1
BUDGET SPEECH
BY
MEC FOR FINANCE AND ECONOMIC DEVELOPMENT
MR D.E. AFRICA
Honourable Speaker/Deputy Speaker,
Honourable Premier,
Honourable MEC’s and MPL’s,
Mayors and Speakers of Local Government,
Chairperson of SALGA,
Traditional Leaders,
Heads of Departments,
CEO’s of our Parastatals,
Business Leaders,
Representatives from the Financial Services Sector
Baagi ba Bokone-Bophirima,
Leaders of Sanco and Sangoco and other Civil Society
formations,
Church Leaders,
Distinguished Guests,
Comrades and Friends.
Madam Speaker,
At the beginning of Charles Dickens classic novel, Hard
Times, the main protagonist, the principal and a man of
wisdom, Thomas Grandgrind implores a new teacher:
2
“Now, what I want Sir is, Facts. Teach these boys and girls
nothing but Facts. Facts alone are wanted in life.
Plant nothing else, and root out everything else. You can
only form the minds of reasoning animals upon Facts:
nothing else will ever be of any service to them.
This is the foundation upon which I bring up my own
children, and this is the principle on which I bring up these
children. Stick to Facts, Sir!”
However, confronted with the wisdom of the rebellious
daughter, Louisa and the reality of changed conditions, Mr.
Grandgrind concedes:
“Some persons hold…that there is wisdom of the Head, and
that there is wisdom of the Heart. I have not supposed so,
but, as I have said, I mistrust myself now. I have supposed
the head to be all-sufficient. It may not be all-sufficient; how
can I venture this morning to say it is! If that other kind of
wisdom should be what I have neglected, and should be the
instinct that is wanted, Louisa-”.
3
The First Decade of our democracy served as a platform for
implementing appropriate policies and strategies that
enhanced the ability of government to realise the vision that:
“All shall share in the Country’s Wealth”.
This was subsequently translated into a Constitutional vision
“to improve the quality of life of all citizens and free the
potential of each person”.
Needless to say, the experience of governing over the
preceding years and the accompanying challenges accruing
from underdevelopment and neglect, unemployment and
underemployment, social-political and economic
marginalisation, necessitated a reconsideration of the
institutional configuration and economic trajectory of the
country.
Like Dickens’ Mr. Grandgrind, as government we could not
but acknowledge the material conditions confronted by our
country and people.
4
Accordingly, we vehemently rejected invitations to partake in
choruses that put the individual above society, hence our
people-centered approach to development, articulated in the
Freedom Charter and the RDP.
Notwithstanding the serious challenges we were faced with,
the majority of which many observers thought were
insurmountable, we registered a higher return than
expected.
First and foremost, we attained freedom and political
stability, which in turn created a climate conducive for
investment in an array of economic activities in the country.
This freedom and stability has indeed set a foundation for
economic development in the period ahead and will afford us
an apportunity to consolidate the gains we made in the past
ten years.
The consolidation I am referring to, is the one which, in the
next decade, should result in increased opportunities for
jobs, increased foreign direct investment, improved safety of
the vulnerable groups of our society, improved public
5
services, improved economic and social infrastructure and
better management of public resources, so that our people
can reap the benefit of a true democracy.
Madam Speaker, these developments will ensure that we
expand the benefits of freedom equitably across all sectors
of our society, a task, which can be made even more easy
when a positive partnership exists between government,
business, civil society and communities.
Macro Economic context
Defying the general slack in the growth of the global
economy due to the phenomenal increases in oil prices and
rising interest rates, the South African economy has had a
sustained average growth rate of 3,2 percent over the past
four years.
Continued growth of between 4 and 4,5 percent per annum
over the next three years is expected. Such growth
prospects are supported by low and stable inflation and
interest rates.
6
An average CPIX inflation rate of between 3 to 6 percent
target range is expected over the period and interest rates
are at a 24-year low.
This, in turn has seen growth in fixed capital formation of an
estimated 7,5 percent in 2004. Along with creating an
investment platform for future growth and productivity
advances, this strong monetary position has also aided the
domestic economy in the form of sound growth in value
added in the construction sector and strong growth in the
residential property market.
For the year ahead, economists also see strong growth in
the primary sector with high commodity prices and volumes
of exports reflecting the weaker dollar and high demand from
Asia.
In the manufacturing sector, the motor and chemical
industries are also doing well. In the services sector,
retailing, communication and financial services are expected
to benefit from the higher than average growth.
