in public spending, eliminate wastage, improve the alignment between allocations and policy priorities and to root out corruption.

Public-sector financial management failures would receive attention and there might be changes to regulations to ensure greater transparency and public disclosure and more rigorous tender procedures.

The National Treasury would appoint a chief procurement officer, who will have overall responsibility for monitoring procurement across government. The competences and capabilities required by those performing procurement functions would also be reviewed and a national price reference system established to detect deviations from “accept-able prices”.

The tax clearance system would be strengthened to ensure that those who had defrauded the State could no longer do business with government and steps would be taken to improve the ability of departments to set the specifications for tenders.

Ideally, these sound management principles and the proposed changes will finally begin to help South Africa deal with the chronic problem of capital-budget underspending and misspending. But, as with all government initiatives, much will hinge on whether the burgeoning public service plays its role in ensuring the good policies and systems are not circumvented. We live in hope.