The Director-General of Finance will issue a press release today containing preliminary estimates of the outcome of the 1998/99 Budget.
Revenue has again exceeded our projections. The preliminary estimate is that total revenue for the year was R183,3 billion - some R3,4 billion more than the revised estimate published in the 1999 Budget Review.
The SA Revenue Service collected R22,1 billion in March 1999, which is 22,5 per cent more than receipts in March 1998. This is further evidence of the success of the revenue authorities in strengthening our tax system.
The robust revenue performance of the last few months also confirms our confidence in the underlying recovery in the broader economy this year.
Final figures for national budget expenditure are not available at this stage. However, total requisitions by national departments - including transfers to provinces and other
statutory spending commitments - amounted to R205,8 billion during the course of 1998/99. R1,16 billion was recovered from government pension funds. Although late requisitions and surrenders of unspent funds have still to be taken into account, this provides a preliminary estimate of total expenditure of R204,7 billion.
This is R393 million more than our revised estimate of expenditure. Departmental under-spending appears to have been lower than our estimate of about R2,5 billion, reflecting further improvements in the alignment of budgets and actual spending.
Based on the preliminary revenue and expenditure estimates, the budget deficit in 1998/99 amounted to R21,3 billion, or 3,3 per cent of estimated GDP.
At the time of the 1999 Budget, we anticipated that the 1998/99 deficit would be about 3,7 per cent of GDP. The more favourable outcome means that the exchequer ended the year with a positive cash balance available for financing the 1999/00 deficit. We are accordingly able to revise the projected net government bond financing requirement for 1999/00 down from R14,8 billion to R12,0 billion.
This will contribute further to lower interest rates and a stronger recovery of the South African economy this year.
Department of Finance
16 April 1999