7
These developments are the result of the excellent
management of the macro-economic environment by our
national government and the fiscal prudence spearheaded
by our Minister of Finance.
The challenge recently has been the increasing oil prices,
which have rocketed above US$40 per barrel for the better
part of 2004, and that price level is still persisting.
Whilst the strong Rand has adversely affected the
competitiveness of our exports and therefore lowered
profitability in the mining and manufacturing industries, on
the other hand it did contribute towards lower domestic rates
of inflation against the sharp increases in the international
price of crude oil in 2004.
Notwithstanding the pressures exerted by a strong Rand on
exports, our country is currently benefiting from the most
significant commodity price boom since the 1970s.
Commodity prices including prices of minerals are likely to
increase until at least 2008.
8
Ka jalo, ga gona pelaelo epe gore Afrika Borwa e itumelela
maungo a dipholesi tsa yona tse di tsepameng tsa ikonomi
mme go sa ntse go bonelwa pele dipoelo tse dingwe mo
bogautshwaneng.
Maungo a tiragatso ya dipholesi tseno ke phokotsego ya
molato wa puso, infoleišene e e kwa tlase, jaaka ke setse ke
kaile, le kelo e e kwa tlase ya morokotso e e susumetsang
tlhokego ya kerediti (credit) mme gape e oketsa tiriso jaaka
re sa tswa go lemoga fa gautshwane.
Seemo sa ga jaana sa ikonomi se siametse dipeeletso le
kgolo mme se tsositse boikanyo jwa babeeletsi. Ntlha e e
bonalang ya ikonomi ya rona ke kgolo ya dikago, e leng
sesusumetsi se segolo sa kgolo ya ikonomi le ntšhwafatso
ya metsesetoropo. Toropo ya Mafikeng le yona e itemogela
seno, fela Rustenburg e itlhomile kwa pele mo ntlheng eno.
Economic profile of the North West
According to the latest figures released in November 2004
by Statistics South Africa the economy of the North West
grew by 3,8 percent in 2003.
9
This higher than the national average growth is mainly
attributable to a 9 percent growth in the mining and quarrying
industry, 4,9 percent in trade and tourism and 4,3 percent in
the financial services sector over the same period. We
expect a growth of 4 to 4,5 percent for the North West, going
forward with 6 percent growth possible.
Madam Speaker, in spite of these great strides, external
factors continue to pose serious challenges to our efforts at
developing the economy of the province. These include:
• The strength of the Rand, which is putting pressure on the
viability of gold mines. Gold production has been falling
steadily – output has fallen by a third since 1995 and the
trend remains downward.
A recent article in The Economist highlighted that the Rand
costs of mining gold in South Africa is making it difficult for
mines to viably compete in the world market.
Already this has begun to pose serious challenges for gold
dependent regions and municipalities such as the KOSH
area, where the continued economic survival of these
10
localities must be sought within other sectors of the economy
through the employment of creative thinking around some of
the inherent possibilities that currently prevail in these areas.
• Drought conditions and low agricultural commodity prices,
which are adversely affecting farmers, particularly
emerging farmers. Currently, agriculture in the North West
is suffering from a regional drought and poor world prices
as well as a strong Rand.
Though agriculture is a small sector of the national economy
(contributing less than 4% to GDP) disturbances tend to
have significant effects on the conditions of the local
economies and the communities that coexist around these
areas.
• It is important to note though that the province is gradually
turning the tide against dependence on mining and is
diversifying towards other sectors of the economy other
than agriculture and mining.
11
Mining is still however, the most important sector in the
economy of the province with production of more than 35%
of South Africa’s output of precious metals.
Consolidating a foundation for sustainable development
Over the last ten years, we have succeeded to create a solid
foundation for sustainable development by managing our
resources and finances prudently and continuously investing
in good financial management.
This was fundamental to ensure that our resources will
continuously be deployed to address the developmental
challenges facing our country and simultaneously
addressing the socio-economic challenges facing our
province.
The result of managing our resources effectively and
efficiently in the last decade is now making more resources
available to us to intensify our fight against poverty, and give
momentum to our development trajectory. The budget we
are presenting today will attest to this fact.
12
To quote Amartya Sen: “the ends and means of
development require understanding of the development
process, it is simply not adequate to take as our basic
objective just the maximisation of income or wealth.
Development has to be more concerned with enhancing the
lives we lead and the freedoms we enjoy”.
