“This budget is about prioritisation”, said Pravin Gordhan at the the annual South African budget speech made before Parliament.
The current Minister of Finance stood before parliament to present the fiscal budget for 2016/17 and the suggestions for how the budget should be allocated over the next three years.
Being about prioritisation, the minister was quick to point out that this extends to all South Africans and that given the global economic climate, spending must be prudent and properly budgeted for.
“We cannot spend money we do not have” Gordhan remarked, “we cannot borrow beyond our ability to repay, if you can borrow R1 000 borrow R1 000 not R2 000. Until we can ignite growth and generate more revenue, we have to be tough on ourselves.”
Among these priorities is a new stipulation that Gordhan brought before the house. Tender bids will now need to be submitted through the government’s “e-tender portal”, and paper submissions will no longer be allowed. This has been introduced to enforce transparency in the procurement process and provide a reference point for the price of goods and services.
Gordhan went on to say that banking services, ICT infrastructure and services, health technology, school building and learner support materials. would be subject to centrally negotiated contracts.
This will see government taking a more active role in the discussion of these contracts, and will come into effect from April.
Broadband and SA Connect
On the the topic of broadband infrastructure and the benefits of investing in development, Gordhan said, “Investments by telecommunication partners in fast internet connectivity for schools, clinics and government buildings brings down the costs, over time, for internet connectivity for neighbouring homes and businesses.” The hope is that this will spur on internet penetration across South Africa.
Speaking of broadband, Gordhan has earmarked R1.6 billion to go to the SA Connect broadband programme over the medium term expenditure period. This budget has been allocated to bring internet access to remote areas, schools, health facilities and government institutions.
Allocations for energy
Over the next three years, as much as R180 billion will be invested in the completion of Medupi, Kusile and Ingula power plants. For the current financial year this figure is as much as R70 billion.
Gordhan went on to encourage private and public entities to join forces and collaborate on investments to push infrastructure development forward rapidly. “We have much to learn from each other, both nationally and through provincial and local initiatives”, he said.
Throughout his speech it became clear that a lot of work needs to be done in South Africa and while the global economy is on rocky ground Gordhan urged government and South Africans to remain positive.
In closing Gordhan echoed the words of the late Nelson Mandela saying, “Part of being optimistic is keeping one’s head pointed toward the sun, one’s feet moving forward.”
“There were many dark moments when my faith in humanity was sorely tested, but I would not and could not give myself up to despair. That way lays defeat and death.”[Image – CC ND BY/2.0 GovernmentZA]