N6 – Module 7


Should the government use the GDP as a guideline? This might prove a problem because the “poorer” province might have been more disadvantaged in the past, and therefore needs even more assistance than the “richer” provinces. Added to this complication is the fact that the socio- economic problems of an urban area might differ dramatically from those of a rural area; a province might be either largely rural or urban, or a mixture of the two, making matters even more difficult. More worrying than the matter of how to arrive at a workable and acceptable formula is the political fact that the national government may, if it wishes, use the system of provincial grants to get provinces to toe the line – in other words, those provinces which “obey” more easily might be “rewarded” by the central government. The grant then becomes a reward or a tool of punishment to encourage that province to adhere to good democratic principles.


Table 3: Provincial Allocations Province


Eastern Cape Free State Gauteng KZN


Limpopo


Mpumalanga Northern Cape North west


Western Cape Budget R9,245m


Spent as at 15 Feb 2010


R4,722m


R3,490m R3,465,128m R74,000m


R31,080m


R121,18m R12,773,654 R44,216m R59,601m 0


R16,072m R30,884m 0


R11,576m R129,287m


R10,650 R123,888m Source: Department of Basic Education Table 3: Budget for 2011


Taxation Provinces are allowed to levy taxes on betting (totalisator and bookmakers), motor vehicles – licenses, gambling fees and gambling taxes.


Levies and General Activities Levies might include licenses for hunting and fishing; general activities might include fees for hospitalisation, professional services, etc.


Local Government Finance


The principles of good governance, accountability, effective and efficient expenditure which apply to the executive and administrative authorities nationally, should also apply to local authorities. The main differences between the budgets of the national legislature and that of local governments can be listed as follows: • Capital budgets and operational budgets are drafted separately; • The expenditure and revenue budgets are drafted together – the impact of one on the other can then be clearly seen;


• There is only one main budget – no interim, supplementary or adjustment appropriation bills • or budgets; • A budget vote listing programmes and projects is drawn up for each service; • There is no distinction between collective, particular and quasi-collective services.


112 % of


budget spent


51 99 69


Variance R4,523m


R35,127,77 R42,920m


11 R108,244,345 36 52 0


R28,165m R28,717m 0


92 96


R0.926080 R5,398m


9 788


164 046 25 670


112 108 12 729 181 110 10 277


2011/12 R


(000)


2012/13 R


(000)


26 954 118 834 13 365 190 165


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