This is what the Freedom Charter is about, fully realising its
vision means making our people fuller social persons,
enjoying their humanity with pride.
Through the budget - we speak of freedom
The budget is a critical tool for implementing government
policy priorities and realising its broad development
objectives, and addressing the real needs of its people, and
giving meaning to the freedom we attained a decade ago.
In this decade, we will use our budget to effectively and
realistically invest in growth and development. We will lead
others, through the budget to join us in this regard, thus
realising the injunction of the Freedom Charter – that sideby-
side we will give meaning to these freedoms.
13
Realising the objective of the Provincial Growth and
Development Strategy.
Before sharing with the house our plan on the Provincial
Growth and Development Strategy, I wish to take this
opportunity to announce that one of our principal advisors on
the Provincial Growth and Development Strategy Professor
Guy Mhone passed away last week and we are indeed
saddened by his passing.
Professor Mhone was instrumental in providing the
framework for our Growth and Development Summit. Our
condolences go to his family at this time of grief.
For the next ten years our growth and development path will
be guided by the Provincial Growth and Development
Strategy, which provides a framework within which our
economic development efforts will be undertaken.
14
Our major focus, in pursuit of the objectives of our Provincial
Growth and Development Strategy will be economic growth,
infrastructure, skills development, agriculture and urban
renewal, so that we could create the almost 40 000 jobs
needed annually to halve unemployment by 2014 or earlier.
The development of the Provincial Growth and Development
Strategy was guided by the National Vision 2014. Through
the PGDS we committed ourselves to the following
objectives, among others:
• Halving the unemployment rate, which currently stands at
48%.
• Pursue targeted provincial growth of 6,6% per annum
(from the current growth rate of 3,8%)
• Provide skills for development and economic growth.
• Vigorously promote investments.
Responding to the implementation of the strategy with a view
to achieving the objectives of Vision 2014 we plan to do the
following:
15
Promoting SMME’s as stimulators of growth in the
second economy.
We will continue to focus on the development of sustainable
co-operatives and SMME’s, which in turn can contribute
towards job creation, particularly in the rural communities
where unemployment is rife.
We will also have a special focus on the creation of the
capacity of SMME’s and entrepreneurship, which are critical
to ensure that their profile is properly enhanced in the
economy and particularly the growth of the second economy.
In an effort to promote SMME development Invest North
West is facilitating the signing of a Memorandum of
Understanding between the State of Delhi in India and the
North West Province on specific sectors, namely:
• Beef beneficiation
• Agro-processing
• Diamond cutting (jewellery)
• Human resource development.
16
I believe that the signing of such a Memorandum of
Understanding will benefit our province, as INDIA is known
for its strong support for SMME’s.
Improving critical infrastructure for economic growth
The road network is critical for efficient economic services in
the province and with a strong road network we will be in a
position to compete for investment opportunities and attract
potential investors to the North West. Our budget must
seriously address our weaknesses in this regard.
Fighting rural poverty and rural development.
Rural development and agricultural growth and support, are
crucial if we are to address rural poverty and bridge the
dichotomy between urban and rural communities.
Support for land reform and emerging farmers, working
together with established farmers will be our main focus so
that our efforts at poverty eradication are strengthened.
17
MIDZ and SDI-critical for growth.
Our main focus in the MTEF will be on the Mafikeng
Industrial Development Zone and Spatial Development
Initiatives. We will be commencing with the construction of
basic infrastructure around the airport so that the planned
investments from the private sector can take place.
The Minister of the Department of Trade and Industry
supports our initiatives on the Industrial Development Zone
and a joint working team from DTI and the Department of
Finance and Economic Development has been formed to
look at the proposed implementation plan.
Kago ya bokgoni gore go nne le kgolo e e nnelang ruri
Go godisa bokgoni jwa badiri go botlhokwa thata mo
tlhabololong ya ikonomi. Bokgoni jwa tiro mo maphateng
otlhe a ikonomi le botsamaisi bo botlhokwa tota mo
tsamaisong ya puso.
18
Gore re atlege mo maitekong a rona a go aga le go godisa
ikonomi ya rona, re tla tlhoka go tiisa maiteko a rona a go
netefatsa gore go na le bokgoni jo bo maleba mo
Porofenseng. Seno se tlile go tlotiwa thata mo
tekanyetsokabong eno.
