Education, health and security services saved from budget slash as Godongwana announces additional funding for those sectors

Finance Minister Enoch Godongwana, who tabled the 2023 Medium-Term Budget Policy Statement (MTBPS) on Wednesday, has announced additional funding for "personnel-heavy" sectors such as health, education, and police services.

Godongwana announced additional funding of R24 billion this year and R74 billion over the medium term to be used to fund the 7.5% public sector wage increase in the education and health sectors and the associated carry-through costs in these sectors.

This year, provincial departments of health and education will get an extra R17.6bn for that.

National Treasury recently advised national departments and provincial treasuries on specific measures required to save costs and “prevent crippling resource constraints” in the latter part of the 2023/24 financial year.

All state institutions were instructed to slash budgets by up to 15% and freeze all vacancies and infrastructure rollout programmes.

While budget cuts were expected in these critical sectors, Godongwana said they would not compromise on the work done by security agencies, health, basic and higher education, and social development in the delivery of services.

In addition, Godongwana said the allocations in the current year for unforeseeable and unavoidable events, government had set aside R1.6 billion for disaster relief, including to repair flood damage in various provinces.

To cater for the growing pressures imposed by climate change on infrastructure, especially at the local level, government created a resource pool to specifically respond to future disasters.

In this regard, R372 million has been added to the municipal disaster response grant, while R1.2 billion has been added to the municipal disaster recovery grant, to cover the repair and rehabilitation of infrastructure damaged by flooding in February and March 2023.

"Mitigating the environmental risks posed by climate change must go hand-in-hand with addressing the financial and economic risks posed by climate change.

“The National Treasury is making progress towards developing a disaster risk financing strategy, which will, among others, enhance existing risk financing instruments,” he said.

kailene.pillay@inl.co.za

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