1. 2003 Intergovernmental Fiscal Review Provincial Budget Trends
15 April 2003

2. Key trends 3 spheres of govt, all with different functions
Biggest budgets at provincial level
2003 budgeted non-interest revenue R280bn in 2003/04
national -R108,9 bn or 38,9 %
provinces-R158,9 bn or 56,8 %
local government-R12 bn or 4,3%
provincial share grows to 57,6 per cent in 2005/06
Provinces draw up their own budgets after national budget
they allocate national transfers (96,9%)plus own revenue(3,1)
national transfers grows to 97,1% in 2005/06

3. Key trends
Provinces are budgeting for financed deficits of R1,1 bn in 2003/04 and 2005/06
once-off in nature
further bolster infrastructure
Capital spending growing strong
great improvement in delivery mechanisms
R13,7bn in 2002/03
R60bn over the next three years
Education and health on average R3 bn per year

4. Provincial spending

5. Provincial spending

6. Provincial spending Provinces table expansionary budgets
Real growth of 7,5 % in 2003/04 and 5,3% over the MTEF
consolidate and expand current programmes
improve outreach of social programmes, especially the ones targeting the poor
addressing poverty and vulnerability

7. Social Spending Education Health
substantial growth in non-personnel non-capital
provision for LSM and other inputs
infrastructure
Health
recruit and retain health professional with scarce skills
drugs and medicine
bolster the system against the impact of HIV/Aids
Infrastructure

8. Social Spending Social development
one of the greatest achievements of government
beneficiaries grew from 2,5 mil beneficiaries in 1997 to 5,6 mil in 2003
expect to add a further1 mil beneficiaries over next 3 years
growth in budgets
protect real value of grants
increase its coverage (extension of CSG to children until 14)
R1,1bn in 2003/04;R3,4bn in 2004/05; and R6,4bn in 2005/06

9. Non-Social Services Spending
Housing, provincial roads, agriculture, economic affairs, tourism and other admin functions)
R40 billion on capital over next three years
positive economic spinoffs for provinces
improve the quality of provincial infrastructure
efficient delivery of other services
contribute to economic growth and job creation

10. Provincial Expenditure

11. Provincial Expenditure

12. Provincial Revenue

13. Provincial Revenue

14. Provincial Revenue

15. Provincial personnel:Trends

16. Provincial personnel:Trends

17. Personnel overview
Personnel management is critical to improving service delivery at all levels of Government
At provincial level…
Good progress in establishing a framework for personnel management
Personnel costs are being managed

18. Provincial personnel trends
Real decline in personnel costs from 1996/97 to 2001/02
Decline in personnel numbers over the same period
Moderate increase in unit labour costs over the period
Moderate real growth in personnel spending going forward aimed at:
Increasing employment in health
Provision for pay progression and performance-related pay

19. Provincial personnel policy issues
Poor provinces still spending a lot on surplus staff
Resulting in lower capex and poor staffing in education and health
Need to increase employment in health and welfare services
Especially medical professionals, social workers
Revised pay system required
Need appropriate performance-related pay systems
Need to decentralise personnel management lower down the chain
Giving hospital managers real powers
Increasing powers of school governing boards

20. 2003 Intergovernmental Review Provincial Budget Trends
NCOP
8 April 2003