Urban management and change
In most parts of the province, many continue to be subjected
to deplorable conditions, with many even today still using the
bucket system.
The urban environment needs to be altered so that our
people can live in dignity with proper sanitary arrangements,
and an urban envirornment, which restores their dignity and
pride. Our resources must therefore seriously tackle this
challenge.
19
Restoring the aesthetics of our surroundings and
infrastructure.
In the context of the Provincial Growth and Development
Strategy, we have taken a conscious decision to accelerate
the maintenance of our infrastructure so that we do not
reverse the gains we made in providing these assets. All
government buildings will be given a face-lift, creating jobs in
the process.
Building Human Settlement to improve the quality of life
of communities.
Delivery of basic needs remains one of our key
responsibilities and indeed we will continue to ensure that
we deliver these needs.
Municipalities will be given greater attention so that they can
meet their constitutional obligation and become centers of
hope and solace for our communities, always ready to
communicate and serve them through the ward commitees
rather than become city halls of despair.
20
Building better environments for the social development
of communities.
We need to strike a balance of investing in economic and
social infrastructure.
Taking into consideration the inherited backlogs in social
infrastructure it is important that we invest aggressively in
this area to ensure that we have classrooms, clinics,
recreational facilities which can contribute to enhancing the
lives of our people and ensuring that they enjoy their
freedom and become fuller social beings. This budget must
address this challenge.
Creating conditions conducive to our civil servants.
Due to the shortage of office space both at the head quarters
and the districts we have taken a decision to build offices to
accommodate our officials who are squatting in areas where
it is difficult to deliver services to the public, in an effective
and efficient manner.
21
In the construction of these offices we will ensure that broad
based black economic empowerment is promoted
effectively.
Poverty alleviation through social security
The Minister of Finance, Hon. Trevor Manuel, in his budget
speech announced that with effect from 1st April 2005 the
maximum old age, disability and care dependency grants will
rise by R40 to R780 a month, foster care grants increase by
R30 to R560 and the child support grant goes up by R10 to
R180 a month.
Madam Speaker, the social security net is one of our key
intervention strategies to ensure that we curb the increase of
hunger and poverty. In the coming financial year we will
provide the social grant to 965 325 beneficiaries.
However, Madam Speaker, we must caution that this
development is not sustainable, we must also ensure that we
reduce dependency by investing more in economic growth
and development, so that more people should be weaned
from grants and be given sustainable jobs and security.
22
Procurement reform
With effect from 1 April 2005 the procurement of goods and
services will be the responsibility of government
departments. The Tender Board will be phased out with
effect from the 31st March 2005.
The bill, which transfers the procurement authority to
departments, will be tabled in the Legislature shortly and will
be finalised before the 31st of March 2005.
Madam Speaker, our challenge now is to set up a
committee, which will adjudicate transversal tenders so that
such tenders can be dealt with speedily to serve the
departments. This development, we believe, will speed up
delivery and remove tensions between the Tender Board
and Departments.
Modernizing resource management at local level
The management of resources prudently at local level is
crucial to services delivery.
23
The Provincial Treasury is currently building internal capacity
in order to fulfill the responsibilities placed upon treasuries
by the Municipal Finance Management Act, to ensure that
municipalities develop the necessary capacity to manage
their financial and other related resources prudently and
deploy such for more and better service delivery to local
communities.
We will work together with municipalities to ensure that they
have the necessary capacity to manage their resources and
improve on service delivery.
Raising Revenue through Gambling
Gambling has a significant role in the economy of our
province. Spin offs from the regulation of this industry
contribute significantly to various socio-economic
imperatives on the provincial agenda such as job creation,
investments, creation of business opportunities, revenue and
tourism promotion.
24
The five casinos currently licensed in the province account
for approximately R2 billion in investments within the
province. As an important part of our provincial economy, the
gambling industry within the province is also undergoing
transformation.
As part of broad based black economic empowerment, the
North West Gambling Board has imposed conditions of
license on the five casinos in the province relating to the
following black economic empowerment imperatives:
• Employment of PDI’s in supervisory and management
positions within casinos;
• Equity shareholding for PDI’s in licensed casinos;
• Training and skills transfer;
• Procurement of goods and services from SMME’s in the
province;
• Contribution to needy projects/communities.
These measures are aimed at ensuring that the socioeconomic
benefits of the gambling industry also filter through
to PDI’s in the province through equity, skills transfer,
25
procurement of goods and services and contribution to
needy causes.
As part of the effort to advance Black Economic
Empowerment and create opportunities for SMME’s in the
gambling industry, the Gambling Board has invited and will
soon consider applications for limited payout machines
Bothata jo re lebaneng nabo ke jwa ditiro tse di seng ka fa
molaong tsa itekolesego (gambling), tse di nang le bokgoni
jo bo boitshegang jwa go nyeletsa lotseno la rona. Mo
dikgweding tse somepedi tse di fetileng, re thopile dikgwebo
tse di dirang e seng ka fa molaong di feta sekete le
kgolamararo (1 300), mme re lekanyetsa gore go sa ntse go
na le metšhini ya mefuta eno e feta dikete tse tharo (3 000) e
e sa ntseng e dira.
Gore re fedise seno, ke tla tlhagisa molaotlhomo o o
baakanyang Molao o mogolo, go netefatsa gore re thiba
diphatlha tsotlhe tse di dirisiwang ke badirisi ba ba seng mo
molaong mo Porofenseng.
26
Liquor Act
Following the passing of the National Liquor Act the province
is in the process of drafting the Provincial Liquor Act to
regulate both the licensed and the currently unlicensed
operations.
Currently there are one thousand eight hundred and fifty
licensed shebeens and our estimate is that more than
double this number are unlicensed. We will launch an
aggressive strategy to license all unlicensed shebeens and
improve their profile as significant players in the second
economy.
Our plan is to bring the Act into operation by end of March
2005. This approach will further improve our revenue
raising capacity.
Establishment of an agency to manage the social
grants.
The National Government has decided to set up an agency
whose responsibility is to manage the social security grants.
27
The agency will start operating in April 2006. As a start
however, the social security budget has been transferred to
the National Department of Social Development and will be
transferred as a conditional grant to provinces to render the
service.
Madam Speaker, twenty four percent of our equitable share
which amounts to R3,6 billion has been transferred to the
national department as a result of the creation of the new
agency.
Details of how the agency and the interim arrangement will
work will be outlined by the responsible MEC in her budget
vote presentation.
Shaping the Budget Process
Madam Speaker, before I announce our budget per
department I wish to share with you the process we followed
in preparing the budget being presented today.
28
Historically, the budget has been biased towards recurrent
expenditure hence depriving us of an opportunity to allocate
more funds for development, growth and skills.
As a measure to start releasing more funds towards
development, we took steps to transform and restructure our
budget to align it with our development objectives and
priorities more strategically.
Firstly, the budget process was guided by the Budget
Oversight Committee appointed by EXCO, to ensure that we
maximise the funding for our policy priorities.
Secondly, departments were requested to go back to the
basics by motivating each item they were requesting funding
for.
Thirdly, we quantified the fixed commitments and essential
expenditure of all departments .The balance was not
allocated and could only be allocated to departments once
satisfactory motivations were presented.
29
The fourth and the most critical is the decision to deliberately
increase development spending as a percentage of the total
budget from about 6% to 12,2%, a move which I believe will
give us the capacity to address economic infrastructure in
the context of the Provincial Growth and Development
Strategy.
The development budget was allocated to departments and
ring fenced for use, specifically for development and policy
initiative.
Beneficiary departments are required to submit business
plans of development projects by the 31st March 2005, to the
Premier’s Office for evaluation and approval.
If business plans are not submitted, the funds will not be
released for any other purpose but instead will be
reallocated to departments with capacity to spend on our
development objectives and priorities.
This approach makes sense to us because we will avoid the
problem of rolling funds over and over when our
30
communities are in dire need for services and therefore
susceptible to agitation to wreak havoc at local level.
We have also cut back on the administrative expenditure
and each department’s share of this type of expenditure has
been proportionately aligned to the size of administration
load.
The Budget Framework
Revenue
The total budgeted revenue for 2005/06 financial year
amounts to R17,459 billion.
This amount is made up as follows:
- Equitable share R11,086 billion
- Conditional grants R 5,947 billion
- Own sourced revenue R 0,426 billion
Revenue increases to R19,173 billion and R20,769 billion in
the outer years of the MTEF period.
31
Expenditure
We are providing for a balanced budget and the budgeted
expenditure therefore is limited to the available revenue.
Madam Speaker, The budget being presented today is
reflecting a shift towards growth, economic and infrastructure
development, creating conditions to realise the vision of the
Freedom Charter.
The amount allocated for purposes of improving growth,
economic development and infrastructure is R1,356 billion,
an increase of 41% over the last year allocation.
Dikgwebopotlana (SMME’s)
Puso e tlametse ka bokana dimilione tse somamabedi tlhano
(R25 million), e e tshwanetseng go lekalekanngwa ke
lephata la poraefete gore go nne le tshegetso e e lekaneng
ya dikgwebopotlana.
32
Letlole leno le tla dirisediwa katiso, tšhelete ya thuso,
tšhelete ya tekatekano ya dikgwebo, tšhelete ya katoloso ya
dikgwebo tse di ntseng di le gona, le ditshegetso tsa mefuta
e mengwe tse di ka dirang gore dikgwebopotlana di tswelele
pele. Dintlha malebana le go fitlhelela letlole di tla itsisewe
ka kgwedi ya Motsheganong 2005.
Re tla tswelela go batlisisa mekgwa e maleba ya go
tshegetsa dikgwebopotlana ka maikaelelo a go ditsweletsa
pele.
Mo pakeng eno ya MTEF, re tla beela thoko bokana ka
dimilione tse lekgolo (R100million) go maatlafatsa
dikgwebopotlana le go lemoga seabe sa tsona mo
kgodisong ya ikonomi ya rona.
Transport Infrastructure
The budget provides an amount of R274,8 million for the
construction of roads infrastructure. This allocation is 38%
more than the 2004/05 amount and increases by 16% to
R318,9 million by the end of the MTEF period.
33
Included in this amount is R14 million provided for the repair
of Mafikeng Airport runway, which the Premier, in her state
of the Province address, referred to.
Landelike en Landbouontwikkeling
Ons het ‘n bedrag van R150 miljoen in die MTUR tydperk
opsy gesit vir naskikking, asook die ondersteuning van die
landbou teen ‘n bedrag van R50 miljoen per jaar.
Die jaarlikse toedeling is 67% meer as die 2004/2005
begroting. Hierdie toedeling stel die Provinsie in staat on
landelike en landbouontwikkeling te bevorder, om
herverdeling van grond te bespoedig en om opkomende
boere te ondersteun.
Mafikeng Industrial Development Zone
Preparatory work has already begun and government has
set aside R22 million in the current financial year for basic
infrastructure around the Mafikeng Airport to support the
MIDZ.
34
In the MTEF period a total amount of R100 million will be
availed for Mafikeng Industrial Development Zone (MIDZ)
with R20 million in the first year and R40 million for each of
the two outer years of the MTEF period. We will continue to
use the main budget to give impetus to the MIDZ and other
SDI infrastructure.
This investment will leverage 30% additional funds from the
Department of Trade and Industry.
Private sector investment is expected to be in excess of
R220 million over a ten-year period starting with a R60
million minerals cluster project in the not too distant future.
Human Resource Development
The budget provides R73 million for training and research in
the coming year, an increase of 72% over the 2004/05
budget of R43 million. This amount increases to R81,7
million and R86,7 respectively in the two outer years of the
MTEF period, to ensure that we build proper skills for
governance and economic development.
35
Urban Renewal
We are providing R170 million in the MTEF for the Bucket
Replacement Programme with R30 million next year and
R70 million in each of the two outer years of the MTEF
period.
The deplorable conditions, which undermine the dignity of
our local communities, cannot be justified any further, ten
years later.
The bucket system undermines the vision of the Freedom
Charter, which states, “slums shall be demolished and new
suburbs built where all have transport, roads, lighting,
playing fields, creches and social centres”. The eradication
of the bucket system is therefore critical to give hope to our
people in pursuit of this vision of the Freedom Charter.
Maintenance
We are providing R441,6 million for the maintenance of
infrastructure, an increase of 68% over the 2004/05
36
allocation. This amount increases to R472,4 million and
R508,9 million respectively in the MTEF period.
Human Settlement
An amount of R467,9 million has been provided to the
housing fund from which houses are to be built and thus
create sustainable human settlement and realise the
injunction of the Freedom Charter- “There shall be houses
and security”.
This allocation reflects an increase of 9% and increases to
R546,8 million and R668,3 million in the MTEF period.
Social Infrastructure
We have set aside R348,5 million to cater for Health facilities
(R139 million); Education facilities (R167,4 million) and
building places of safety (R30 million). This amount is 17%
more than the 2004/5 allocation.
The budget for social infrastructure increases to R453,6
million and R494,6 million in the MTEF period.
37
Office Accommodation
An amount of R73 million has been provided in the next
financial year and further amounts of R108 million and R104,
5 million have been provided respectively in the outer two
years of the MTEF period for building of offices for the entire
provincial administration in an integrated manner.
Coming to the allocation Madam Speaker, the total budget
amounts to R17, 459 billion and includes an amount of R5,
947 billion in respect of conditional grants of which R4,616
billion is money earmarked for social grants.
It is important to note that we are funding the social services
sector to the tune of 78% of the total budget to ensure that
we deliver quality education, effective health services and
social grants to our people.
38
The budget is allocated as follows:
Office of the Premier receives R196, 648 million. Some of
the key programmes the Office is driving are the learnership
programmes, policy management and building offices for
traditional leaders at R4 million for next year and another
R17 million in the two outer years of the MTEF period.
This budget has increased by 33,9% to allow the Premier to
effectively manage and provide strategic leadership to all
Departments with the relevant internal capacity.
Office of the Legislature receives R103,255 million. The
coming financial year will see the Office completing the
extension of the Legislature building at a further cost of
R10,8 million. This budget is increased by 21,3%. The
increased resources will enable the Office to create capacity
to manage parliamentary operations to our benefit increase
its oversight and promote democracy in general.
39
Health receives R2,894 billion, an increase of 11,4% over its
2004/05 allocation. Some of the funds have been targeted
for TB services (R15 million) ambulances and patient
transport at R14,6 million and hospital reconstruction at R99
million. HIV/AIDS programme will receive R100,92 million to
implement the operational plan for comprehensive HIV/AIDS
care.
The HIV/AIDS allocation increases to R142,32 million and
R149,43 million in the outer two years of the MTEF period.
Sport, Arts and Culture receives R201,071 million. Of the
amount allocated, R12 million is earmarked for the building
of libraries. Part of these funds will need to be focused on
preparations for 2010 soccer world cup. This budget
increases by 23,7%.
Safety and Liaison receives an amount of R25,316 million,
an increase of 27,5%. This department is key in building and
maintaining good relations between the police and the
community and ensuring that a conducive environment
prevails to realise and consolidate the injunction of the
Freedom Charter – “All shall be equal before the law”.
40
Finance and Economic Development receives R316,679
million, an increase of 6,1% to allow the department to
effectively lead the implementation of the PGDS. Some of
the key programmes the department will embark upon are
increased support to SMME’s and the intensification of the
implementation of the Mafikeng Industrial Development Zone
(MIDZ).
Education receives R5,833 billion, an increase of 9,4% over
its 2004/05 allocation. Some of the funds will go towards
payment of pay progression of educators (R68,5 million),
purchase of text books is allocated R90 million and the
amount increases to R100 million and R120 million in the
outer two years of the MTEF period.
Further Education and Training (FET) receives R20 million
while ABET is allocated additional R10 million over and
above its current financial year allocation.
Developmental Local Government and Housing receives
R613,560 million an increase of 5,2%. The bulk of this
money goes towards the housing fund to ensure that we built
sustainable human settlements, referred to earlier.
41
This will increase our capacity to eradicate slums and
eliminate informal settlements in the next decade.
Transport and Roads receives R1,343 billion. Key
programmes are the construction and maintenance of roads,
scholar transport and commuter subsidies have also been
provided in this vote. The allocation to this department
increased by 24,9%.
Public Works receives R464,5 million, an increase of 28,6%
over the 2004/05 allocation. This department has been
assigned the responsibility of investigating and leading the
construction of new office blocks for government. These
funds will also be utilized for the EPWP.
Public Works is responsible for co-ordinating the Expanded
Public Works Programme to ensure that we create jobs and
skills for our people through the design and implementation
of infrastructure and other job creating initiatives.
I believe that with the increased development budget we
are tabling today, we can do more to create jobs and
develop skills in our province and meet the priorities set by
42
both the Premier and President in their respective speeches
recently.
Social Development receives R4, 949 billion, an increase of
22,4% of which R4,674 billion is conditional grant for mainly
social grants (R4,616 million), HIV/AIDS grant in respect of
life skills development (R15,9 million) and food relief for R46
million. An amount of R7 million is also provided for the
upgrading and retention of social workers.
Agriculture, Conservation, Environment and Tourism
receives R494, 677 million, an increase of 5,3%. Other areas
of focus will be land reform, post-settlement support and
actual support to emerging farmers. Tourism promotion
services receives R31 million of the Agriculture budget,
Managing the Budget for effective service delivery.
The budget being presented here today belongs to the
people we serve. We in government are just custodians of it
and our responsibility is to manage it to ensure that it is used
for purposes it has been allocated for.
43
We will manage the budget in accordance with the prescripts
of the Public Finance Management Act.
The Budget Oversight Committee will interrogate monthly
expenditure reports, ensure that Departments submit
financial and non-financial reports in terms of the PFMA to
ensure that we eradicate under expenditure.
On a quarterly basis, the Committee will undertake an
extensive interrogation on expenditure and performance
against the strategic plans of departments to ensure that we
deliver to our people.
The Committee will deal seriously with material over or
under expenditure together with the various portfolio
committees whose role is to provide oversight and give
feedback to our various constituencies on how we are
managing our resources, implementing our policies and the
impact such are making on the communities.
This budget is the basis to realise the vision of the Freedom
Charter and give meaning to the values enshrined in our
Constitution.
44
Madam Speaker, this budget is for development and
economic growth. This is a budget, which speaks about
Freedom – therefore pursuing the vision of the Freedom
Charter.
Madam Speaker, allow me to now table the following:
• North West Appropriation Bill 2005
• Revenue and Expenditure estimates
• People’s Guide to the Budget
• A copy of the Budget Speech.
Conclusion
In conclusion, Madam Speaker, allow me to remind this
house of the words of one of the most distinguished icons in
our liberation struggle, who voluntarily dedicated his entire
life to free his people from the shackles of apartheid,
Comrade Oliver Reginald Tambo, from his 1971, New Year
message entitled 'We who are free to eat and sleep at will'
he said ,
45
" We who are free to eat and sleep at will, to write, to
speak, to travel as we please; we who are free to make
or break a revolution, let us use our comparative
freedom, not to perpetuate the misery of those who
suffer, nor to give indirect aid to the enemy they fight by
withholding our own contribution."
Although Oliver Tambo has passed on, his words are true to
our own challenges today as they were to the situation he
was addressing in 1971, because indeed those of us who
are free to eat and sleep at will should not perpetuate the
misery of those who suffer, those who have no economic
power, those who are marginalised and those who constitute
the majority of our people, by refusing to empower them so
that, they too, can eat and sleep at will.
Madam Speaker, in our quest to realise the vision of the
Freedom Charter, and the values of our Constitution, we
must constantly ensure that our resources are deployed
efficiently.
For some time now, the Provincial Government has been
owning the Leopard Park Golf Estate.
46
Madam Speaker, I want to inform this house that we will be
selling this Estate. We are inviting any interested person,
even my colleagues or anybody who plays golf to bid for the
Estate. (The cost is yet to be determined).
Let me take this opportunity to extend my gratitude to
the following:
The Honourable Premier for her leadership and advice in the
construction of this budget. Mme Premier re a leboga.
Members of the Budget Oversight Committee (BOC) for their
excellent contributions and all my colleaques in EXCO.
Honourable Mahumapelo and Honourable Matladi, for their
oversight as chairpersons of Finance and Economic
Development and Public Accounts Committees respectively.
Mr Tjie, the ever-smiling Superintendent General, Mr Ernst
Van Wyk, Mr Geo Paul, Mr Andrew Kyereh, Mr Kingsley
Sehularo, Chief Financial Officer and Heads of our
Parastatals and the Budget Team, and all other HOD’s for
their efforts in helping us shape this budget.
47
Management of the Department and staff in my office,
including everybody in the Department of Finance and
Economic Development for the excellent reception when I
came into the Department and their support, even those in
our District Offices.
The Office of the Auditor General and the Provincial Audit
Committee.
Chairperson of the Tender Board, members and staff of the
Board. Even though the Board is being phased out, you will
remain critical in our continued efforts to give credibility to
our procurement process and promote Black Economic
Empowerment.
Chairperson of the Provincial Gambling Board. Ms Thebi
Moja.
To my wife Thandi and the family thanks for your continued
understanding and support.
To the people who are here today and the public in general,
thanks for listening to us.
48
To the media in general, your support and dissemination of
our information is valued.
Madam Speaker, in this second decade of Democracy, LET
US SPEAK OF FREEDOM and do even more to realise the
vision of the Freedom Charter.
Thank You!
Kea leboga !
Baie Dankie!